1994 (11) TMI 265 - AT - Customs

Summary

Issues:
1. Validity of import of used diesel engines without a proper license.
2. Misdeclaration of goods in the Bill of Entry.
3. Valuation of imported goods.
4. Confiscation of goods and imposition of penalties.

Analysis:

Issue 1:
The appellants imported used diesel engines without a valid import license, which was required as per the Import Policy. The Customs House confiscated the goods and imposed penalties. The Tribunal upheld the confiscation under Section 111(d) of the Customs Act, 1962 due to the lack of a license.

Issue 2:
The goods were misdeclared in the Bill of Entry as "second-hand once used & old diesel engines" without disclosing additional fittings like gear boxes and compressors. The Tribunal found the misdeclaration of goods' description to be established, as observed in previous cases. The misdeclaration of value was also noted, leading to the rejection of the invoice value as it did not reflect the correct value due to the additional fittings.

Issue 3:
Regarding the valuation of the imported goods, the Tribunal considered the practical difficulty in determining the value of second-hand engines with additional fittings. The appellants failed to provide evidence of negotiations including the extra fittings in the price. The Tribunal discarded the invoice value as it did not represent the transaction value, as established in previous case law.

Issue 4:
The penalties imposed on the appellants and the fine on the goods were justified due to the established misdeclaration and lack of a valid license. However, the penalty on appellant Ms. Sudha H. Parikh was set aside as there was insufficient evidence of her involvement and explanation for the penalty during the personal hearing. The Tribunal modified the Collector's order to set aside the penalty on Ms. Sudha H. Parikh.

In conclusion, the Tribunal upheld the confiscation of goods, rejected the invoice value for valuation, and justified the penalties while setting aside the penalty on appellant Ms. Sudha H. Parikh due to lack of sufficient evidence. The decision was based on established misdeclaration and lack of a valid import license for the used diesel engines.