1994 (1) TMI 180 - AT - Customs

Summary

Issues Involved:

1. Jurisdiction of the adjudicating authority.
2. Issuance of a show cause notice.
3. Disclosure of evidence to the appellant.
4. Determination of the value of imported goods.
5. Allegations of under-invoicing and misdeclaration.

Detailed Analysis:

1. Jurisdiction of the Adjudicating Authority:

The appellants argued that the adjudicating authority lacked jurisdiction to reassess the goods since they were already assessed by the Customs House and duty was paid. They relied on the decision in Sharad Himatlal Daftari v. Collector of Customs, which stated that reassessment without setting aside the original order is not permissible. However, the tribunal found that any competent officer with jurisdiction could adjudicate the proceedings if there was a misdeclaration of value or quantity, even if the goods were cleared under Section 47 of the Customs Act. The tribunal referenced the cases of Madan Lal Steel Ltd. and Deepak Electronics to support this view, concluding that the Collector of Customs (Preventive) was right in assuming jurisdiction.

2. Issuance of a Show Cause Notice:

The appellants contended that the seizure was conducted without issuing a seizure memo and a mandatory show cause notice under Section 124 of the Customs Act. The tribunal noted that the appellants had waived the show cause notice and participated in the personal hearing. It cited the case of Badjugar Kailash, which held that if a written show cause notice is waived, an oral notice should suffice. The tribunal concluded that the mandatory provisions of Section 124 were fulfilled as the appellants were aware of the charges and had an opportunity to be heard.

3. Disclosure of Evidence to the Appellant:

The appellants argued that the order was based on statements recorded behind their back and that they were not provided copies of such statements, which amounted to a denial of natural justice. The tribunal found that there is no mandatory provision for supplying such evidence, but natural justice requires that it be disclosed. It was clear from the facts that the evidence was disclosed to the appellants during the personal hearing, and they did not dispute the misdeclaration of value. The tribunal concluded that there was no procedural lapse.

4. Determination of the Value of Imported Goods:

The appellants argued that the value of the goods was enhanced without contemporary evidence and solely based on statements. They cited the case of HI-Iron Electronics, which held that the burden of proving undervaluation lies with the Department. The tribunal found that the evidence, including a fax message from M/s. Tomoe Sangyo Co. Ltd. showing a higher unit price, supported the Department's case. The appellants had voluntarily admitted the correct unit price during the hearing and in a subsequent letter. The tribunal concluded that the Collector was right in determining the value at US $5 per piece based on the voluntary statements and evidence.

5. Allegations of Under-Invoicing and Misdeclaration:

The appellants admitted to under-invoicing and agreed to pay the differential duty. They also acknowledged the misdeclaration of value and requested leniency. The tribunal found that the facts and evidence, including compensatory payments and voluntary admissions, substantiated the allegations of under-invoicing. The tribunal upheld the order of confiscation and the imposition of a penalty, concluding that there was no infirmity in the adjudicating authority's decision.

Conclusion:

The tribunal dismissed the appeal, upholding the adjudicating authority's order on all grounds, including jurisdiction, issuance of a show cause notice, disclosure of evidence, determination of value, and allegations of under-invoicing and misdeclaration.