1996 (9) TMI 261 - AT - Customs

Summary

Issues:
1. Discrepancy in the description of imported goods.
2. Allegation of intention to evade payment of duty.
3. Imposition of penalty and redemption fine.

Analysis:
1. The case involved a dispute regarding the description of imported goods, specifically "Bright Yellow Crude Sulphur" declared as powder form in a letter accompanying the Bill of Entry. The Department alleged incorrect description to evade duty under Notification No. 7/92 exempting only powder form from CVD levy.

2. The Revenue contended that the misdeclaration was intentional to avail the exemption, highlighting the duty amount involved and the discrepancy between the Bill of Entry description and the accompanying letter. They argued for higher penalty and redemption fine based on the clear intention to evade duty.

3. The respondents, a small importer, argued that they were actual users of the imported sulphur, following the lead of a major importer in declaring the goods as powder form. They claimed no intention to evade duty as they utilized Modvat credit for duty paid on imported sulphur in their manufacturing process.

4. The Tribunal acknowledged the misdeclaration but focused on the circumstances, noting the respondents' status as actual users and their reliance on Modvat credit. The adjudicating authority's decision to impose a lower penalty and redemption fine was upheld, considering it was the first instance for the respondents and their legitimate use of the imported sulphur.

5. The Tribunal emphasized that the quantum of penalty and fine depends on the case's specifics, finding the adjudicating authority's reasoning sufficient in this instance. They upheld the lower penalty and redemption fine, concluding that the circumstances warranted a lenient view due to the respondents' genuine use of the imported sulphur and entitlement to Modvat credit.

6. Ultimately, the Tribunal rejected the Revenue's appeal, affirming the adjudicating authority's decision on the penalty and redemption fine, based on the legitimate use of the imported goods by the respondents and the absence of clear intent to evade duty.