2009 (11) TMI 752 - AT - Customs

Summary

Issues Involved:
1. Misdeclaration of value of imported goods.
2. Reliance on an unsigned and unauthenticated invoice.
3. Rejection of documentary evidence of contemporaneous imports.
4. Confessional statements and their retraction.
5. Imposition of redemption fine and penalty.

Detailed Analysis:

1. Misdeclaration of Value of Imported Goods:
The assessee imported fishing nets from Thailand and declared their value based on an invoice. The Customs Intelligence Unit (CIU) found a higher value invoice for the same goods, leading to the proposal to confiscate the goods under Section 111 of the Customs Act and impose penalties under Section 112. The original authority confiscated the goods and imposed a fine and penalty, which was upheld by the Commissioner (Appeals). The Tribunal found the misdeclaration of value to be a valid ground for confiscation under Section 111(m) and upheld the confiscation and penalties imposed on the assessee.

2. Reliance on an Unsigned and Unauthenticated Invoice:
The assessee argued that the invoice showing a higher value was neither signed by the supplier nor authenticated and thus could not be relied upon. The Tribunal noted that the invoice recovered by the CIU matched the one provided by the assessee except for the value. The Tribunal held that the confessional statements and voluntary payment of differential duty by the assessee's director validated the invoice's authenticity, thereby rejecting the assessee's argument.

3. Rejection of Documentary Evidence of Contemporaneous Imports:
The assessee presented evidence of contemporaneous imports showing the value of identical goods at par with the declared value, which was rejected by the Commissioner without valid reason. The Tribunal upheld the Commissioner's decision, noting that the assessee's confessions and the CIU's findings provided sufficient grounds to reject the contemporaneous import data.

4. Confessional Statements and Their Retraction:
The director of the assessee-company gave multiple statements under Section 108 of the Customs Act, confessing to the misdeclaration of value. The director later retracted these statements, claiming they were made under duress. The Tribunal found the retraction to be unsubstantiated and upheld the confessional statements as valid evidence. The Tribunal referenced case law supporting the principle that admitted facts do not require further proof and upheld the differential duty demand based on these confessions.

5. Imposition of Redemption Fine and Penalty:
The Tribunal addressed the imposition of redemption fines and penalties. For the goods covered by the bill of entry dated 15-5-2001, which were available for confiscation, the Tribunal upheld the confiscation, redemption fine, and penalty imposed on the assessee. However, for the goods covered by the past 11 consignments, which were not available for confiscation, the Tribunal set aside the redemption fine following the Larger Bench decision in Shiv Kripa Ispat P. Ltd. v. CCE, Nasik. The penalty under Section 114A was upheld as the misdeclaration of value was established with intent to evade duty. The penalty on the director under Section 112 was set aside due to the lack of specific findings supporting the penalty.

Conclusion:
- Appeal No. C/224/02 was rejected.
- Appeal No. C/426/06 was partly allowed, setting aside the redemption fine but upholding the penalty under Section 114A.
- Appeal No. C/427/06 was allowed, setting aside the penalty on the director under Section 112.