2013 (8) TMI 470 - AT - Customs

Classification of Goods - Import of Inula racemosa and Chinese Ginseng - Goods imported by the assessee were found to be mis-declared by description Revenue proceeded to ascertain the value - Revenue confiscated the goods granting an option to redeem the goods on payment of redemption fine - Held that - Test report of goods did not reveal in favour appellant there was no necessity to interfere with the adjudication finding as to the nature of goods duty was also confirmed. Quantum of redemption fine and penalty payable Held that - Imposition of fine may not be improper in the fitness of the circumstances of the case and reducing penalty to 50% of the duty element would be justified - imposition of huge fine shall cause undue hardship to the appellant and the penalty to the extent of duty element shall also be harsh - appeal decided partly in favour of assessee.

Summary

Issues:
1. Mis-declaration of imported goods
2. Determination of the value of mis-declared goods
3. Confiscation of goods and imposition of redemption fine
4. Duty liability and penalty imposition
5. Individual penalties imposed on involved parties

Analysis:

1. The appellant imported goods mis-declared as 'Inula racemosa' and 'Chinese Ginseng,' which were actually 'Saussurea Lappa' and 'Salam Panja,' respectively. The mis-declaration was confirmed through testing by a laboratory, and the proprietor of the importing firm admitted to the misrepresentation. The Revenue recalculated the value of the goods based on the actual identities, leading to the confiscation of the goods with an option for redemption on payment of a fine.

2. The value of the mis-declared goods was determined based on the import prices of 'Saussurea Lappa' and 'Salam Panja' provided by relevant authorities. The declared values were rejected, and new values were set for both types of goods. The duty liability was recalculated accordingly, and penalties were imposed on the importer for the differential duty amount. No penalty was imposed on the proprietor of the importing firm.

3. The confiscated goods were subject to redemption on payment of a fine, and the customs duty leviable was to be paid for home consumption clearance. The appellant had the option to redeem the goods by paying the specified fine and duty, as per the provisions of the law.

4. The adjudication order directed the appraising officers to determine the duty liability based on the re-determined assessable value and communicate it to the importer. Any interest payable was also to be calculated and communicated. The penalties imposed on the importer were to be equivalent to the total amount of the differential duty and interest payable.

5. Individual penalties were imposed on Shri Saket Aggarwal and Shri Praveen Aggarwal under the Customs Act for their involvement in the mis-declaration of goods. The penalties were reduced based on the circumstances of the case and the cooperation of the appellants during the proceedings, ultimately leading to a partial allowance of the appeals.

In conclusion, the judgment upheld the findings of mis-declaration, recalculated the value of the goods, imposed duties and penalties accordingly, and confirmed the confiscation of the goods with options for redemption. Individual penalties were imposed based on the involvement of specific parties, with some penalties being reduced considering the overall circumstances of the case.