2017 (2) TMI 1023 - AT - Customs

Mis-declaration of imported goods - Heavy Melting Scrap - High Seas Sale - presence of restricted goods in the import - whether the appellant BPIL and VRC mis-declared the goods? - Held that - VRC placed an order of Heavy Melting Scrap and contract specifically records that order is for approximately 100 tons, the bill of lading issued by the foreign supplier also indicates Heavy Melting Scrap, load port inspection certificate issued by authorities also indicates the same. After perusal of the documents as produced, I find that the lower authorities have erred in confiscating the goods - the appellant BPIL acted on the certificate intimating that consignment does not contain any live war material. In the case in hand, in fact the war material as was found was used and rusted and totally discharged - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Confiscation of imported goods due to mis-declaration and presence of restricted war material.
2. Re-assessment of value and classification of imported goods.
3. Imposition of penalties on the importers.
4. Validity of the certificate issued by the certifying agency.
5. Comparison of the present case with a previous Tribunal decision.

Detailed Analysis:
1. The judgment involves the confiscation of imported goods due to mis-declaration and the presence of restricted war material. The lower authorities held that the certificate provided by the certifying agency at the load port was incorrect, as it did not disclose the presence of used and dead cartridges/artillery shells in the consignment. The adjudicating authority ordered the reassessment of the goods under the Customs Act, leading to the absolute confiscation of the restricted goods and the confiscation of other related goods used for concealment.

2. The judgment also addresses the re-assessment of the value and classification of the imported goods. The order specified the reassessment of the value of the restricted goods and their classification under the Customs Act. The value was revised based on the weight and condition of the cartridges/artillery shells, leading to their absolute confiscation under various sections of the Customs Act.

3. Penalties were imposed on the importers in this case. A penalty was levied on M/s Shri Bajrang Power & Ispat Ltd. for purchasing the goods through high sea sales, and a separate penalty was imposed on M/s V Rasiklal & Company for their involvement in the importation process. The penalties were imposed under specific sections of the Customs Act, totaling a significant amount.

4. The validity of the certificate issued by the certifying agency was a crucial aspect of the case. The appellant argued that the war material found in the consignment was dead, used, and empty cartridges/artillery shells, which should not have led to absolute confiscation. The appellant contended that they acted based on the certificate indicating no live war material in the consignment, and the issue of mis-declaration was disputed.

5. The judgment compared the present case with a previous Tribunal decision involving a similar issue of confiscation of war material. The Tribunal decision cited highlighted the importance of evidence regarding the importer's knowledge of the objectionable material in the consignments and the role of the inspection agency in issuing certificates. The decision emphasized the need for proper inspection procedures and questioned the justification for penalties on importers based on faulty inspection reports.

In conclusion, the judgment set aside the impugned order, finding it unsustainable, and allowed the appeal based on the discrepancies in the confiscation and mis-declaration aspects of the case.