2017 (6) TMI 615 - AT - Customs

Confiscation - redemption fine - penalty - valuation - enhancement of value of the imported goods in terms of local Chartered Engineer opinion - Held that - customs authorities have rejected the opinion of one expert simply on the basis of opinion by another expert. We note that there is no other sufficient independent reason for such rejection. Such rejection has been held as not a valid basis for rejection of Chartered Engineer certificate in the case of Anish Kumar Spinning Mills 2004 (5) TMI 172 - CESTAT, CHENNAI - Admittedly, the imported goods are more than 10 years old in terms of Import Trade Control Regulations in EXIM 2002-07 read with para 3.3 of the Handbook of Procedures of Vol-I. The importers have violated the provisions of Foreign Trade (Development and Regulation) Act, 1992. The goods are therefore liable for confiscation under Section 111 (d) of the CA 1962 - penalty upheld - the quantum of redemption fine and penalty reduced - appeal allowed - decided partly in favor of appellant.

Summary

Issues:
1. Discrepancy in valuation of imported goods
2. Validity of Chartered Engineer certificates
3. Confiscation and penalty under Customs Act

Discrepancy in Valuation of Imported Goods:
The appellant imported a used offset printing machine and declared its value at US $25,000. The local Chartered Engineer assessed the value at US $69,000, leading to a show cause notice for re-assessment and confiscation. The appellant argued that the overseas Chartered Engineer certificate was valid and the local assessment was arbitrary. The Tribunal noted that the rejection of the overseas certificate lacked sufficient independent reasons and relied on precedent to uphold the declared value. The reassessment based on the local certificate was deemed invalid.

Validity of Chartered Engineer Certificates:
The customs authorities disregarded the load port Chartered Engineer certificate due to discrepancies in the year of manufacture. The appellant contended that the rejection was unjustified as no evidence contradicted the load port certificate. The Tribunal found that the local Chartered Engineer did not provide substantial reasoning for the reassessment, leading to the conclusion that rejection based solely on a different expert's opinion was insufficient. The decision highlighted the importance of valid reasons for rejecting expert certificates.

Confiscation and Penalty under Customs Act:
The imported goods, being over 10 years old, violated trade regulations, warranting confiscation under the Customs Act. Additionally, penalties were imposed on the importers for non-compliance. Considering the circumstances, the Tribunal reduced the redemption fine and penalty amount. The judgment partially allowed the appeal, adjusting the financial liabilities imposed on the importers in light of the violations.

This detailed analysis of the judgment covers the discrepancies in valuation, the validity of Chartered Engineer certificates, and the consequences under the Customs Act, providing a comprehensive overview of the legal issues addressed in the case.