2019 (5) TMI 1422 - AT - Customs

Misdeclaration of value of imported goods - goods imported was primarily steel plates of prime quality but was misdeclared as Heavy Melting Scrap - The only ground on which appellant tried to plead innocence regarding such mis-declaration about the description of goods was that it purchased the same on high sea sale and filed Bill of Entry on the basis of invoice raised by the exporter but there was no bar on the appellant for personal inspection before finalisation of purchase - HELD THAT - No irregularly can be noticed in the order passed by the Commissioner of Customs (Imports) when appellant itself admitted the examination report concerning the quality of goods imported. Confiscation - Imposition of penalty - omission committed or not - appellant had contended that no act or omission was proved against the appellant that would result in confiscation under Section 111(m) and Section 119 of the Customs Act and imposition of penalty under Section 112(a) of the Customs Act 1962 - HELD THAT - As found from the Commissioner order s and from the case record 28, 000 Kg. HR M S plates valued at 11, 20, 000/- (re-determined) were misdeclared for which those were liable for confiscation under Section 111(m) of the Customs Act 1962 and HR M S plates of 81, 780 Kg. valued at 11, 49, 826/- were camouflaged that made the goods liable for confiscation under Section 119 of the Customs Act 1962. No plausible explanation was offered by the appellant to refute those findings for which appellant-importer was also imposed with penal action under Section 112(a) of the Customs Act - confiscation and penalty upheld. Appeal dismissed - decided against appellant.

Summary

Issues:
Redetermination of value of imported goods misdeclared as "Heavy Melting Scrap" under Section 111(m) of the Customs Act, 1962 with confiscation, redemption, and penalty.

Analysis:
The appellant challenged the order of the Commissioner of Customs (Imports) regarding the redetermination of the value of imported goods misdeclared as "Heavy Melting Scrap." The appellant imported a consignment of HMS scrap, which was found to be primarily steel plates of prime quality camouflaged with shredded scrap and stamping waste scrap. The value of the goods was enhanced to ?22,69,826 from the declared value of ?15,43,506.20. The appellant admitted the misdeclaration and accepted the classification and value of the goods as per Rule 9 of the Valuation Rule, 2007, leading to the imposition of basic Customs duty at 10%. Confiscation under Section 111(m) and redemption of goods upon payment of fine along with a penalty under Section 112(a) were also ordered. The appellant contested the order, citing cases and arguing against the invocation of Rule 9 without relying on similar imports.

During the appeal, the appellant argued that the goods were purchased on high sea sale basis and there was no mala fide intention in the misdeclaration. However, the Authorised Representative for the respondent-department supported the Commissioner's order, emphasizing the examination process and the misdeclaration established by the valuation. The Tribunal reviewed the case record and found that the appellant admitted the misdeclaration, and the Commissioner's valuation under Rule 9 was justified based on the international market price of similar goods. The Tribunal upheld the Commissioner's order, dismissing the appeal.

The appellant contended that no act or omission justified confiscation and penalty under the Customs Act. However, the Commissioner's order and case record revealed the misdeclaration and camouflaging of goods, leading to confiscation under Sections 111(m) and 119. The appellant failed to provide a satisfactory explanation, resulting in the imposition of penalties under Section 112(a). The Tribunal found no irregularity in the Commissioner's order and confirmed the dismissal of the appeal, upholding the original order passed by the Commissioner of Customs (Imports), JNCH, Nhava Sheva.

In conclusion, the Tribunal dismissed the appeal and confirmed the order of the Commissioner of Customs, upholding the redetermination of value, confiscation, redemption, and penalty imposed on the imported goods misdeclared as "Heavy Melting Scrap."