2020 (4) TMI 278 - AT - Customs

Valuation of imported goods - import of multi functional digital copiers - enhancement of value - restricted goods - import restrictions under notification No.31 (RE-2012)/2009-14 - Confiscation - redemption fine - penalty - HELD THAT - Evidently, only photo copier machines and not multi functional digital copiers were restricted for import during the relevant period. Restriction on multi functional digital copiers came into force much later only w.e.f. 28.02.2013 - This issue has been decided by the Hon ble High Court of Madras in the case of THE COMMISSIONER OF CUSTOMS, CUSTOM HOUSE VERSUS M/S. CITY OFFICE EQUIPMENT AND OTHERS 2013 (4) TMI 655 - MADRAS HIGH COURT clearly holding that the restriction on import of second hand multi functional digital copiers come into force only from 28.02.2013 and not before - Therefore, the import of the goods in question was therefore not restricted and confiscation under section 111(d) needs to be set aside. Enhancement of value - HELD THAT - The enhancement was marginal from US 23,855/- to US 30,030/-. The importer could have challenged this enhancement arguing that there is no evidence that they have mis-declared the value and hence the declared value must be accepted. However, they have chosen not to do so and paid the customs duty on the enhanced value. Mere acquiescence by the importer in order to expedite their clearances through customs does not form the evidence that the value has been mis-declared, more so when the enhancement was marginal - Confiscation as well as redemption fine set aside. Appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Import of second-hand digital multi-functional machines without a valid license.
2. Confiscation of goods for misdeclaration of value and lack of import license.
3. Imposition of penalty under section 112(a) of the Customs Act, 1962.

Analysis:
1. The appellant, a proprietary firm based in Chennai, imported 102 old and used digital multi-functional machines without a valid import license. The Customs department assessed the value of the goods at US $30,030/-, higher than the declared value of US $23,855/-. The Additional Commissioner held the goods liable for confiscation under section 111(d) for lack of a license and section 111(m) for misdeclaration of value, imposing a penalty of &8377; 75,000/-.

2. The appellant argued that during the relevant period, from 19.10.2005 to 28.02.2013, import of second-hand multi-functional digital copiers was not restricted. They cited relevant notifications and legal precedents, including the case of City Office Equipment, to support their claim. The Tribunal found that the import of such machines was not restricted during the relevant period, and thus, confiscation under section 111(d) was not justified.

3. Regarding the enhanced value assessment, the Tribunal noted that the appellant had paid the duty on the enhanced value without challenging it. The mere acceptance of the enhanced value did not establish misdeclaration, especially considering the marginal increase. Therefore, the confiscation under section 111(m) was deemed unwarranted, leading to the setting aside of the penalty and fine imposed.

4. In conclusion, the Tribunal allowed the appeal, setting aside the impugned order and providing consequential relief. The judgment clarified that the import of second-hand digital multi-functional machines without a license was permissible during the relevant period, and the confiscation for misdeclaration of value was unfounded due to the lack of evidence supporting the claim.