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2022 (8) TMI 722 - AT - CustomsPower of Customs (appeals) in reducing the value - Valuation of imported goods - Used tyres - rejection of declared value - Confiscation - redemption fine - penalty - HELD THAT - It is settled position in law that it is the discretion of the authority deciding to determine the quantum and fine and penalty as per the gravity of the offence involved. It is not even the case that Commissioner (Appeals) has exonerated completely the respondent. The total offence which is as per the order of the Assistant Commissioner, is about 10% of under valuation. Against the declared value of US 30429 (Rs 14,19,513/-), Revenue has determined the loaded value to U 33846.40 (Rs 15,78,935/- CIF). The total case which involves undervaluation is not more than 10% of the value of the goods under importation. Thus in the present case the redemption fine as determined by the Commissioner (Appeal) on the basis of the CESTAT Bangalore Bench order is above 10% in the case of HT. COMPANY VERSUS COMMISSIONER OF CUS., HYDERABAD 2006 (11) TMI 384 - CESTAT, BANGALORE for fixing the fine and redemption fine as per the percentage indicated in that order, which is higher than what has been upheld by the Hon ble High Court - there are no merits in the said submissions of the revenue. There are no merits in the appeal filed by Revenue challenging the order of Commissioner (Appeals) whereby he has reduced the redemption fine equivalent to 10% of undervaluation and which is in accordance with the order of Bangalore CESTAT - From the provisions of Section 128 and 128 A of the Customs Act, 1962, it is quite evident that there is sufficient power vested in the Commissioner (Appeal) to confirm, modify or annul any decision or order appealed against. Any order used in the section 128 and 128A, is wide enough to include the orders passed in respect of the imposition of penalty on the aggrieved person. Thus the order of reducing the penalty by Commissioner (Appeal) and aligning the same with the percentage of penalty as determined by the Bangalore Bench cannot be faulted with. The appeal filed by the Revenue is dismissed and the impugned order of Commissioner (Appeals) is upheld.
Issues Involved:
1. Legitimacy of the declared value of imported used tyres. 2. Confiscation and redemption fine imposed on the imported tyres. 3. Imposition of penalty on the importer. 4. Justification of the reduction in redemption fine and penalty by the Commissioner (Appeals). Issue-wise Detailed Analysis: 1. Legitimacy of the declared value of imported used tyres: The Assistant Commissioner rejected the declared value of USD 30,429 (Rs. 14,19,513) for 1844 used tyres imported under Bill of Entry No. 482275 dated 23.03.2010. The value was re-determined as USD 33,846.4 (Rs. 15,78,935) under Rule 9 of Customs Valuation Rules, 2007 read with Section 14 of Customs Act, 1962. The Commissioner (Appeals) upheld the re-determined value, noting that the value declared by the importer was significantly lower than the estimated value by the Chartered Engineer, which was accepted by the appellants. 2. Confiscation and redemption fine imposed on the imported tyres: The Assistant Commissioner confiscated the 1843 used tyres valued at Rs. 15,78,935 under Section 111(d) & 111(m) of the Customs Act, 1962 read with Section 3(3) of the Foreign Trade (Development and Regulation) Act, 1992. However, an option was given to the importer to redeem the same on payment of a fine of Rs. 3,00,000 under Section 125 of Customs Act. The Commissioner (Appeals) reduced the redemption fine from Rs. 3,00,000 to Rs. 1,60,000, following the ratio of the CESTAT Bangalore Bench in similar cases. 3. Imposition of penalty on the importer: The Assistant Commissioner imposed a penalty of Rs. 2,00,000 on the importer under Section 112(a) of the Customs Act, 1962. The Commissioner (Appeals) reduced the penalty to Rs. 80,000, aligning with the precedents where penalties were fixed at a percentage of the enhanced value of the goods. 4. Justification of the reduction in redemption fine and penalty by the Commissioner (Appeals): The Revenue argued that the Commissioner (Appeals) wrongly relied on the CESTAT Bangalore Bench's decision and contended that the reduction in fine and penalty was not justified given the high profit margins of restricted goods like used tyres. However, the Tribunal noted that the Commissioner (Appeals) acted within his discretion as provided under Section 128 and 128A of the Customs Act, 1962, which allows the appellate authority to confirm, modify, or annul the decision or order appealed against. The Tribunal upheld the Commissioner (Appeals)'s decision, stating that the reduction in fine and penalty was in accordance with the established legal principles and precedents. Conclusion: The appeal filed by the Revenue was dismissed, and the impugned order of the Commissioner (Appeals) was upheld. The Tribunal found no merit in the Revenue's challenge to the reduced redemption fine and penalty, affirming that the Commissioner (Appeals) had acted within his legal discretion. The decision emphasized the principle that the appellate authority steps into the shoes of the adjudicating authority and has the power to modify orders, including those related to fines and penalties.
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