2022 (11) TMI 868 - AT - Customs

Confiscation of goods - Seeking release of declared goods - Misdeclaration of imported goods - Polished Marble Slabs (thickness below 2.0 cm) - quantity actually imported was much more than what was declared in the Bill of Entry and other documents - method of measurement adopted during examination - abatement of duty - Confiscation - redemption fine - penalty - HELD THAT - To claim abatement under section 22, the importer has to prove to the satisfaction of the Assistant Commissioner/Deputy Commissioner that the damage occurred before unloading or during unloading or after unloading due to an accident - the abatement is of the duty and not of the quantity of the goods imported which is a matter of fact. After reckoning the entire quantity of goods which are imported, if some proportion of the goods are damaged, as per section 22, then the duty to that extent can be abated. The quantity of goods does not abate. If there were hairline cracks or if there was chemical damage or even if the corners were cut or chipped, the quantity of the goods imported does not vary. It must also be noted that abatement under section 22 only covers damages before or during unloading or after unloading but before examination due to accidents. Natural deficiencies in the imported material such as irregular edges which occur naturally are not covered under this section - It must also be noted that abatement of duty under section 22 and remission of duty under section 23 are exceptions to the levy of customs duty under section 12 on all goods imported. Hence, these provisions must be applied with due diligence and after recording the facts and also the satisfaction of the officer as required. In this case, the quantity of goods declared was 1,192.30 square metres while on examination 2,530 square metres was found. The adjudicating authority reduced it by 20% (towards corner cuts) and considered only 2,024 square metres as imported. Although the excess quantity imported was 1,307.70 square metres (2,530 1192.30) he confiscated only 831.70 square metres (2,024 1,192.30). The excess quantity of goods found are liable for confiscation under section 111(l) - The confiscated goods were valued at Rs.21,89,084 and hence the fine of Rs.5,00,000/- is fair and we find no reason to interfere with it. Likewise, the penalty of Rs, 1,20,000/- imposed on the appellant is also fair and we find no reason to interfere with it. If the goods are redeemed under section 125(1), the importer also has to pay customs duty under 125(2). Therefore, the demand of duty also deserves to be upheld. We, therefore, answer questions (f), (g) and (h) in favour of the Revenue and against the appellant. The appellant s prayer for interim relief by releasing only the quantity of goods actually declared cannot be accepted because there is no provision for giving customs out of charge to only a part of the goods under section 47. The appellant could have redeemed the goods as per the order of the Additional Commissioner and still pursued the appeals - Appeal dismissed.

Issues Involved:
1. Mis-declaration of quantity of imported polished marble slabs.
2. Duress in accepting the measurement and waiving the show cause notice.
3. Acceptance of quantity declared in the invoice and packing list.
4. Impact of hairline cracks, chemical damages on the quantity of marble imported.
5. Abatement towards corner cuts.
6. Liability of mis-declared quantity for confiscation.
7. Fairness of the redemption fine imposed.
8. Fairness of the penalty imposed.

Detailed Analysis:

1. Mis-declaration of Quantity:
The appellant declared 1,192.30 square metres of marble slabs in the Bill of Entry, but upon examination, 2,530 square metres were found. The adjudicating authority allowed a 20% deduction for corner cuts, resulting in 2,024 square metres. Thus, the appellant mis-declared the quantity, as confirmed by the physical examination conducted in the presence of the appellant's representative.

2. Duress in Accepting Measurement:
The appellant claimed that the letters accepting the measurement and waiving the show cause notice were given under duress. However, there was no evidence to support this claim. The letters were not withdrawn, and the appellant's acceptance of the examination and request for 35% abatement instead of 20% indicated no duress.

3. Acceptance of Declared Quantity:
The appellant's request to accept the quantity declared in the invoice and packing list was rejected. Customs duty must be levied on the actual quantity imported, not the declared quantity. The declared quantity cannot be considered if it differs from the actual quantity found during examination.

4. Impact of Hairline Cracks and Chemical Damages:
The appellant argued that hairline cracks and chemical damages should be considered for abatement. However, abatement of duty under section 22 of the Customs Act is applicable only if the damage occurred before, during, or after unloading but before examination due to an accident. The quantity of goods does not change due to such damages.

5. Abatement Towards Corner Cuts:
The adjudicating authority allowed a 20% abatement for corner cuts, but the appellant sought 35%. There is no legal provision for reducing the quantity of imported goods due to corner cuts. Abatement under section 22 applies to duty, not the quantity of goods imported. Therefore, the claim for a higher abatement was rejected.

6. Liability for Confiscation:
The excess quantity of marble slabs (831.70 square metres) was liable for confiscation under section 111(l) of the Customs Act. The adjudicating authority's decision to confiscate the excess quantity was upheld.

7. Fairness of Redemption Fine:
The redemption fine of Rs. 5,00,000 imposed on the confiscated goods valued at Rs. 21,89,084 was deemed fair and proper. There was no reason to interfere with the adjudicating authority's decision.

8. Fairness of Penalty:
The penalty of Rs. 1,20,000 imposed under section 112(a) of the Customs Act was also found to be fair and proper. The demand for duty on the excess quantity was upheld.

Conclusion:
The appeal was dismissed, and the impugned order was upheld. The appellant's claims for interim relief, including the release of non-offending goods and waiver of demurrage and detention charges, were rejected. The Tribunal found no satisfactory grounds to interfere with the adjudicating authority's decisions.

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