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TMI Blog1989 (2) TMI 288X X X X Extracts X X X X X X X X Extracts X X X X ..... equipment is stated in the OGL APP. 1 Part B List 8 Item No. 39 of Import Export Policy 1985-88. The goods are in very good condition and as per your order dt. 12-12-86. The equipments comprise the following: (a) Four - DN Negative Processors Serial Nos. 3924,2525,3914 3923. (b) Four Colour Printer Serial Nos. 2225, 2161,1911 1907. (c) Four Film Dryers. (d) Four sets of wooden cabinet stands for the film processors and printers." 2. As the goods imported were second-hand, a certificate dated 27-1-1987 issued by Daplas Electronics (P) Ltd., Chartered Engineers, certifying that the following 4 sets were KIS Mini Lab Colour Photographic Processing System viz., (a) DN Negative processors Sl. Nos. 3924, 2525,3914 3923. (b) Magnum speed printer Sl. Nos. 2225, 2161,1911 1907. together with their associated Film Dryers and Wooden Cabinet stands for the above mentioned sets were inspected and the age of the machine was certified as 3 years and the then value of the same was US $ 2,000/- per set. The importers also produced a copy of catalogue of M/s. KIS INDUSTRIES (P) LTD., for the KIS Mini Lab system as well as KIS Colour Analyser. In the catalogue it is clearly s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rded. The value declared was found to be very low. At the time of filing of the bill of entry the importers had produced xerox copy of catalogue of KIS Mini Lab System. The same catalogue was produced by Shri K.A. Basheer when his statement was recorded on 30th March,1987. The department obtained a quotation from M/s. KIS Industries Pvt. Ltd., Singapore through a source. According to the said quotation the price of 1 Unit KIS Mini Lab Magnum speed was found to be US $ 22,750 GIF Madras. 5. As per the detailed examination report, the importers had imported 17 complete units of KIS Mini Lab system (both used and new) apart from a few pieces of colour printers, film dryers and cabinets as well as other items viz., (a) 2 Nos Vacuum Cleaners (used) (b) 2 Nos Water Pumps (used) (c) 1 No Air-conditioner (used) with Stabilizer (d) 1 No Steel Cash Box (used) (e) 4 Nos Cotton Shirts (new) (f) 2 Nos Wooden Tables (used) (g) 5 Nos Steel Stools (used) (h) 8390 Nos Negative Wallets in 3 packages (i) 50 Nos Plastic Spools (used) (]) 50 kgs. used wires. 6. These items were found imported as against the declaration of 4 sets of secondhand KIS brand still photography processi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the item Appraised value (In Rs.) 13 s ets of second-hand KIS brand still photographic processing printing equipment 17,24,878 2 Nos. Colour Printers 1,20,000 1 No. Film Drier 30,000 9 Nos. Wooden Cabinet Stand 22,500 9. The following goods were also confiscated under Section 111(m), (1) and (d) of the Customs Act. However, the same were allowed to redeemed on payment of a fine of Rs. 5 lakhs under Section 125 of the Customs Act, 1962 :- (i) 4 sets of second hand KIS brand still photographic processing printing equipment having Serial Nos. 3924, 2525, 3914 and 3923 in the negative processors and 2225, 2161,1911 and 1907 in the printers (i) 4 sets of second hand KIS brand still photographic processing printing equipment having Serial Nos. 3924, 2525, 3914 and 3923 in the negative processors and 2225, 2161,1911 and 1907 in the printers Rs. 5,30,732 (ii) 2 Nos. Vacuum Cleaners (used) 1,000/- (iii) 2 Nos. Water Pumps (used) 200/- (iv) 1 No. Air-conditioner with Stabilizer (used) 1,500/- (v) 1 No. Steel Cash Box (used) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In 1984 KIS Magnum Model was introduced and this could produce three sizes of photographs viz., 3R, 4R and 5R. The machine could be loaded with two different sizes of paper at the same time. The production of this Model was stopped in 1985. In 1985 KIS Magnum Speed Model was introduced. The basic feature of this Model is the same as that of the Magnum except the speed is faster than that of Magnum. KIS Mini Lab system comprised of four standard components. The chemical preparation and storage unit, the Negative Processor, the Printer and the Film Dryer. A letter to this effect is part of the paper book (Page 115) filed by the Respondent. The said letter dated 20th August, 1987 is written to Shri K.A. Basheer by M/s. KIS Industries (Pvt) Ltd. Shri Lakshmikumaran, the learned Advocate has drawn the attention of the Bench to the Inspection Report of the Appraiser, which appears from pages 1 to 8 of the paper book filed by the Respondent and to the Bill of Entry filed by the appellants which appears on pages 9 10 of the Paper book. Shri Lakshmikumaran states that the Revenue s examination report clearly shows that the machine imported is Papier Model which is at Sl. No. 109 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s had again produced the same catalogue. Only at the stage of replying to the show cause notice and during the personal hearing the claim was made by the appellants that the catalogue did not pertain to the goods imported. Shri Durghayya argued that even the Chartered Engineer s Certificate clearly indicates that the four sets of equipments at Sl. Nos. 2225, 2161, 1911 1907 were Magnum Speed Printers and the Chartered Engineer s Certificate was produced by the appellants for their claim under OGL and for valuation of the goods. Shri Durghayya argued that the goods on examination were found to be in agreement with the description given in the catalogue and in the Chartered Engineer s Certificate. The appellants had declared the value of the goods at US $ 8,000 which is equivalent to Rs. 1,06,146 and the Revenue has assessed the value of the same at more than Rs. 24 lakhs. The appellant had claimed that the equipment imported was Papier Model whereas as per the Revenue it is Magnum Model. Shri Durghayya has referred to the letter written by DBS Finance Ltd. to M/s. Premier Commercial Enterprises dated 9th September, 1986 which appears on page 31 of the Respondent s paper book. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e upto 1983-84 and this fact has been accepted by the Collector. Magnum speed model was introduced in the year 1985. Shri Lakshmikumaran, the learned Advocate has stated that even for the sake of argument if it is taken that the importation was unauthorised merely on account of non-furnishing of a certificate from the Chartered Engineer the appellants should have been given an option to redeem the goods after payment of fine. He has again pleaded for the acceptance of the appeal. 14. We have heard both the sides and have gone through the facts and circumstances of the case. Facts are not in dispute that in the Bill of Entry, the appellants had given the description as Four sets of second-hand KIS brand still PHOTOGRAPHY PROCESSING AND PRINTING EQUIPMENT and the value was declared at Rs. 1,06,146 and the value as per invoice was CIF US $ 8,000/-. We have also gone through the Chartered Engineer s Certificate, which is reproduced below :- Daplas Electronics (Private) Limited P.O. Box 195 Katong, Singapore 9143, CABLE : DAPRONICS TELEPHONE 414967 Your Ref: Our Ref: AW/COV/8701-1 Singapore 27th January, 1987 Singapore Colour Centre, 669, Mount Road, Mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... num. KIS mini lab system comprised of four standard components. The chemical preparation and storage unit, the Negative Processor, the Printer and the Film Dryer. The model name in all the three models is imprinted in the Printer. I hope the above details give sufficient information about our mini lab systems. Yours faithfully KIS Industries (Pvt.) Ltd. Sd/- PHILIPPE DARDEL Managing Director." 16. This letter was filed by the appellants before the Adjudicating authority. The genuineness of this letter has not been doubted by the Respondent. Para (i) of the said letter clearly says that Papier Model which is also known as TN/DN Model was manufactured until 1984. This model can only print one size of photographs and take only one size of paper. Para (ii) of the letter shows that KIS Magnum Model was intrduced in 1984 and this model could print three different sizes of photograph namely, 3R, 4R and 5R sizes, and the production of this Model was stopped in 1985. As per the Chartered Engineer s certificate the year of manufacture of the machines is 1983. The genuineness of the Chartered Engineer s certificate has also not been doubted by the Revenue authorities. The ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the examination reports says that most of the items are TN/DN it cannot be assumed that it is magnum model. Once the examination report is accepted, the Revenue authorities cannot assess the goods as Magnum Model. The mere fact that the appellants had attached the catalogue of Magnum Model cannot lead to the inference that the goods imported are Magnum Speed Model, especially when the Negative Processor and Colour Printers bear serial numbers as well as date of manufacture. We have perused in detail the examination reports dated 13-3-1987 and 16-3-1987. A close examination of the report shows the position of the Negative Processor and Colour Printers as under :- Relevant Extract from the Examination Reports dated 13/16-3-1987 (Pages 3 to 7 of the Respondent s paper book) Sl. No. Processors Sl. No. Printers 2. New 4. Old 5. New 9. New 1907 A 6. New 109. Used TN 1913 A 127. New DN 3914 125. Used TN 1895 A 128. New DN 3924 130. Used TN 2225 A 147. New DN3890 135. Used TN 1923 A 151. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6-83 19. A comparison of the Chartered Engineer s Certificate with the examination report dated 3-8-1987 will show that Colour Printer at Sl. No. 13 bearing No. TN 2225A was actually manufactured in January, 1984, whereas the Chartered Engineer has mentioned it as 1983. Thus the Chartered Engineer has not taken sufficient care even while issuing the Certificate. It will be dangerous to place complete reliance on the Certificate of the Chartered Engineer. Accordingly we are of the view that mentioning of the Magnum Model in respect of Colour Printers in the Chartered Engineer s certificate should not lead to the inference that the machines imported was Magnum Model. Keeping in view the totality of the facts and circumstances of the case and on detailed examination of the examination reports we hold that the machines imported by the appellants are Papier Models. 20. Now coming to the valuation aspect, in the invoice and packing list which appear at pages 16 and 17 of the Respondent s paper book, the value has been shown as US $ 8,000/- and the Chartered Engineer in his certificate had adopted the same value at US $ 2,000/- per set. The examination report shows that there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eproduced below :- 125. Option to pay fine in lieu of confiscation. - (1) Whenever confiscation of any goods is authorized by this Act, the Officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall, in the case of any other goods, give to the owner of the goods an option to pay in lieu of confiscation such fine as the said officer thinks fit: Provided that, without prejudice to the provisions of the proviso to subsection (2) of Section 115, such fine shall not exceed the market price of the goods confiscated, less in the case of imported goods the duty chargeable thereon. (2) For the removal of doubts it is hereby declared that any fine in lieu of confiscation of goods imposed under sub-section (1) shall be in addition to any duty and charges payable in respect of such goods." 22. A simple reading of the Section shows that where the goods have been imported in violation of the conditions of licence granted to the assessee, the goods are liable to confiscation under Section 111(d) of the Customs Act, 1962. In the matter before us the goods fall under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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