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TMI Blog2007 (9) TMI 502X X X X Extracts X X X X X X X X Extracts X X X X ..... hree shipping bills dated 21-2-2003 for export of goods declared as 100% poly and poly fabrics. The declared values C&F in terms of the US $ are 1.19 per metre (Rs. 57 per metre). These exports were done under the DEPB Scheme by which the exporters are entitled for the duty credit which can be used for paying duty on imported goods. Initially the goods were allowed on a provisional basis for export under the scheme. As there was doubt about the values declared by the appellants, samples were taken and subjected to chemical test. In order to find the correct market value of the goods, the samples were taken for market inquiries and verification. It is seen that, the appellants have declared a very high value for the goods which will help them in getting more credit. The value declared was about Rs. 57/- per metre, whereas on market inquiries the values ranged from Rs. 7 to Rs. 13. Further, it was found that the goods were of very poor quality and they had damaged the appearance. Some samples were forwarded to Textile Committee, Kannur, who reported that the goods were made of polyester of a weight per linear metre ranging from Rs. 21 to Rs. 27 metre. Since the value declared by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r buyer and fully eligible for foreign exchange. No loss of Revenue was caused to the State by their export covered under the DEPB shipping bills. On the contrary, the State was enriched in terms of the foreign exchange earned. 7. The Commissioner was wrong in mentioning that the quality, quantity and value of the impugned goods had been mis-declared. As regards the quality, they declared that the goods are 100% poly and poly dyed/PTD Fabrics. The test results by the Textile Committee, Kannur, indicated the same type of fabrics. The export of the fabric cover was based on measurement in terms of length and not based upon measurement in terms of weight. 8. The Commissioner is not justified in stating that the value has been mis-declared by the exporter with an intention to avail excess DEPB credit. It was argued in the grounds of appeal that the amount of DEPB claimed by the appellants does not exceed 50% of the present market value (PMV). Even if they had declared the PMV as low as stated in the order passed by the Commissioner, they would have been entitled for the same amount of DEPB credit. Therefore, it cannot be said that the appellants mis-declared the PMV for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mencement of 2002, but the market survey by the Customs was done during mid of 2003. In such a long gap of period, there will be substantial changes in the price. The Commissioner has not taken into account various expenses incurred in fixing the value. He has just added Rs. 3 per metre towards profit as well as transportation cost and other incidental charges. 14. The learned Departmental Representative stated that the appellants who are from Gujarat have come to the Cochin Port all the way from there in order to export the goods and claim undue benefit under the DEPB Scheme. He stated that, the goods on test were found to be of inferior quality. The market inquiry was done only from traders/manufacturers/processors dealing with these types of goods in Surat. There is also mis-declaration of the net weight of the impugned goods. In any case, the value declared by them for DEPB purposes comes to Rs. 57/- per metre. As the DEPB rate is dependent on the FOB value declared, a higher value will ensure that the appellants gained higher DEPB. Therefore, there is absolutely no merit in the various contentions raised by the appellants. 15. None appeared on behalf of the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In terms of para 4.41 of Chapter IV of the Foreign Trade Procedure, in respect of products where the rate of credit entitlement under DEPB Scheme comes to 10% or more, the amount of credit against each such export product shall not exceed 50% of the present market value (PMV) of the export product. The Government of India is very much conscious of the mis-use of the scheme and, therefore, the credit has also been restricted as mentioned above. We have also gone through the plethora of case laws furnished by the learned Departmental Representative. The Hon'ble Apex Court in the case of Om Prakash Bhatia v. CC, Delhi, 2003 (155) E.L.T. 423 (S.C.), has dealt with the over-invoicing of export goods. It has been held that, when the importation or exportation of the goods are subjected to certain prescribed conditions to be fulfilled either before or after clearance of the goods, and if those conditions are not fulfilled, the said goods would be considered as prohibited goods and Sections 2(23), 11 and 113(d) of the Customs Act, 1962 would come into play and the exporters would be liable for penalty. In the case of Abishek Export v. CC, Cochin, 2007 (208) E.L.T. 155 (T-Bang.), the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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