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TMI Blog2011 (3) TMI 1446X X X X Extracts X X X X X X X X Extracts X X X X ..... ED BY : Written submission by the Appellant. Shri R. Nagar, SDR, for the Respondent. [Order per : B.S.V. Murthy, Member (T)]. The appellant M/s. Silk City Petrofils Co. Ltd. (SCPL) has two units in special economic zone at Kandla (SEZ) for manufacturing and trading Ladies night wears, jackets, T-shirts, Gents Bermudas and similar other garments. SCPL filed two shipping bills for export from Kandla as detailed below : Sr. No. Shipping Bill No. Date Container No. KASEZ Seal No. Description of Goods Declared F.O.B. Value (Rs.) 1. 25402/ 14-8-2003 BLJU 292907/1012569 Ladies Night Wear, Ladies Jacket, Ladies T- Shirts (120 cartons) 44,91,547/- 2. 25403/ 14-8-2003 JAYU 1042175012569 Ladies Night Wear, Ladies T- Shirts, Gents Bermudas (124 cartons) 43,55,790/- 2. Suspecting over invoicing, the consignment was examined and after investigation, issue of show cause notice, impugned order has been passed confiscating the garments covered by the shipping bills and allowed to be redeemed on payment of fine in lieu of confiscation of Rs. 8 lakhs. Further penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edi, Director of M/s. Vishnupriya Dyeing Printing Mills Pvt. Ltd., Surat and Shri Bhup Singh Daulatram, Director of M/s. Siddhi Vinayak Dyeing Printing Mills stated that the samples shown to them were printed fabrics which were not processed by them and they were not equipped for processing printed fabrics and also stated that the value of the finished products declared by them in the invoice was as per the instructions of Shri S.T. Arora of ST. Shri Anilkumar R. Tulsian, Director of M/s. Gomti Silk Mills (GSM), stated that they had manufactured printed fabrics out of grey fabrics received by them and price was declared on the basis of value of grey fabrics communicated to them by ST. Shri S.T. Arora when his statement was recorded subsequently agreed that the rates mentioned in the invoices by the job workers was as per instructions given by him and he also agreed with the prices ascertained in the market survey by the Customs. Shri Shyamsunder Satyal, authorised signatory agreed with the facts as brought out by Customs Department. 5. In the written submissions, the learned advocate submitted the following points : Export was undertaken absolutely without any export benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore there cannot be any justification over imposition of penalty on him. 6. Learned DR reiterated the observations of the Commissioner in the adjudication order and submitted that this was a case of overvaluation of export goods. But for the intervention of the customs, the supplier of fabrics to SCPL would have claimed the DEPB benefit as per the exim policy. Even if DEPB is in lieu of drawback, it would only mean that an assessee has to choose between DEPB and drawback and it does not mean that the DEPB amount cannot be more than the drawback amount. He also submitted that SCPL and ST were managed by a single person and were sister concerns. Further he also submitted that all the job workers clearly admitted that the invoice price was mentioned as per the instructions of Shri S.T. Arora. In the case of GSM, value of grey fabrics was furnished by Shri S.T. Arora and on that basis, GSM had declared the value. Thus in reality value of all the fabrics manufactured on job work basis was dictated by ST only thereby facilitating inflation of value of the export goods. He also submitted that Shri S.T. Arora had not questioned the market value ascertained by the Revenue in his sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugs and it was observed by the Hon ble Supreme Court that the Tribunal s observation that the adjudicating authority had arbitrarily computed the FOB value and there was no concrete evidence produced by the department to show that their FOB price is inflated. In this case we have already seen that department has produced evidence and therefore this decision is of no help. In the case of Frost International Ltd. v. CC (Exports) reported in 2006 (76) RLT 388 (CESTAT) = 2006 (206) E.L.T. 451 (Tribunal) also the decision was given in favour of the exporter since Revenue had not produced any evidence. There was no market enquiry made to show that PMV declared was not correct. In the case of Polynova Chemical Industries v. CC, Mumbai reported in 2005 (179) E.L.T. 173 (Tri.-Mumbai) also, there was no evidence of inflation of local market value. In the case of Texool Wastesavers reported in 2009 (236) E.L.T. 324 (Tribunal) the issue related to import of goods and not exports. Thus we find that all the decisions cited by the learned advocate are not relevant to the facts of the case and hence are not applicable. 10. It was submitted that the department has come to the wrong conclusion tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upply by ST to SCPL is deemed export, the value declared by ST to SCPL also becomes relevant since it is treated as export and in view of the inflation of value by ST which automatically result in inflation of value by SCPL, the conclusion of the Commissioner that the goods are liable to confiscation since the same did not correspond with the value declared has to be upheld. The fact that BRC contained DEPB also is not relevant in our opinion since as submitted by the learned advocate, nowhere in the order of the Commissioner there is a discussion as to how SCPL could have claimed DEPB benefit if the shipping bill filed was a free shipping bill. Therefore the observations of the Commissioner regarding BRC to support the contention that appellant SCPL intended to claim DEPB cannot be sustained. However we agree with the view that at the time of initiation of transaction itself, appellants had planned to claim DEPB or drawback whichever is more beneficial to them and with that object only, the whole operation was planned. The fact that FOB value was realized does not take away or does not help the appellants to rebut the contention of the department that value was inflated by ST whil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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