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TMI Blog2015 (1) TMI 669X X X X Extracts X X X X X X X X Extracts X X X X ..... ly to all purchasers. Since the cars are sold through the dealers, it is the dealer who gets the discount and not the retail purchaser and therefore, adopting the list price for determination of the assessable value cannot be said to be incorrect. There is no time limit specified for demand of duty under Section 125. - in the present case since the goods have been seized and confiscated under the provisions of under Section 111 (m) and 111 (o), liability to differential duty would automatically arise. In view of the said position, the liability to pay differential duty as demanded in the impugned order is clearly sustainable in law. Appellant had not intended to sell the car and the car is still in the custody of the of the appellant and therefore, considering the total cum duty value of about ₹ 59 lakhs, the redemption fine of ₹ 10 lakhs appears to be much on the higher side. Accordingly we reduce the redemption fine to ₹ 5 lakhs from ₹ 10 lakhs as confirmed in the impugned order. Demand of interest of ₹ 9,50,316/-, Section 125(2) does not provide for payment of interest. Further in the present case, interest has been demanded under the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ress at Bangalore and had gone back to Dubai in 2004 itself. The vehicle was found to be lying with Shri Behram Engineer, brother of Smr. Armaity S. Patel and Shri Engineer confirmed that Smt. Armaity S. Patel had gone back to Dubai, somewhere in October/November 2004 and the vehicle was lying with him. The vehicle which is a Toyota Land Cruiser was seized vide seizure Memo dated 28/06/2006 and was handed over to Shri Engineer for safe custody. The statement of Smt. Armaity S Patel could be recorded on 01/11/2006 wherein she confirmed that she had gone back to Dubai since her husband got extension to continue his service and, therefore, she handed over the car for safe custody to her brother. In order to ascertain the correct year of manufacture of the vehicle, the department wrote to M/s. Toyota Kirloskar Motors for providing chassis and engine number of the vehicle and seeking other details of the vehicles and the said Toyota Kirloskar Motors vide letter dated 30/10/2006 confirmed that date of manufacture of said vehicle to be 29/05/2003 and the list price in the year of manufacture was 5.588 million Japanese yen. In the light of the investigation carried out by the department, S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Counsel further submits that the duty demand has been confirmed under Section 125 (2) of the Customs Act. Therefore, the question of demanding interest under Section 28AB or imposition of penalty under Section 114A of the Customs Act is not in accordance with law. The lower appellate authority has ignored the contention of the appellant that in a case where conditions of a notification has been violated, the question of invoking provisions of Section 125 would not apply. The said provisions would apply only in a case where the details regarding bills of entry are not known or the goods are smuggled into India without filing any import documents. Alternatively, he contends that differential duty has been worked out without granting of benefit of 15% trade discount on manufacturers list price and the interest has been worked out contrary to the provisions of Notification No.78/2003-Cus dated 12/09/2003 which prescribes a fixed rate of interest @13% per annum. If this trade discount is granted, the differential liability would be only ₹ 14,52,227/- and the interest liability would be ₹ 5,97,624/-. Accordingly, he pleads for setting aside the impugned order and allowing th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d after giving depreciation for the two quarters cannot be said to be incorrect and consequently differential duty demand of ₹ 20,81,411/- cannot be disputed. 5.3 As regards the contention that Section 125(2) will not apply, this contention is misplaced. There is a condition in respect of cars imported under Transfer of Residence Rules, that the importer will stay in India at least for a period of two years. This condition has been clearly violated and therefore, the provisions of Section 111 (o) comes into picture. Similarly, there is a misdeclaration with respect to the year of manufacture and hence, misdeclaration of material particulars attracting the provisions of Section 111(m) is also established. Therefore, the impugned car imported under Transfer of Residence is clearly liable to confiscation. Once the goods are seized and found liable to confiscation, the provisions of Section 125 would come into picture. There is no time limit specified for demand of duty under Section 125. The said section clearly provides that when the goods are seized and allowed to be redeemed, the owner or the person from whom the goods are seized, shall be given an option to redeem the sam ..... X X X X Extracts X X X X X X X X Extracts X X X X
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