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TMI Blog2024 (3) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... s rejected. Therefore with the support of the above referred judgment and particular facts of the present case, the impugned order on the issue of classification is not sustainable. Whether the value of the imported RPO can be enhanced based on the consent letters given by the directors of the Appellants at the time of release of the goods, without following the due process of law as contemplated under Section 14 of the Customs Act read with Customs (Determination of Value of imported value) Rules, 2017? - HELD THAT:- In the present case neither any contemporaneous value was adopted nor any method as prescribed under Section 14 read with Custom Valuation Rules, 2007 was followed. Therefore, merely on the basis of statements of director valuation cannot be enhanced. Therefore, the enhancement of the value is not sustainable in the facts of the present case. This similar issue has been considered in the case of GURU RAJENDRA METALLOYS INDIA PVT LTD VERSUS C.C. -AHMEDABAD [ 2020 (6) TMI 68 - CESTAT AHMEDABAD] wherein the tribunal held that only on the basis of the consent letters of the importer enhancement of valuation cannot be made - the enhancement of the value by the lower author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -declared the country of origin in the bills of entry. Consequently, the Learned Commissioner (Appeals) upheld the finding of the Adjudicating Authority and dismissed the appeal preferred by the appellant. Therefore, the present appeals. 1.2 The following four issues are involved in the present appeals:- (i) Whether the Rubber Processing Oil imported by the Appellant is classifiable under Chapter Heading No. 27101990 as classified by the Appellants or under Chapter Heading No. 27079900 as classified by the Revenue. (ii) Whether the value of the imported RPO can be enhanced based on the consent letters given by the directors of the Appellants at the time of release of the goods, without following the due process of law as contemplated under Section 14 of the Customs Act read with Customs (Determination of Value of imported value) Rules, 2017. (iii) Whether the Appellants mis- declared the Country of Origin in the Bills of entry filed by them. (iv) Whether the quantum of penalties and redemption fine imposed disproportionate to differential duty involved in the matter. 1.3 The order of the Adjudicating Authority was based on the test report of Custom House Laboratory at Kandla. Few t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iginated from Iran. He submits that the appellant had no deliberate intention not to declare the correct country of origin, the appellant declared country of origin based on documents received from the supplier. He takes support in case of BEL India trade Pvt. Ltd. vs. Commissioner of Customs 2007 (216) ELT 441. 2.4 Without prejudice to the aforesaid, he further submits that even though if the appellant accepts the finding of both the lower authorities, penalties and redemption fine imposed on the appellants are disproportionate to the differential duty amount involved in the impugned proceedings. Without prejudice to the aforesaid, it is also submitted that there is no intention on the part of the appellant or the director to evade custom duty, the appellant have classified the disputed goods under Chapter Heading No. 27101990 based on valuation under same heading and the decision of Sah Petroleum Ltd (Supra) however, value ought not to have been enhanced on the basis of the Consent letters. There is no undue benefit in declaring another country of origin. Therefore, he prays that the appeals may be allowed with consequential relief. 3. Shri Ashok Thanvi, Assistant Commissioner (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case are that the appellant filed Bill of Entry No. 7638694 dated 11.08.2012 with Custom House, Kandla for clearance of 198 MT Rubber Processing Oil for assessment on first check basis. The appellant has classified goods under CTH 27101990. The appellant presented Quality Certificate No. TOP 2012/COQ-148 dated 28.08.2012 received from overseas supplier M/s. The Oceanic Petroleum Source Pvt. Ltd, Singapore showing among other parameters, Aromatic content as 33.8% measured by adopting ASTM D 2140 method. Geo Chem laboratory vide report dated 06.10.2012 as per which reported the aromatic content of 35%. The claim of the appellant is that aromatic content was less than the non-aromatic content. The goods were assessed provisionally and clearance was permitted. The test report dated 26.09.2012 issued by custom laboratory, Kandla in respect of sample drawn by customs reported aromatic content as above 50% i.e. more than non-aromatic constituents. On the basis of this test report, balance quantity of 63.600 MT were placed under seizure on 19.09.2012. On the basis of the customs laboratory report classification declared by the appellant was rejected and has ordered for final assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cord, wherein he made detailed submission on facts and merit of the case. He also placed reliance on the following Judgments:- Sah Petroluems Ltd. V/s. Commr. Of Cus. (Import) JNCH, Nhava Shev -2017(358) ELT 483 (Tribunal - Mumbai) Agrawal Industrial Corporation Ltd. v/s. Commissioner Of Customs, Manglore, 2020 (373) ELT 280 ( Tri.- Bangalore) Surbit Impex Ltd.-2012(283) ELT 556 (Tri.- Mumbai) Mittal International -2018 (359) ELT 527 (Tri. -Del) Jay Kay Exports -2003 (161) ELT 443 (Tri. -Kol) 3. On the other hand Shri Ajay Kumar Samota, learned Superintendent (AR) appearing on behalf of the revenue reiterates the finding of the impugned order. 4. We have carefully considered submissions made by both the sides, and perused the rerecords. In the present appeal, issue to be decided by us in the appeal filed by M/s. Amit Petrolubes Pvt Ltd are as under :- i. Classification of Rubber Processing Oil (RPO) ii. Country of origin of said goods iii. Enhancement of declared value twice. 4.1. As regards classification of Rubber Processing Oil (RPO), we find that was held by the revenue under CTH 27079900 treating the parameters of aromatic constituents is 50% i.e. more than non-aromatic consti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny concession on the basis of country of origin the issue is only of aromatic content and having no revenue implication. Therefore no consequential penalty is sustainable. The very identical issue has been considered by the Tribunal in Agrawal Industrial Corporation Ltd. v/s. Commissioner Of Customs, Manglore, 2020 (373) ELT 280 ( Tri.- Bangalore), whereby the Hon ble Tribunal has set aside the redemption fine and penalty imposed under Section 112(a) and 114AA of Customs Act, 1962 on the ground that the country of origin was mis-declared in the bill of entry by taking note of the fact that the importer had not claimed any preferential rate of duty on this basis. 4.6. Considering the said decision of the Tribunal and fact of the present case, we hold that no penalty is sustained on this ground. 4.7. As regards the 3rd issue i.e. enhancement of the value of the imported goods twice, we find that once the value was enhanced from USD 500 PMT to USD 515 PMT , which was accepted by the appellant. However, the value was further enhanced to USD 585 only on the basis of one invoice bearing No. TOP SPL /CP/34 dated 09.07.2012 produced by the shipping agent. 4.8. On this basis, the assessable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is any doubt on the valuation, the due process of law as contemplated under Section 14 of the Customs Act read with Customs (Determination of Value of imported value) Rules, 2017 must be complied with. However, in the present case neither any contemporaneous value was adopted nor any method as prescribed under Section 14 read with Custom Valuation Rules, 2007 was followed. Therefore, merely on the basis of statements of director valuation cannot be enhanced. Therefore, the enhancement of the value is not sustainable in the facts of the present case. This similar issue has been considered in the case of Guru Rajendra Metal Alloy wherein the tribunal held that only on the basis of the consent letters of the importer enhancement of valuation cannot be made. The case of Guru Rajendra supra is based on the Hon ble Supreme Court judgment in the case of Century Metal Recycling Pvt. Ltd. Vs. Union Of India reported at 2019(367) ELT 3 (SC). Therefore, as per settled law on the facts of the present case, the enhancement of the value by the lower authorities is without any legal basis. Hence, the same will not sustain and accordingly, the enhancement of the value done by the Revenue is se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot claimed any preferential rate of duty. After examining the provisions of Section 111(d) and 111(m), I find that both the provisions are not applicable in the fact and circumstances of this case. Further, I find that no mala fides has been brought on record on the part of appellant so as to impose penalties on the appellant under Section 112(a) and Section 114AA of the Customs Act, 1962. Further, I find that in the case of Oriental Containers Limited v. Union of India (cited supra), the Hon ble High Court of Bombay in para 9 has observed as under : 9. Having heard the Counsel on both the sides, we are of the opinion that in the present case, it is admitted by the Customs authorities that the petitioners are not party to the fraud and there was no mala fide intention on the part of the petitioners in importing the Tin Plate/Waste instead of Tin Plate Prime. In fact, the petitioners have paid to the foreign supplier the price of tin plate prime and in return got tin plate waste. The petitioners have paid the customs duty payable on Tin Plate Prime. Under the circumstances, when the petitioners are innocent victims of the fraud played by the foreign supplier and the petitioners have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the goods will fall is the ultimate job of the Customs authorities and if the Appellants have claimed wrong classification according to his limited understanding of the Customs Law, mens rea cannot be attributed to him. Accordingly, we hold that in the present matters, it cannot be claimed by the Revenue that the Appellants have deliberately misdeclared the goods with a view to avail the benefit of lesser rate of duty. We, therefore, set aside the confiscation and consequently the redemption fine imposed on them in both the appeals as well as the penalty. 7. In view of my discussion above, I am of the considered view that the impugned order is not sustainable in law and therefore I set aside the impugned order in totality and allow the appeal of the appellant with consequential relief, if any. 4.4 From the above decision it can be seen that in identical circumstances, this Tribunal held that for incorrect mention of country of origin, the importer cannot be penalized. Accordingly, in the present case also considering overall facts and the fact of incorrect declaration, if any, regarding country of origin in the Country of Origin Certificate, the appellant is not liable for an ..... 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