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TMI Blog2025 (1) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... national Trading Company. 1.1 The brief facts leading to this case are that Directorate of Revenue Intelligence, Surat intercepted Vehicle No. GJ 12BV 0610 on 01.09.2022 near Palsana Chowkdi on the National Highway, Surat. During interception, 107 cartons of e-cigarettes were found. Simultaneously the DRI Gandhidham gathered intelligence that container bearing No. TGBU5160748 was imported by Shri Asif Sathi and Shri Sarfaraz in name of J.H. Enterprises and suspected to have concealed e-cigarettes. It was found that the above persons imported around 18 containers in the month of September 2022 and lying at different places. During examination of the 18 containers, it was found that the Appellants including the other importers mis-declared description of the goods. Further, some of the import consignments were found containing mobile phone accessories such as tempered glass, earphone/headphone/back cover etc. having marking different companies, such as Samsung, Boat, Vivo, Oppo, apple etc. The most of the goods were found mis -declared with respect of their description, value and quantity etc., 1.2 During the investigation, statements of various persons were recorded. The DRI offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of imported goods, ensuring it reflects the true international market value for similar quality and quantity imports from the same country. 2.2 He further submits that the Ld. Adjudicating authority ought to have appreciated that the Appellant addressed various letters to the customs department stating that the valuation adopted by the Chartered Engineer is highly excessive and requested re-valuation of the imported goods. But, the department failed to consider such request of the Appellant. Hence, the valuation adopted by the Chartered Engineer is required to be discarded at the outset. 2.3 Without prejudice, he also submits that the goods imported by the importer are freely available in the market (online and offline market / retail market). He submitted the print outs obtained from the website of www.amazon.in showing the price of various similar / identical products in online market for illustration purpose. Copies of print outs obtained from the website of www.amazon.in showing the price of various similar / identical products in online market. 2.4 He argued that the retail price available at online market changes from company to company, size, quantity, nature of product, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation report. As pointed above, there were many deficiencies in the valuation report provided by the Chartered Engineer and therefore, the valuation provided in its report is not justifiable and such report cannot be considered for valuing the present consignments. Therefore, the impugned order is illegal and contrary to the provisions of law and the same deserves to be quashed and set aside. 2.8 He also submits that Ld. Adjudicating authority failed to appreciate that the statements of the Appellants, Shri Tahir Menn, Shri Parvej Alam, Shri Baldevsinh Vala, Shri Hanif Kapadia were recorded from time to time by the department, but no question was raised in respect of valuation of the imported goods like exercise book, Hair Trimmer, Back Cover, Tempered Glass etc. and therefore, the Respondent has not put any evidence with respect to discard the value of the goods declared by the Appellants apart from the report of Chartered Engineer. The Respondent ought to have first investigated the case in respect of valuation of the goods whether the Appellant correctly declared value or not. The investigating authority ought to have sought justification for value of the imported goods from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant to use their IEC and has never raised any objection for such use of IEC. In such circumstances, the basis for denial of import in the name of IEC is completely baseless and illegal. Further, the IEC holder has always participated in the investigation and adjudication proceedings and therefore, the Appellant cannot be made liable for the use of IEC. The Ld. Commissioner ought to have appreciated that the department has not produced single evidence to show that the Appellant was involved/abetted in the alleged offence. In such circumstances, the case booked against the Appellant is illegal and not sustainable in the provisions of law. 2.12 He also submits that the Ld. Commissioner erred in holding that the Appellant had willingly and deliberately indulged in the conspiracy of importing and clearance of prohibited goods i.e. Toys and other offending goods. The Ld. Commissioner ought to have appreciated that had there be any involvement of the Appellant in the alleged import, the department could have unearthed some evidence to that effect like correspondences, chat, diaries, flowback of money, accounting entries, etc. Failing which, the action of Respondent is totally illegal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 3 of the Rule and therefore, Section 111(m) is not attracted in the facts and circumstances of present case. 2.16 He also submits that the Ld. Commissioner erred in holding that the Appellant -Asif Sathi was the mastermind in the disputed transactions and therefore, he is liable to pay penalty under various sections under the provisions of Customs Act, 1962. It is pertinent to note that the said finding is without any direct/indirect evidence to establish that the Appellant had any knowledge of the alleged act. In the present case, there were no evidence/documents placed by the Revenue which shows that the Appellant had intentionally mis-classified the imported goods and therefore, penalty cannot be imposed. 3. On other hand Shri Sanjay Kumar, Ld. Superintendent (AR) appearing on behalf of the Revenue reiterates the findings of the impugned orders. 4. Heard both sides and after considering the submissions of both the parties and perusal of the material on records we find that present case arises out of examination and seizure of the imported goods pertaining to 18 import consignments. We find that M/s Skyblue International Trading Company have imported total 5 import consignme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng at the assessable value. The Chartered Engineer also failed to provide the details with respect to who were the suppliers / manufacturers for the goods which were examined against the imported goods to arrive the conclusion that the disputed goods are undervalued. Also, what were the differences with respect to the specification and characteristics of the goods making it differentiable with respect to the imported goods. It is also not provided what quality parameters were examined so as to differentiate the two products. 4.2 Firstly, the Chartered Engineer ought to have ascertained international price of the disputed goods. Goods imported by the Appellant are easily available in the international market. In terms of the Customs Valuation Rules for imported goods, the Chartered Engineer ought to have ascertained whether any other importer in India, imported the identical or similar goods from the same supplier and/or from the same country. If it is found that none of the importers, imported identical and/or similar goods in India from the same country, then, the Chartered Engineer ought to have adopted the value of the goods available in domestic market. We find the report reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs, reducing the per-unit cost. Thus, the value or cost per unit for small quantity of imports is generally higher than for bulk imports. 4.4 We find that The Chartered Engineer failed to provide any details with respect to which same / similar products were examined before arriving at the assessable value of the goods. He was obligated to provide all the details of same / similar product in the local market like place of dealer / seller of the local market and its credibility in the local market, Reliability of such local dealer, reasons for non availability (if any) of particular product, demand and supply of such product from different suppliers / manufacturers etc. The Chartered Engineer made a conclusive report and provided the market value of the goods without explaining the statistics as to how the market value has been arrived by him. 4.5 In such circumstance there are no reasonable grounds/justification on record to enhancement of value based on Chartered Engineer's certificate by applying Valuation Rule 9 of CVR, 2007. On the report of Chartered Engineer, the enhancement of the value by the Ld. Commissioner in the present matter legally not correct and we therefore set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... direct respondents to release the goods within 48 hours from today." Similarly, In the matter of Proprietor, Carmel Exports & Imports v. CC, Cochin - 2012 (276) E.L.T. 505 (Ker.), it was held as under: "15. Coming to the submission that the appellant is only a "name lender" for the import of goods by one Anwar, we shall presume for the time being that the appellant is only a name lender, but the actual beneficiary of the import is one Anwar. We called upon learned counsel for the respondents to place the relevant provision which prohibits such an activity on the part of an Import Export Code Number holder. Learned counsel for the respondents categorically made a statement that he is not able to place any such prohibition in law except Section 7 of the Foreign Trade (Development and Regulation) Act, 1992, which reads as follows :- "7. Importer-exporter Code Number. - No person shall make any import or export except under an Importer-exporter Code Number granted by the Director-General or the officer authorised by the Director General in this behalf in accordance with the procedure specified in this behalf by the Director General". The expression "import" occurring in the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 112(a) can be invoked in the situations as prescribed. In the present case, since none of the situations is covered and therefore, penalty under Section 112(a) cannot be imposed. The term "abetment" is defined under Section 107 of the Indian Penal Code 1860 as under: "107. A person abets the doing of a thing, who First - Instigates any person to do that thing; or secondly - Engages with one or more other person or persons in any conspiracy for the doing of that thing, if an act or illegal omission takes place in pursuance of that conspiracy, and in order to the doing of that thing; or Thirdly - Intentionally aids, by any act or illegal omission, the doing of that thing.: Explanation 1 : A person who, by willful misrepresentation, or by willfully concealment of a material fact which he is bound to disclose, voluntarily causes or procures, or attempts to cause or procure a thing to be done, is said to instigate the doing of that thing" Penalty under Section 112 (a) of the Act can be imposed only if it proves beyond doubt that the person concerned and by his act of omission or commission rendered the goods liable for confiscation or is held that the said goods with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... side the penalty imposed under Section 114AA of the Customs Act, 1962 on both the appellants." 4.12 In the case of Jitender Singh [2019 (369) E.L.T. 1683 (G.O.I.) following has been held :- "4. Government also agrees with the applicant's plea that penalty under Section 11AA of Customs Act, 1962 is also not maintainable in this case as the Section is attracted only where false declaration/statement document is used. But no such false declaration, etc., was made by the applicant and rather the case against the applicant is that he did not declare the TV to the Customs authorities for which Section 112 is appropriately attracted. Therefore, the justice and fairness demands that penalty of Rs. 25,000/- will be sufficient under Section 112 of the Customs Act on the applicant in this case for carrying the TV for ulterior design of smuggling of TV for monetary consideration." In the light of the above, there is no reason whatsoever to impose penalties on the three Appellants namely Shri Hanif Kapadia, Shri Parwej Alam and Shri Dirgesh Dhedhia, accordingly penalties imposed on the said appellants are liable to be set aside.. 5. In view of the above discussions and findings, we pass th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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