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TMI Blog2001 (11) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... alue of the goods at around Rs. 23.4 lakhs (FOB) as against the declared value of over Rs. 2.3 lakhs (CIF Goa). He confiscated the goods under Section 111(m) of the Customs Act, 1962 and gave the appellant an option to redeem the goods on a payment of fine of Rs. 2.5 lakhs. A penalty of Rs. 50,000/- each was also imposed on M/s. U.K. Enterprises, Shri Devender Kumar Chopra, and Shri Jawahar Lal Luthra under Section 112 of the said Act. The appeals of the parties seek vacation of the penalties and fine, while the appeal of the Revenue prays for enhancement of the redemption fine and penalty on the importer. Since all the appeals related to the same case, they were taken up for hearing together and are disposed of by this common order. 2.Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40,492.49 (SAY TOTAL H.K. DOLLARS FORTY THOUSAND FOUR HUNDRED NINTY TWO AND CENTS FORTY NINE ONLY) TOTAL 20 CTNS ONLY. 3.On the basis of intelligence that the consignment had been grossly under-valued. The Directorate of Revenue Intelligence (DRI) authorities at Goa examined the consignment. Upon examination of the consignment, certain stickers and labels indicative of the particulars of manufacture and transport of the goods by Air etc. were found inside the cartons in which the I.Cs were packed. Shri Satish Kumar Luthra from Delhi who was following up on the Custom clearance of the consignment informed the DRI officers that he was a dealer in electronic goods and was the brother of Mr. Jawahar Lal Luth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is high probability that they have supported the Hong Kong customer". They also supplied the value of the I.Cs in question. 5.Thus, the manufacturers of six out of the seven varieties of I.Cs furnished to the investigating authorities full particulars of the description of the goods and their actual cost. It was found that the value of these goods, according to information furnished by the manufacturer came to several times the value declared by the importers. The Customs authorities increased the value of NEC I.Cs also proportionately and fixed the value of the entire goods. Addition of 10% towards the profit of the dealer in Hong Kong was also added. Thus, fixing the value of the goods at Rs. 23.4 lakhs. 6.Upon ascertaining that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs had not responded to the summons issued by the investigating authorities. 9.The defence of the appellants before us is the same as before the adjudicating authority, that the goods are a stock lot and bought cheap from the Chinese supplier, that the investigation had not proved the link between their Chinese supplier and the goods shipped to Hong Kong from Taiwan. In addition, certain legal questions have also been raised, that the adjudication order was in error in holding that the price charged to the Hong Kong buyer could be the basis of assessment, there was no justification for adding 10% profit towards the profit margin of the Hong Kong dealer and that if the customs authorities wanted to reject the transaction value they should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e declared in the customs documents filed at Goa. These goods were never sent to the Chinese party who had issued the invoice produced before the customs. The invoice was to M/s. Asia Lucky Industrial Ltd. of which Shri Jawahar Lal Luthra was the power of attorney holder. The value and other particulars made available by M/s. Motorolla for the one variety of I.Cs manufactured by them also shows that the value declared to the customs was much lower than the actual value of the goods. Thus, misdeclaration of value and production of false invoice remains established. The evidence on record only makes it clear that the invoice of the Chinese firm is a fictitious document and did not represent the transaction. The transaction was actually betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the revision of value of the consignment as carried out by the custom authorities. 13.Coming to the fine and penalties imposed by the adjudicating authority, our finding on facts as recorded above, make it clear that this is a case of premeditated tax fraud to evade customs duty through the under-valuation of goods, fabrication and filing of false invoice in the name of a Chinese supplier to justify the under declared value. The tax evasion was elaborately planned with goods first shipped to a transit country. Hong Kong, where the goods were repacked to remove identification particulars. Further, while the purchase at Hong Kong and despatch to India were by Shri Jawahar Lal Luthra, invoice was prepared in the name of a mainland China firm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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