Customs, Excise and Gold Tribunal - Mumbai
Jogani Tyres (India) vs Commissioner Of Customs (Prev.) on 29 October, 2002
Equivalent citations: 2003(161)ELT196(TRI-MUMBAI)
ORDER Gowri Shankar, Member (T)
1. The applications are for waiver of deposit of duty of Rs. 18,46,892/-; and penalties as follows :
2. Jogani Tyres (India) Rs. 2.52 lakhs approx.
Lalit B. Jogani Rs. 10 lakhs Shailesh B. Jogani Rs. 5 lakhs
3. The duty has been demanded, and penalties imposed, on the finding of the Commissioner that four consignments of automobiles parts imported by Jogani Tyres between 1995 and 1996 were undervalued. The value is based on unit price of US $ 25 per tyre. The goods are stated to have been supplied to the applicant by Interocean Mercantile Company in Singapore and were shipped from Antwerp in Germany, Rotterdam, and Hamburg in Germany. The department's subsequent investigation led to its being supplied by the German Customs rules. Copies of two invoices purported to have been issued by Michelin Tyres, Karlsruhe (Germany) admittedly manufacturer of the imported tyres. These copies bear the address of Michelin Asia (HK) Ltd., and show the ultimate consignee to be Jogani Tyres. Each of the invoices for 558 tyres with a unit price of US $ 79.78. It is this document and the statements of Lalit Jogani recorded on 21-10-1999, 22-10-1999 and 23-10-1999 that forms the basis for the Commissioner's conclusion.
4. The common counsel for the applicant contends that the so called invoices are not signed by anyone and therefore do not assume any particular significance, despite being attested by any officers of the German Customs. The initial statement of Lalit Jogani was exculpatory as was the statement of other partners. The admissions of undervaluation contained in his statements were obtained as a result of assault on his father. He had, as soon as possible, filed a retraction on 23-10-1999. He further contends that the extended period of limitation would not apply, nothing has been concealed from the department, and the correct invoice has been produced. He disputes the application by the Commissioner of Rule 10A of the Customs Valuation Rules, which was not invoked in the notice. He further contends that the last consignments for which a Bill of Entry was filed on 5-9-1996 and duty-paid on 1-11-1996 was subjected to enhancement of value, based on contemporary invoice, and therefore its value cannot enhance once again. He questions the correctness of the penalties imposed under the provisions of Section 114A on the firm and the demand for interest under Section 28AB on the ground that the alleged contravention took place prior to 28-9-1996 when these provisions came in the statute. He points out that the Commissioner in his de novo adjudication necessitated by the Tribunal's order, has vastly increased the penalties on the partners and had imposed a penalty under Section 114A of the Act for the first time. He says that a sum of Rs. 10 lakhs has already been deposited.
5. The departmental representative contends that there is no satisfactory explanation offered by the applicant at any time for the presence of the name in the copy of the invoice that has been issued by the Michelin, Karlsruhe. He contends that documents have come from the official Government agency of Germany and it is absurd to allege that it has been fabricated, apart from anything, there is no motive for the German Customs to fabricate the document against an importer in India. The contention that Lalit Jogani's admission was obtained by force has not been substantiated. In any event, his retraction does not have any effect of nullifying the admission made by him in the statements. He seeks to justify the applicability of Sections 114A and 28AB of the Act on the ground that the duty in respect of the last consignment to which alone they apply was paid after 28 September, 1999. He further says that earlier order of the Commissioner having been set aside on the ground that the applicants were not heard, he was justified in imposing a penalty that he felt. In the light of the fact that the invoice, which was submitted, was wrong invoice, invocation of the extended period is justified.
6. On the face of it, we find significant failures in investigation. If as the department contends, the goods were in fact supplied directly by or on behalf of Michelin of Germany to the applicant, it would have been a simple matter to verify from that company, details of payment that were received by it from or on behalf of Jogani Tyres. However, even taking note of this failure, there are significant factors that prima facie goes against the applicants. The invoice issued by Michelin Tyres and supplied by the German Customs does bear the name of Jogani Tyres as the ultimate consignee. The quantity in each of the invoice, 558 tyres, and the type tally with the two Bills of Entry that the applicant filed. The dates of these invoices are 29-2-1996 and 15-7-1996 which also corresponds to the dates on which the Bills of Entry were filed in April and August, 1996. The admission made by Lalit Jogani cannot at this stage be totally disregarded. There is not even an attempt to explain the name of Jogani Tyres in the invoices. It is not seriously disputed that the copies of invoices were attested and supplied by German Customs.
7. We, therefore, direct deposit of the remaining duty by Jogani Tyres. The interest is not quantified and its deposit does not arise. It is in any case debatable whether the provisions of Sections 28AB and 114A will apply in respect of goods which were imported prior to the date of enactment of these sections. We further note that the Commissioner has substantially increased penalties in his second order. This is not permissible in law. Accordingly, we waive deposit of the penalties imposed on the applicants and stay their recovery.
8. Compliance on 31-10-2002.