Customs, Excise and Gold Tribunal - Mumbai
Chandrakant H. Sanghvi vs Commissioner Of Customs on 19 September, 2000
Equivalent citations: 2000(121)ELT788(TRI-MUMBAI)
ORDER Gowri Shankar, Member (T)
1. We are concerned in these two appeals with two embroidery machines imported by the appellant in 1993. In the order impugned in these appeals, one by the importing firm and the other by the managing partner Chandrakant Sanghvi, the Collector of Customs has found that the value of the machines for assessment to duty should be, not Rs. 54.G0 lacs approx which was declared, but Rs. 77.00 lacs. He has found that the benefit of Notification 16/85 was not available to it. He has ordered the machines were imported in contravention of the import policy, ordered their confiscation with an option to redemption on payment of fine, imposed penalties on the firm as well as on its managing partner.
2. The value declared by the importer was accepted at the time of clearance. It is only subsequent investigation by the Directorate of Revenue Intelligence (DRI) that resulted in the charge of under valuation. The only evidence to support the charge of under valuation is a document, purporting to be a fax message from M/s Perfecta Schmid, the supplier of the machine. It does not bear the signature of P Rasson of that company, the space above his name in the bottom of the letter being blank. It also does not bear the address of the recipient. It is not otherwise authenticated by any means. Such a document, therefore does not legally constitute an acceptable evidence. It has also to be viewed with utmost caution, in the light of the fact that it was given to the department by an informer (as the Collector states). An informer is obviously a person very much interested in the outcome of the proceedings either for his reward or other factors which motivated his tendering information. There is therefore nothing to militate against the acceptance of the declared value.
3. The Table to Notification 16/85, as it stood at the relevant time, exempts the following kinds of embroidery machines :
"4.9. multi head embroidery machines. 50. scalloping embroidery machines. 51. trycot embroidery machines. 51. embroidery machines (general)."
The Collector finds that the machines imported were not of the first three variety and this is not disputed by the appellant. The Collector also finds that the goods were not embroidery machines (general). What the notification appears to do is to first exempt embroidery machine specialised for a particular use or of a particular type and then exempt all other machines. The word "general" occurring in entry 52 obviously refers to embroidery machines for general application, is distinct from the three specialised machines preceding this entry in the Table. There was therefore no justification for not extending the benefit of this notification.
4. The liability to confiscation of the machines on the ground that they were imported in contravention of the policy prohibiting import of these machines of seven years is not disputed. However, the appellant contends that it was misled by the supplier. We take into account the fact that the machines satisfy one of the conditions in the policy of having residual life of over five years, and that the appellant has in fact been using them. We also take note of the position in law that penalty could not be imposed on a partnership firm as well as on its partners. Further, the redemption fine and penalties determined by the Collector are on the basis of the enhanced value, which we have not accepted.
5. Accordingly, we reduce the redemption fine from Rs. 20.00 lacs to Rs. 8.00 lacs and set aside the penalty imposed on the firm. The penalty imposed on Chandrakant Sanghvi is confirmed.
6. Appeal C/1755/95 is dismissed and appeal C/1756/95 is allowed in part.