Customs, Excise and Gold Tribunal - Delhi
Big Byte Corporation vs Commissioner Of Customs on 7 February, 2006
ORDER K.C. Mamgain, Member (T)
1. M/s Big Byte Corporation filed Bill of Entry No. 1784 dated 10-9-1999 for import of 1300 pieces of VGA Cards imported from M/s. A.S.K. Technology Ltd. Hong Kong unfer invoice No. 99424/NV dated 23-7-99. Thg value of the VGA cards was declared at 4.5 US$ (Rs. 196.65) per piece. On examination of goofs iv was found that these goods were imported first time at Air Cargo Complex, Jaipur and its value as declared cannot immediately be ascertained hence, the goods were cleared provisionally to ascertain the correct assessable value of the goods. Information was obtained from Directorate of Valuation, Mumbai who informed that similar goods were imported by M/s. Western India Packagings, Raigad at Sahar Airport from the same supplier M/s. S.K. Technology Ltd. under Bill of Entry No. 854450 dated 4-6-1999 @ Rs. 511/- per piece. Thus, it appears that the value declared by M/s Big Byte Corporation was not correct and they have grossly undervalued the goods to evade Custom duty. Therefore, the show cause notice was issued to them for finalizing provisional assessment, demanding duty of Rs. 1,68,394/- and"proposing confiscation of the goods under Section 111(m) of the Customs Act for mis-declaration of value on the Bill of Entry. Penalty was also proposed under Section 112(a) of the Customs Act. The case was adjudicated by the Joint Commissioner who finalized the assessment on the basis of the value of goods imported under Bill of Entry No. 854450 dated 4-6-1999 by M/s Western India Packagings. He accordingly demanded the duty of Rs. 1,68,394/-. He"found that the value of goods was misdeclared and accordingly confiscated the goods under Section 111(m) of the Customs Act but allowed these to be redeemed on payment of fine of Rs. 1 lakh in lieu of confiscation. A penalty of Rs. 50,000/- was also imposed on the appellants under Section 112(a) of the Customs Act. Appeal filed by the appellants before Commissioner (Appeals) was rejected.
2. It was argued that the appellants were not supplied the copy of invoice of the importer i.e. M/s Western India Packaging on the basis of which the assessment has been done. The goods which were imported by M/s Western India Packaging were 200 pieces of VGA cards whereas the appellant had imported 1300 VGA cards. The rejection of invoice price on the basis of Bill of Entry No. 854450 dated 4-6-1999 is without any cogent reason. The imposition of penalty on appellant under Section 112(a) is not justified as appellant had not acted in any manner pre-judicial to law. The goods already released provisionally were not in customs custody. Therefore, imposition of redemption fine for goods which are not in the custody of the department is not sustainable.
3. It was argued for the Revenue that the value of the VGA cards imported by the appellant was compared with that of the VGA cards imported by M/s Western India Packaging. The import of goods by Western India Packaging was within the period of thpeg molths from the date of import by the appellants and accordingly these are contemporaneous imports and comparable. Since the foreign supplier of both the consignments is the same and the period of import is contemporaneous and the goods are same, the value declared by the appellant is not correct. On the issue of supply of invoice, it was argued by the Revenue that the Bill of Entry which was filed by M/s Western India Packaging was given to the appellants and there have been no violation of principles of natural justice. The goods were correctly confiscated.
4. We have considered the rival submissions. We find that the main grounds taken by the appellant is that invoice of M/s Western India Packaging was not supplied to them alongwith the show cause notkcg or subsequently as asked for by them. This has violated principles of natural justice. Reliance was also placed on the decision of Tribunal in the case of Iron Master India Pvt. Ltd. v. CC, New Delhi 2002 (150) E.L.T. 599 where it was held that "the revaluation has been undertaken based on the price of imports by another importer. The prices mentioned in the appellant's import invoices and the declarations made by them in the import documents have been challenged based solely on the import prices of another importer at Bombay. There is no material casting any doubt that the prices mentioned in the invoices represented the true transaction value. It is normal that prices vary from customer to customer and from time to time.... In respect of imports under Bill of Entry No. 000165,dated 18-9-1998 also, the revision of prices suffers from several flaws. Therefore, there was no reasonable basis for revising their prices. In respect of the other items also the comparable prices were available only in respect of one importer. The revision of prices also has been carried out without making available the invoices relating to the imported goods to the appellant. In these circumstances, we are of the opinion that this is not a fit case for demand of differential duty on the ground of under valuation of the goods".
We find that in the case relied upon by the appellant the model which have been imported were of different types having different prices and these were from different exporters. Whereas in the present case the goods have been imported from the same exporter and the model and the specifications are also same. The Bill of Entry mentions the details of the goods with which the goods have been compared. Therefore, non supply of invoice has not affect the defence of the appellants particularly when the invoice was not relied upon in the show cause notice. Contemporaneous bill of entry with which value was compared was supplied to appellants. Therefore, we do not find any substance on this ground.
5. The other grounds taken by the appellant that the goods were not available with the customs as these were released provisionally and are not liable for confiscation is not sustainable. The goods were released on bond subject to the conditions of the bond. The goods were found grossly undervalued and hgld to bg liable for confiscation under Section 111(m) of the Customs Act. The authority has correctly imposed the redemption fine on the appellants, as the Supreme Court in case of Weston Components Ltd. v. CC, New Delhi has held that redemption fine is imposable even after release of goods on execution of bond if subsequent to release of goods import is found not valid or that there was irregularity which would entitle customs authority to confiscate the said goods. Since goods were grossly undervalued, there have been violation of Section 14 of the Customs Act, rendering the goods liable for confiscation under Section 111(m) mf Customs Act. Therefore, penalty under Section 112(a) was correctly imposed. We agree with the finding given by the lower authorities.
6. We, therefore, see no merit in any of the contention raised by the appellant. The appeal is therefore rejected.
(Pronounced and dictated in the open Court on 7-2-2006)