Custom, Excise & Service Tax Tribunal
4. Whether Order Is To Be Circulated To ... vs Unknown on 10 April, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT AHMEDABAD
Appeal No. : C/107/06.
Arising out of : OIA NO.100/2006-AHD/CUS/COMMR(A)/AHD
Dated 27/11/2006.
Passed by: Commissioner of Central Excise & Customs (Appeals),
For approval and signature:
Mr.M.V. Ravindran, Honble Member (Judicial)
Mr. H. K. Thakur, Honble Member (Technical)
1. Whether Press Reporters may be allowed to see the No
Order for publication as per Rule 27 of the CESTAT
(Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the No
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of Seen
the order?
4. Whether order is to be circulated to the Departmental Yes
authorities?
Appellant : M/s.Sandhya Jewellers.
Respondent : CC, Ahmedbad.
Represented by:
for Appellant : Mr. P. P. Jadeja (Consultant) for Respondent : Mr. K. Shiv Kumar (A.R.) CORAM:
MR.M.V. RAVINDRAN, HONBLE MEMBER (JUDICIAL) MR. H. K. THAKUR, HONBLE MEMBER (TECHNICAL) Date of Hearing: 10/04/13.
ORDER No. /WZB/AHD/2012, dt._____________ Per: M.V. Ravindran:
1. This appeal is directed against Order in Appeal No. 100/2006-AHD/CUS/COMMR(A)/AHD dated 27/11/2006.
2. The facts in brief are that the appellant imported 1926 pieces of silver jewelry weighing 9.300 kilograms through Foreign Post Office. On examination of the post parcel and scrutiny of the documents submitted by the appellant and the proforma invoice withdrawn from the post parcel, the Customs officers found that the appellant had misdeclared the value of the imported goods. The value as per the proforma invoice was 7462.80 USD whereas the appellant had declared the value as 1926 USD and the goods were declared as jewellery made of silver and other metals. Shri Shivam A. Patel, authorized signatory of the appellant in his statement dated 27/05/2006 stated that the appellant had placed order for standard silver jewellery having low cost stones whereas the supplier had sent silver jewellery of American standard having high priced stone and that they had no intention to evade customs duty.
3. A show cause notice was issued to the appellant asking them as to why the imported silver jewellery should not be confiscated under Section 111(m) of the Customs Act, 1962 (hereinafter called the Act), customs duty of Rs.58,088/- should not be recovered under Section 28 of the Act and penalty should not be imposed on Sandhya A. Patel, Proprietor of M/s.Sandhya Jewellers under Section 112(a) of the Act.
4. After going through the submissions of the appellant, the Adjudicating Authority under his impugned Order-in-Original observed that the appellant had accepted the mis-declaration and volunteered to pay the duty on the higher value. He observed that the reason of communication gap with the supplier pleaded by the appellant is only an after thought. He, therefore, held that the goods were liable to confiscation under Section 111(m) of the Act and the appellant was liable to penalty under Section 112(a) of the Act.
5. The adjudicating authority ordered for the confiscation of goods and imposed fine of Rs.80,000/- (eighty thousand) and he also demanded customs duty and imposed penalty of Rs.20,000/- (twenty thousand) under Section 112(a) of the Customs Act, 1962.
6. Aggrieved by such an order, the appellant preferred an appeal before the First Appellate Authority. The First Appellate Authority after following due process of law, rejected the appeal and upheld the order in original, but reduced the quantum of redemption fine to Rs.30,000/- and the quantum of penalty was reduced to Rs.15,000/-.
7. The ld. Counsel appearing on behalf of the appellant would submit that Section 82 of the Customs Act, 1962, governs the goods which make entry through post parcel. It is also his submission that the appellant had, in fact, filed a declaration which is not required under Section 82 of the Customs Act, 1962, which categorically provides for accepting declaration on any label accompanying goods deemed for import or export and it is on record that the value was correctly recorded on the said documents. It is his submission that the appellant had no reason to declare lower value as it is undisputed that they had imported the jewellery and the exporter had filed invoice along with the consignment. He would submit that in any case, confiscation of goods under Section 111(m) of the Customs Act, 1962, for the goods imported through post parcel, is incorrect in law as settled by the Tribunal in the case of Commissioner of Customs vs. M. Vasi [2003 (151) ELT 312 (Tri.-Mumbai)] and judgment in the case of Kuresh Laila vs. Commissioner of Customs, Chennai [2005 (189) ELT 45 (Tri.-Chennai)] and P. Kumar vs. Commissioner of Customs, Mumbai [2009 (240) ELT 108 (Tri.-Mumbai)]
8. The ld. Departmental representative on the other hand reiterated the findings of the lower authorities.
9. After considering the submissions made by both sides and perusal of record, we find that it is undisputed that the appellant had imported jewellery through post parcel. It is also undisputed that the said post parcel had invoice which indicate the value as US$ 7462.80. The appellant herein had filed declaration under Rule 10 of the Customs Rules, 1988, indicating the value of the consignment.
10. When there is no dispute that the appellant had imported the jewellery consignment by post parcel we find strong force in the contentions raised by ld. Counsel reading Section 2(16) of the Customs Act, 1962, entry in relation to goods is defined as:
(16) entry in relation to goods means an entry made in a bill of entry, shipping bill or bill of export and includes in the case of goods imported or to be exported by post, the entry referred to in Section 82 or the entry made under the regulations made under section 84;
11. It can be seen from the above that in respect of goods which are imported or exported by post are in accordance with the mandate given in Section 82 of the Customs Act, 1962, which is reproduced below:
Section-82: Label or declaration accompanying goods to be treated as entry :- In the case of goods imported or exported by post, any label or declaration accompanying the goods, which contains the description, quantity and value thereof, shall be deemed to be an entry for import or export, as the case may be, for the purposes of this Act.
12. It can be seen from the holistic reading of both the sections in case of goods imported by post parcel, declaration accompanying goods shall be deemed to be a declaration for discharge of customs duty. It is undisputed that there was an invoice accompanying the post parcel which indicate the value of US$ 7496.80. The authorities have also considered the said value as correct value as per Section 84 of the Customs Act.
13. We find that the ld. Counsel was correct in bringing to our notice that confiscation of goods under Section 111(m) of the Customs Act, 1962 will not apply to post parcel. We find that in the case of M. Vasi (supra) it was held as under:
10. When the goods are imported by Land, Sea or Air a Bill of Entry is filed for their clearance in terms of Section 46 of the Customs Act, 1962 where the responsibility of making a truthful declaration is upon the declarant and where any contravention or lapse can render the goods liable for confiscation and the declarant liable to penalty. In the case of baggage, as per Section 77 of the Customs Act the declaration is made by the passenger orally. Section 82 which deals with post parcel is entirely different in construction and in coverage. It does not require the importer to make a declaration. The declaration made by the exporter abroad is deemed to be an entry for the goods. This is a very important difference. Even if an entry is found to be wrong the responsibility of wrong declaration cannot be fastened upon the importer. It would appear that Section 111 of the Act takes cognizance of this situation. Clauses (l) and (m) section 111 read as below:
any dutiable or prohibited goods (l) which are not included or are in excess of those included in the entry made under this Act or in the case of baggage in the declaration made under Section 77.
any goods which do not correspond (m) in respect of value or in any other particular with the entry made under this Act or in the case of baggage with the declaration made under Section 77 in respect thereof or in the case of goods under transshipment, with the declaration for transshipment referred to in the proviso to sub-Section (1) of Section 54.
11. The phrase entry made under this Act comes from Section 46. In terms of Section 82 reads as below no entry is made by the importer. That is why where as special mention is made of Section 77, there was no mention of Section 82 in the two clauses of Section 111.
Section 82. Label or declaration accompanying goods to be treated as entry:- :- In the case of goods imported or exported by post, any label or declaration accompanying the goods, which contains the description, quantity and value thereof, shall be deemed to be an entry for import or export, as the case may be, for the purposes of this Act.
12. Apart from this position in law, we have examined the declaration pasted to the parcel. There is no significant difference in the declaration between watch movements and watch modules. The value has been declared as per invoice. The fact that the value is contested and is to be redetermined does not make the original declaration as a deliberately wrong declaration. On these grounds the Commissioner was correct in not adjudging the goods liable to confiscation under these two provisions.
14. The above said order has been followed by this Tribunal in the case of P. Kumar,(supra) wherein one of us was a member, and held as under:
13.?We find that the Tribunal in the case of M. Vasi (supra) was considering an appeal filed by the Revenue in respect of the very same issue i.e. the goods that landed in India by a post parcel whether can be confiscated under the provisions of Section 111 of the Customs Act or not. The Bench after considering the law, held as under :-
10.?When the goods are imported by Land, Sea or Air a Bill of Entry is filed for their clearance in terms of Section 46 of the Customs Act 1962 where the responsibility of making a truthful declaration is upon the declarant and where any contravention or lapse can render the goods liable for confiscation and the declarant liable to penalty. In the case of baggage, as per Section 77 of the Customs Act the declaration is made by the passenger orally. Section 82 which deals with post parcels is entirely different in construction and in coverage. It does not require the importer to make a declaration. The declaration made by the exporter abroad is deemed to be an entry for the goods. This is a very important difference. Even if an entry is found to be wrong the responsibility of wrong declaration cannot be fastened upon the importer. It would appear that Section 111 of the Act takes cognizance of this situation. Clauses (l) and (m) Section 111 read as below :
(l) any dutiable or prohibited goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under Section 77.
(m) any goods which do not correspond (m) in respect of value or in any other particular with the entry made under this Act or in the case of baggage with the declaration made under Section 77 in respect thereof or in the case of goods under transhipment, with the declaration for transhipment referred to in the proviso to sub-Section (1) of Section 54.
11.?The phrase entry made under this Act comes from Section 46. In terms of Section 82 which reads as below no entry is made by the importer. That is why where as special mention is made of Section 77, there was no mention of Section 82 in the two clauses of Section 111.
Section 82. Label or declaration accompanying goods to be treated as entry - In the case of goods imported or exported by post, any label or declaration accompanying the goods, which contains the description, quantity and value thereof, shall be deemed to be an entry for import or export, as the case may be for the purposes of this Act. It can be noticed from the above reproduced portion of the Tribunals judgment that an identical issue was before the co-ordinate bench. The view taken by the Bench is that even if an entry is found to be wrong, the responsibility of wrong declaration cannot be fastened upon the importer. It can be also noticed that the decision of the Tribunal in the case of M. Vasi (supra) that the adjudicating authority in that case has dropped the proceedings on the very same ground that the provisions of Section 111 of the Customs Act, 1962 are not applicable to the goods, which arrived through post parcel. The appeal was filed by the Revenue. We find no hesitation in coming to the conclusion that the above reproduced ratio will squarely cover the issue before us and goods arrived by post parcel will not liable for confiscation under Section 111(l) and 111(m) of the Customs Act, 1962. Since the impugned goods are not liable for confiscation, the consequent penalty imposed under Section 112(a) on the appellant Shri P. Kumar is also unwarranted. Accordingly, the impugned order to the extent it imposed penalty on the appellant Shri P. Kumar is liable to be set aside and we do so.
15. In view of the foregoing and judicial precedents and in the facts and circumstances of this case, we find that the impugned order is unsustainable and we have no hesitation in holding it so. The impugned order is set aside with consequential relief if any.
(Pronounced in Court on ______________________)
(H. K. Thakur) (M.V. Ravindran)
Member (Technical) Member (Judicial)
Jn/-
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