Custom, Excise & Service Tax Tribunal
Cce, Delhi-Iii vs M/S Polyglass Acrylic Mfg. Co. Pvt. Ltd on 27 October, 2009
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No.2, R. K. Puram, New Delhi COURT-III Date of hearing/decision: 27.10.2009 Custom Appeal No. 160 of 2007-Cust. Br. [Arising out of order-in-Appeal No. 17-18/NS/GGN/07 dated 18.1.2007 passed by the Commissioner of Central Excise (Appeals), Delhi-III, Gurgaon] For approval and signature: Honble Shri M. Veeraiyan, Technical Member Honble Shri D.N. Panda, Judicial Member 1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982. 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3 Whether Their Lordships wish to see the fair copy of the Order? 4 Whether Order is to be circulated to the Departmental authorities? CCE, Delhi-III Appellant Vs. M/s Polyglass Acrylic Mfg. Co. Pvt. Ltd. Respondent
Appearance:
Appeared for the Appellant Shri Sunil Kumar, DR Appeared for the Respondent- Shri Prem Ranjan, Advocate Coram: Honble Shri M. Veeraiyan, Technical Member Honble Shri D.N. Panda, Judicial Member Order No.___________________________ Per: M. Veeraiyan:
This is an Appeal by the Department against the order of the Commissioner (Appeals) No. Appl/CE/CUS/GGN/15&16/06 dated 18.1.07
2. Heard both sides.
3. The relevant facts of the case, in brief, are that the Respondent imported two consignments and filed Bills of Entry declaring the goods as acrylic strips. They also sought for examination of the consignment on first check basis to avoid any discrepancies in values/weight/description of goods. The goods were subject to cent percent examination in the presence of CHA and the discrepancies noticed were as follows :-
Bill of Entry No. 540 dt. 21.7.03 S.No. Description declared Description found Net weight declared (in MT) Net weight found (in MT) 1 Acrylic Strips Acrylic off cuts (width up to 3) of different thickness & size 16.1003 14.416
2. Acrylic Strips (of different thickness & size) 3.604 Total 16.1003 18.02 Bill of Entry No. 736 dated 1.9.03 S.No. Description declared Description found Net weight declared (in MT) Net weight found (in MT)
1. Acrylic Strips Acrylic sheet (size 5 x 6.8) (secondary) 13.0072 8.858
2. Acrylic offcut (width upto 3) 13.0072 6.222 Total 13.0072 15.080 Pending investigation, the goods were provisionally released adopting the declared value of US$ 140 PMT in respect of acrylic strips, US$ 400 in respect of offcuts and US$ 780 in respect of sheets and after taking bank guarantee for differential duty.
4. The Original Authority held that there was mis-declaration and finalised the value of $140/PMT for acrylic strips; further enhanced the value to US$ 450 from US$ 400 in respect of offcuts and further enhanced the value from US$ 780 to 930 in respect of sheets. He also ordered confiscation of the goods and allowed redemption on payment of fine of Rs.2.00 lakhs. He also imposed penalty of Rs.1.00 lakh on the importer. On Appeal by the party, Commissioner (Appeals) accepted the transaction value i.e. 140 US$ in respect of acrylic strips and such value declared for offcuts and sheets also. However, he held that the charge of mis-declaration as established and reduced the redemption fine from Rs. 2.00 lakhs to Rs.20,000/- and penalty from Rs.1.00 lakhs to Rs.10,000/- .
5. Ld. DR submits that the examination on first check basis has clearly brought out the presence of sheets and offcuts in huge quantity and thus establishing mis-declaration of the goods. Commissioner (Appeals) has also upheld the mis-declaration. Therefore, adopting the declared value of 140 US$ which is applicable to strips for offcuts and sheets also are not justified. He seeks restoration of the order of Original Authority.
6. Ld. Advocate for the Respondent submits that they have ordered for strips; the distinction between strips and sheets are not significant; the value declared is the transaction value. However, they have accepted to pay duty at the time of provisional release at the value of 140 US$ for the strips 400 US$ for offcuts and 780 US$ for sheets. Further, enhancement at the time of finalisation was not justified as the enhancement was based on enhanced value of compared goods and the compared goods have come from different countries. He seeks upholding the order of the Commissioner (Appeals). He also submits that the redemption fine and penalty sustained by Commissioner (Appeals) was only in respect of discrepancy in weight of the consignment.
7. We have carefully considered the submission from both sides. In fact after hearing for some time on 26.10.09, we adjourned the matter today to produce documents like Bill of Entry, invoices and connected documents. We have perused the documents produced. We find that the Respondent themselves have asked for cent percent examination on first check basis. The examination report appended in the order in original clearly brings out that what was declared by the Respondent was acrylic strips and they were found to be of higher dimensions, some of them answering to the description as offcuts and some answering to the description of sheets. There is, thus, clear mis-declaration. The submission that they ordered only for acrylic strips and what was supplied by them was only acrylic strips cannot be accepted. The sheets of dimension 5X6.8 has been found to be more than about 8.8 MT in a total weight of 13 MT declared by them. The variation in weight could also be due to the receipt of sheets in the guise of strips. In common parlance, sheets which are of higher dimensions are meant for different uses. The Respondents submission that they as a manufacturer imported them and the goods are meant for melting is not relevant. The goods imported are required to be assessed in the condition in which they have been imported. The Respondent have not questioned the examination report, which has been done at their instance. Having held that what was imported by the Respondent is different from what was declared by them, the question of accepting the declared value for entire consignment is incorrect. However, the submission of the ld. Advocate that enhancement of the value of the consignment cannot be based on enhanced value of contemporaneous import is valid and deserves to be accepted. It is not in dispute that the transaction value in respect of sheets, which was compared, was only 780 US$, which was enhanced to 930 by the department. Therefore, the order of the Commissioner (Appeals) is only partly erroneous. We set aside the order of the Commissioner (Appeals). While restoring the order of the Original Authority, we modify the said order by holding that the value of sheets should be adopted as 780 US$ PMT as against 930 US$ adopted by Original Authority and the demand should be reworked accordingly. The duty of demand adopting the value in respect of offcuts @ 450 US$ is restored. The demand attributable to excess quantity is not in dispute before us. Taking entire facts and circumstances of the case into account, while restoring the order of Original Authority, with the above modifications, the redemption fine is fixed at Rs.1.00 lakhs (Rupees One lakh) and the penalty is fixed at Rs.50,000/- (Rupees Fifty Thousand)
9. The Appeal is disposed of in the above terms.
(Dictated & pronounced in open Court) (M.VEERAIYAN) TECHNICAL MEMBER (D.N. PANDA) JUDICIAL MEMBER RM