Customs, Excise and Gold Tribunal - Mumbai
Ramesh K. Agarwal, Ravi Shankar Films ... vs Commissioner Of Customs (Export), ... on 12 September, 2001
Equivalent citations: 2002(141)ELT282(TRI-MUMBAI)
JUDGMENT
Gowri Shankar, Member (Technical)
1. The appeal is against the order of the Commissioner confiscating under Clauses (d) and (i) of Section 113 of Act, the goods described by Ravi Shankar Films Pvt. Ltd 35mm perforated polyester positive film in roll films but found, on examination, to be slumps as it is, imposing penalty on the exporter and on Ramesh Agarwal, Vice President of the company, and Manohar Prasad, the director. The appeal by the Commissioner seeks to enhance the penalty imposed on Ravi Shankar Films Pvt Ltd.
2. Representative of the appellants does not deny that the goods were, on examination, found to be slumps as it is and not what they were declared to be. He contends that confiscation of the goods under Clauses (d) and (i) of Section 113 cannot be ordered for the reason that export of the goods were not prohibited, and they were not dutiable or exported under claim of draw back; that they were not dutiable or entitled for exportation under draw back, cannot be questioned. The provisions of Clause (i) of Section 113 will not come into play.
3. Clause (d) will apply to goods attempted to be exported or brought within the limits of Customs area for being exported contrary to any prohibition imposed by or under the Customs Act or any other law for the time being in force.
4. The Calcutta High Court in its judgment in CC v. Pankaj V Sheth 1997 (90) ELT 31 has held in paragraph 20 as follows:
20. Similarly,under the Foreign Trade (Regulation) Rules, 1993 which have been framed under the Foreign Trade (Development and Regulation) Act, 1992, Rule 2(i) provides that "value" would have the same meaning as was assigned to it in Section 2(41) of the Act. Thus the procedure for determination of value under Section 14 of the Act is brought in for the purposes of the 1993 Rules. Rule 11 of the 1993 Rules clearly states that the value of the goods must be stated whether the goods are liable or duty or not and such statement must be certified as being correct. If therefore an incorrect declaration is made this would be a violation of Rule 11 of the 1993 Rues. If an incorrect declaration of the value is made this would violate Section 11 of the 1992 Act which forbids the export or import of goods in violation of the Rules. This in turn would attract the provisions of Sections 111 and 113 of the Act as goods imported or exported contrary to law and give the Customs Authorities the power to investigate the correct value of the goods in question and for that purpose utilise the method prescribed under Section 14(1).
5. In the absence of any contrary judgment of the High Court, this judgment is binding upon us. It has therefore to be held the goods were liable to confiscation. There is no explanation offered as to why the exporter chose to misdeclare the goods that it exported. The benefit that the Commissioner points out that it would have received import benefits in proportion to the value which it declared, of Rs 2.44 crores actually having a value of Rs 22,321/- gives a clear answer.
6. This takes us to the department's appeal. In his order, the Commissioner has imposed a penalty of Rs 3.00 lakhs, accepting the submission of the exporter that it would not have got any import licence benefit, since the application for licence had been rejected by the licensing authority on grounds entirely unconnected with the fact of misdeclaration (i.e. there were no input norms). We do not find it possible to accept that the explanation provides the mitigating factor. The exporter failed to derive any benefits from its deliberate wrong declaration only because of some entirely unanticipated contingency which was outside his calculation and not act of any change in his attitude. This does not, in our view, reduce in the gravity of the offence of cross misdeclaration of value. We therefore accept the department's appeal for enhancement of penalty, set aside the Commissioner's order imposing penalty of Rs. 3.00 lakhs, and increase the penalty to Rs. 30.00 lakhs.
7. For the same reason, and in the absence of any evidence to show that Vice President and the Director did not know or participate in the illegal export, we do not find it possible to set aside or reduce the penalty imposed on them.
8. Appeals C/590, 591/95 and 1230/99 dismissed. Appeal C/432/96 allowed.