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OIPL made a complete disclosure in the submissions filed before the Assistant Commissioner of Customs (Group-5B), New Customs House, New Delhi (SVB authority) vide their letter dated 19.01.2007. Information relating to remittance of 56% of license fees to Oracle Corp., US was duly submitted in response to the SVB Questionnaire wherein OIPL has stated in unambiguous words that it remits licence fee to Oracle Corp., USA. OIPL also submitted a copy of the SDDA (in terms of which royalty is to be remitted) along with the SVB submissions. This shows that the allegation regarding non-disclosure of information pertaining to royalty remittance is totally misconceived and factually incorrect. Therefore, extended period of limitation under proviso to Section 28 of the Customs Act cannot be invoked in the present case.

(xxiii) OIPL, knowingly suppressed the information relating to the actual valuation of the goods by never disclosing to the department (Customs) the information regarding remittance of 56% of the licensee fee to M/s. Oracle USA in accordance with the Master Services Agreement. This fact was neither disclosed by OIPL to the department at the time when OIPL requested for provisional release of the seized goods under PD Bond / BG nor in OIPLs reply to the SVB questionnaire. This fact of non declaration of License Fee amount remitted by OIPL to OIC emerged only through the investigations conducted. Therefore, the proviso to Section 28 of the Customs Act, 1962 is squarely applicable in the present case to demand the CVD from OIPL invoking the extended period of limitation while also demanding the interest thereon under Section 28AB of the Customs Act, 1962.

7. OIPL had all along disclosed the fact of imports being made from related persons and even in 2005 it had made detailed information to SVB in the context of import of VPN hardware. As regards non-disclosure of licence fee, it was clearly disclosed in reply to the SVB questionnaire submitted on 19.01.2007.

Analysis of Evidence/Arguments/Contentions/Pleadings

8. We have considered the evidence on record and contentions/arguments/pleadings of both sides. The issues involved in this case which are required to be adjudicated upon are summarised as under:-

18. The allegation of wilful mis-statement/ suppression of facts needs careful analysis as it is a mixed question of facts and law. Every misstatement need not necessarily be wilful and to evade customs duty and every not telling does not necessarily mean suppression. It is relevant to note that the total demand confirmed vide the impugned order is approximately Rs.128 crores out of which we have in effect held that only demand of the order of about Rs.19 crores is sustainable on merit. Further, the very fact that OIPL had made complete disclosure regarding its commitment to remit 56% of licence fee to Oracle USA in its FIPB application is certainly indicative of the fact that it did not have any intention to hide this fact. We are aware that disclosure before FIPB authorities would not amount to disclosure before the customs authorities but it does lend credence to the appellants contention that having obtained FIPB approval after declaring the fact regarding OIPLs commitment to remit 56% of licence fee or Oracle USA, it would not have attempted to hide this fact from Customs. In fact, in January, 2007, OIPL disclosed this fact during SVB investigations (in its reply to SVB questionnaire). The seizure took place in January, 2008 when customs could hardly claim that OIPL had not disclosed the facts about its relationship with Oracle Ireland or about the remittance of licence fee to Oracle USA when these facts were made known to Customs SVB in January, 2007 in response to its (SVBs) questionnaire. Even earlier on 22.09.2005, OIPL wrote to Dy. Commissioner of Customs, Gr. VB, New Custom House, New Delhi in response to his letter No.VIII(12)/I&G/ 07/GRVC/CH-85/03/PD/05, dated 12.04.2005 in connection with the import of VPN hardware from Oracle Ireland that both are related as group companies and in both of them Oracle USA was a majority shareholder. Indeed it would be incredibly naive on the part of the well known company like Oracle to believe that OIPL could successfully hide its relationship with Oracle Ireland by not declaring the relationship in the Bills of Entry when their respective names were so demonstrative of they being related. On the other hand, in the given circumstances, it sounds incredible that a professional organisation like Indian Customs should claim that it did not / could not realise that the imports by OIPL from Oracle Ireland were from a related person. Further, the fact that the appellant had followed the same system, procedure and practice of declaring assessable value even during the period prior to 01.03.2006 when there was no duty to be evaded at all, goes a long way in support of the contention of the appellants that there was no intention on their part to wilfully mis-state or suppress any facts. In any case, there is evidence on record that in September, 2005 and January, 2007 they submitted the details about OIPLs relationship with Oracle Ireland and Oracle USA to Customs and so the allegation that OIPL suppressed the fact of it being related to Oracle Ireland stands pretty much negated by this evidence alone. It is also more than evident from the analysis above that the issue is purely and undoubtedly interpretational. Thus, the claimed bona fide belief on the part of the appellants that the licence fee remitted to Oracle USA was not includible in the assessable value cannot be called unreasonable or hallucinatory. The Supreme Court in the case of Continental Foundation Joint Venture Vs. CC, Chandigarh [2007 (216) ELT 177 (SC)] observed that any incorrect statement cannot be equated with wilful misstatement. In case of Nestle India Pvt. Ltd. Vs. CCE [2009-TIOL-26-SC-CX], Supreme Court observed that there must be conscious or deliberate withholding of information to invoke longer period of limitation. That when the issue involved is interpretational, no penalty is imposable has been held in a series of judicial pronouncements like Delphi Automotive Systems Vs. CCE,NOIDA [2004 (163) ELT 47 (Tri.  Del)] and Prem Fabricators Vs. CCE, Ahmedabad [2010 (250) ELT 260 (Tri.  Ahd)]. Supreme Court in the case of Tolaram Relumal Vs. State of Bombay [AIR 1954 SC 496] way back in 1954 observed that it is a well settled rule that when two reasonable constructions can be put upon the penal provision, court must lean towards that construction which exempts subject from penalty rather than one which imposes penalty. When no penalty is held to be imposable when the issue involved is interpretational, it almost axiomatically follows that even extended period cannot be invoked in such cases. Indeed we do not find even marginal support/ evidence to sustain the charge of wilful mis-statement / suppression of facts and therefore we hold that the allegation of wilful mis-statement/suppression of facts is not sustainable and penalties relating thereto are not imposable. As a result, the demand even in relation to commercial physical imports of media packs (except those which were seized) is hit by time bar.