The Delhi bench of the Customs, Excise & Service Tax Appellate Tribunal(CESTAT) has held that mere acceptance of reassessed value and payment will not sufficient to confirm the allegation of undervaluation of imported brass ceramic cartridge and set aside Penalty under Customs Act, 1961.
M/s River Side Impex, the appellant filed a Bill of Entry through their Customs House Agent (CHA) M/s Prompt Air and Sea Cargo Pvt. Ltd. for clearance of the imported goods called Brass Ceramic Cartridge (L) size ½” Parts for use in Sanitary ware. However, the goods covered under the said Bill of Entry were examined and the container was also weighed.
The net weight was found as 21120 kg., however, the weight as per the packaging list was 20160 kg. whereas the weight declared in the Bill of Entry was 18144 kg. Thus 2976 kg. weight of the consignment was found more than the declared weight. Accordingly, goods were seized under section 110 of the Customs Act, 1962.
The invoice was also observed to have no mention of the metal contents of the brass tap cartridge. the report of a market survey that the declared assessable value of Rs. 28,08,128/- in the Bill of Entry was rejected in terms of Rule 12 of Customs Valuation (Determination of Value of Imported Goods) Rules and the value was reassessed at Rs. 55,83,280/- with the total reassessed duty of Rs. 14,75,563/-. The already paid duty of Rs. 7,42,139/- was acknowledged to have been paid.
The goods were confiscated with an option of getting those released on payment of a redemption fine of Rs. 75,000/- and the penalty of Rs. 7,33,243/- was imposed upon the appellant. On appeal, the findings have been confirmed by upholding the order.
Shri L.B. Yadav, Consultant for the appellant and Shri Rakesh Kumar, departmental representative for the Revenue.
The appellant has mentioned that the demand has wrongly been confirmed. There is neither the mis-declaration nor the under-valuation in the impugned Bills of Entry. The allegations are vehemently denied with mention that the brass ceramic cartridges have been imported into pieces and the value is per piece based value. The weight has no consequence nor any connection with the value. Otherwise, the container as such including the packaging materials was weighed. Hence, the same has wrongly been held to be a case of mis-declaration.
A two-member bench of Dr Ms Rachna Gupta, Member (Judicial) and Ms Hemambika R Priya, Member (Technical) viewed that in the original submissions made on behalf of the appellant, it is mentioned that to avoid any delay and the demurrage charges, in case the consignment is held by the Customs Authority, that the appellant opted to pay the differential amount demanded by them. The voluntary payment hence cannot be called an admission of the appellant towards the alleged mis-declaration of value from the above discussion.
“Since it is apparent that the Department has not followed the statutory procedure nor there was any misdeclaration of quantity as alleged, the mere acceptance of the reassessed value and payment thereof will not be sufficient to confirm the allegations of undervaluation. The burden was still on the Department to prove the allegations levelled. The said burden has not been discharged. “, the CESTAT held.
The Tribunal set aside the order under challenge and allowed the appeal.
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