The Mumbai bench of Customs, Excise and Service Tax Appellate Tribunal held that Section 111(m) of Customs Act, 1994 could only be invoked only upon material particulars being declared and was a detriment in addition to the duty liability determined and dismissed the appeal by Shashi Dhawal Hydraulics Pvt Ltd (The Appellant) against Commissioner of Customs (Import) (The Respondent).
The appellant was notified of the recovery of ₹ 20,31,302 that was short-paid on the import of ‘David Brown hydraulic pumps’ from S&H Universal, UK, and its value was enhancement of assessable value from GBP 90 to GBP 212 apiece by adopting the value in imports affected the sister concern of the appellant, Shashi Charu Hydraulic Pvt Ltd. The impugned order also held the impugned goods liable for confiscation under section 111(m) of the Customs Act, 1962 while imposing a fine of ₹ 20,00,000 in lieu thereof besides invoking section 112 for the imposition of penalties.
The two-member bench consisting of Ajay Sharma (Judicial Member) and C.J. Mathew (Technical Member) after hearing both sides held that the issue for consideration was the acceptability of facts relating to the import and assessment under section 17 Customs Act, 1962 that, on their own, would merit restricting the demand, if any, under section 28 of Customs Act, 1962 to the normal period of limitation and, if not, the legality of distinguishing ‘suppression/misrepresentation’ and ‘misdeclaration’ for independent consequences.
The bench also stated that the impugned order has clearly elaborated on the transactions that a ‘sister concern’ had had with the manufacturer from whom the supplier of the appellant had sourced the impugned goods and that the variation in the transacted prices was within the knowledge of the authorized persons of the appellant-importer.
The bench further held that “We, therefore, find ourselves unable to accept the submission of the appellant that relief from confiscation amounts to relief from being subjected to the ‘extended period’ for recovery of duty under section 28 of Customs Act, 1962” and the appeal was dismissed.
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