M/S. Sheth Developers Pvt.Ltd vs Commissioner Of Customs(Import)

[Arising out of Order-in- Original No. 80/2004/CAC/CC(I)/A.H. dtd. 31/8/2004 passed by the Commissioner of Customs (Import), New Custom House, Mumbai-I]

For approval and signature:

Honble Mr. P.S. Pruthi, Member (Technical) Honble Mr. Ramesh Nair, Member (Judicial)

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1. Whether Press Reporters may be allowed to see : No 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 : seen of the Order?

4. Whether Order is to be circulated to the Departmental: Yes authorities? =======================================================

M/s. Sheth Developers Pvt.Ltd. : Appellants

VS

Commissioner of Customs(Import), Mumbai-I : Respondent

Appearance

Shri N.D. George, Advocate for the Appellants Shri M.K. Mall, Asstt. Commissioner (A.R.) for the Respondent

CORAM:

Honble Mr. P.S. Pruthi, Member (Technical) Honble Mr. Ramesh Nair, Member (Judicial)

Date of hearing: 6/8/2015 Date of decision: 6/8/2015

ORDER NO.

Per : P.S. Pruthi

The appellant imported goods vide Bill of Entry No. 367615 dated 25/6/2003 declaring them as Ceramic Floor Tiles. In terms of Notification No. 73/2003-Cus dated 1/5/2003 vitrified tiles attracted anti-dumping at US$ 8.28 per sq. mtr. On testing by Dy. Chief Chemist, the goods were found to be vitrified tiles. Thereafter the premises of the appellant were searched on 24/9/2003. Shri Vallabh N. Seth, Director of the importers firm in his statement recorded on 24/9/2003 under Section 108 of the Customs Act, 1962, admitted that he knew about import of items declaring them as Ceramic Tiles. He agrees to pay differential duty. Accordingly, he paid Rs. 51,59,542/- on 25/9/2003 towards anti dumping duty. In the subsequent statement tendered on 26/9/2003 he stated that they had placed an order for Ceramic Tiles whereas their supplier supplied vitrified tiles and they had already written to the supplier rejecting the consignment. It was found that the tiles did not bear country of origin name and address of manufacturer in term of Section 117 of Trade and Merchandise Act, 1958. Therefore the consignment was held to be liable for confiscation in terms of Section 111(d) for contravention of Section 11 read with Notification 1/64 and in terms of Section 111(m) for contravention of Section 46 of the Customs Act. In Adjudication the Commissioner upheld the confiscation and imposed fine of Rs. 6 lakhs in lieu of confiscation. He also imposed penalty of Rs. 2 lakhs under Section 112(a). An amount of Rs. 51,59,542/- paid towards anti dumping duty was appropriated.

2. Ld. Counsel for the appellant stated that the commercial invoices accompanying the goods described them as Ceramic tiles, moreover vide their letter 19/7/2003 to the supplier have rejected the tiles having defects. In the subsequent correspondence they requested the supplier to take back the goods. The supplier vide letter dated 22/9/2003 gave willingness to take back the goods. Ld. Counsel prayed for leniency and reduction in redemption fine and penalty. According to him fine is higher than margin of profit.

3. Ld. A.R. reiterates the findings of the Ld. Commissioner.

4. We have carefully considered the submissions made by both sides.

5. There is no dispute that appellant paid Anti-Dumping duty on deciding the tiles drawn out to be vitrified tiles. Therefore it is apparent that they mis-declared the tiles as Ceramic tiles which could have resulted in huge loss of anti dumping duty, therefore the goods are liable to confiscation under Section 111(d) and 111(m) of the Customs Act. Ld. Counsel prayed for reduction in fine. He has not been able to inform the Bench as what is margin of profit to enable us to determine appropriate amount of fine and penalty. At the same time, we do find that invoices accompanying the tiles described the same as Ceramic Tiles. As observed by the Ld. Commissioner, it is seen that appellants letter dated 19/7/2003 to the supplier intimated the same defects in the tiles and rejecting the consignment. Although this letter may have been on afterthought, the fact remains that the letter was recovered from the premises of the importer during search conducted on 24/9/2003. Delay in search conducted by the Custom is difficult to comprehend. This may have given chance to importer to write to the supplier but nevertheless as recorded by the Ld. Commissioner, letter was recovered during the search which is not established that the latter was afterthought. Another letter dated 22/9/2003 is also referred to in the adjudication order which is letter from the supplier for which he expressed his willingness to take back the goods supplied to the importer.

6. In the circumstances and facts that anti-dumping duty was paid before issuance of show cause notice it would meet ends of justice if the redemption fine and penalty are reduced. Accordingly, we order that that the redemption fine is reduced from Rs. 6 Lakhs to Rs. 4 Lakhs and penalty under Section 112(a) is reduced from Rs. 2 Lakhs to Rs. Lakh only.

7. Appeal is partly allowed to above extent only.

(Operative order pronounced in court)

Ramesh Nair Member (Judicial)

P.S. Pruthi Member (Technical)

sk

2 APPEAL NO. C/1033/04