M/S. Tirupati Metal Corporation vs Commissioner Of Customs (Import) Nhava ...

(Arising out of Order-in-Original No. S/108/2004 SIIB (I) dt. 7.5.2004 passed by the Commissioner of Customs (Import), JNPT Nhava Sheva)

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 : No 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?

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M/s. Tirupati Metal Corporation : Appellant

VS

Commissioner of Customs (Import) Nhava Sheva : Respondent

Appearance

Shri N.D. George, Advocate for Appellant

Shri M.K. Mall Assistant Commissioner (A.R) for respondent

CORAM:

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

Date of hearing :28/07/2015 Date of decision : 28/07/2015

ORDER NO.

Per : Ramesh Nair

The appeal is directed against Order-in-Original No. S/10-8/2004 SIIB(I) dated 07.05.2004 passed by the Commissioner of Customs (Import), JNCH, Nhava Sheva, wherein the following order was passed-

(i) Confiscated the goods covered by B/E No. 9869790 dated 23.02.2004 and valued at Rs.28,89,600/- under Section 111(m) of the Customs Act, 1962, however allowed redemption on payment of fine of Rs. 6,00,000/- (Rupees six lakhs only), keeping in view detention and demurrage charges of Rs.2,00,000/- (Rupees two lakhs only) accrued.

(ii) Transaction value was rejected and ordered the assessment to be done at USD 3270/- and realization of excess duty forthwith.

(iii) Imposed a penalty of Rs.1,20,000/- under Section 112 (a) of the Customs Act, 1962.

2. The fact of the case is that the Appellant filed a Bill of Entry No. 969790 dated 23.02.2004 in respect of import of 20MT of Ni/Cr alloy scrap which was assessed @ USD 800/-PMT. The duty payment amounted to Rs.1,55,621/-. On the investigation carried out by the officers of SIIB (I) JNCH it was gathered that the appellant has mis-declared the imported goods as Stainless Steel Melting Scrap 304 whereas on examination it was found that the goods were of Nickel Based Super Alloys thus the appellant has mis-declared the goods as well as undervalued. The goods i.e. Nickel Based Super Alloys is classifiable under CTH 7503001 as against the stainless steel melting scrap. The Bill of Entry was assessed on the enhanced value as Nickel Alloy Scrap and the appellant paid the duty on the enhanced value under the revised classification and cleared the goods. For the charge of mis-declaration and undervaluation the subject goods covered under Bill of Entry No. 9869790 dt. 23.2.2004 valued at Rs.28,89,600/- was confiscated under Section 111(m) of the Customs Act with option of redemption on payment of fine of Rs.6,00,000/- (Rupees six lakhs only), a penalty of Rs. 1,20,000/- was also imposed under Section 112(a) of the Customs Act. In the impugned order it was also ordered to reject the transaction value and re-determine the value at the rate of US$ 3270/- PMT and accordingly the assessment was directed to be done and excess duty be realized forthwith. Aggrieved by the impugned order the appellant filed appeal for setting aside the order dt. 10.5.2004.

3. Shri N.D. George Ld. Counsel appearing on behalf of the appellant, at the outset submit that the appellant is not disputing enhancement of the valuation and duty thereon which has already been paid at the time of clearance of the goods. The Ld. Counsel fairly submits that the appellant is not pressing the valuation issue, however their grievance is only regarding fine and penalty. He submits that in the process of investigation, assessment and clearance of the goods, the appellant has suffered with the huge amount of Rs.2,00,000/- as detention charges, therefore the fine and penalty is on quiet higher side. He submits that since appellant has fully co-operated with the Customs authorities and paid the entire Customs duty as assessed by the department on the enhanced value, therefore the fine and penalty imposed is much higher and he prays to reduce the same. In support of his submission he placed reliance on this Tribunals judgment in the case of Kevin Infotech (P) Ltd. Vs. Commissioner of Customs (Port), Kolkata 2007 (216) E.L.T. 435 (Tri.- Kolkata). He submits that in the said judgment on the identical set of facts the penalty and fine was set side.

4. Shri M.K. Mall Ld. Assistant Commissioner (A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order. He further submits that this is an admitted case of mis-declaration of goods, mis-classification and undervaluation. Therefore the lower authority has rightly imposed the redemption fine and penalty which does not require any interference.

5. We have carefully considered the submissions made by both the sides. We observed that the appellant admittedly mis-declared the goods and also under valued, therefore they are liable for penal action. However, we find that the appellant has suffered heavy demurrage and detention charges during the process of investigation and clearance of the goods. It is also observed that the appellant have co-operated with the officers and discharged the Customs duty liability even on the enhanced value also. We are therefore of the view that taking into consideration the above position the appellant deserve some leniency as regards fine and penalty. We, therefore, reduce the fine from Rs.6,00,000/- (Rupees six lakhs only) to Rs.4,00,000/- (Rupees four lakhs only). However, order of reassessment and penalty imposed are maintained. The appeal is partly allowed in the above terms.

(Pronounced in court)

(P.S.Pruthi) Member (Technical)

SM.

(Ramesh Nair) Member (Judicial)

5 Appeal No. C/645/2004