Khazana Vs Commissioner of Customs (CESTAT Hyderabad)
The Hyderabad Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) heard appeals against Order-in-Original No. 04/2011-Adjn.(CUS) dated 26.04.2011, by which the Commissioner of Customs confirmed differential customs duty of ₹1,03,045, demanded interest under Section 18(3) of the Customs Act, 1962, held the imported furniture liable to confiscation under Section 111(m), imposed redemption fine of ₹50,000 under Section 125, and imposed penalties under Section 112(a) on M/s Khazana and its Managing Partner, Shri Bhawant Anand.
The appellants accepted the differential duty and interest and deposited the amounts. Before the Tribunal, the dispute was confined to the legality of the confiscation, redemption fine and penalties.
According to the record, the appellant imported furniture from China. Acting on intelligence regarding systematic undervaluation, the Directorate of Revenue Intelligence (DRI) investigated imports covered by a Bill of Entry dated 18.01.2018. The goods were provisionally assessed under Section 18(1) of the Customs Act and released on execution of bond and bank guarantee. During investigation, the DRI recovered laptops, hard discs, DVDs and commercial documents from the importer’s premises. The Department relied upon a commercial invoice allegedly showing the actual transaction value at USD 14,144, whereas the Bill of Entry declared USD 10,127. It also relied on electronic data recovered from the seized devices and on the statement of Shri Bhawant Anand recorded under Section 108 of the Customs Act, which, according to the Department, admitted that the actual value of the imported goods was approximately USD 14,000. A show cause notice thereafter proposed rejection of the declared value, re-determination of assessable value, confiscation, recovery of differential duty, interest, redemption fine and penalties. These proposals were confirmed by the Commissioner.
