Decor Rubber Industries Vs Commissioner of Customs (CESTAT Delhi)
CESTAT Delhi held that the values declared by the exporter before the Chinese authorities was much higher than the values declared in the Bills of Entry and appellant has failed to produce any cogent document to disprove the allegation of mis-declaration in the export declaration.
Facts- M/s.Decor Rubber Industries, the appellant, has been importing goods namely unbranded “Reflective Sheets”. Acting on an intelligence, the containers covered under the bill of entry filed by the appellant through its Customs Broker M/s. Sajeev Kumar was preliminarily examined. The imported goods were found to be supplied by M/s. Changzhou Hua R Sheng Reflective Materials Co. Ltd., China. The goods were found to be rolls of branded Reflective Sheets of brand name “Sablite”. Two types of reflective sheets of series TM3200 AB and TM1800 of 1219 and 5 rolls respectively were found. The value of these goods declared in the Bill of Entry was Rs.15,41,721.53. The examining officer doubted these values as they were too low.
During investigation, it was also found that the appellant had imported the same goods through fourteen other bills of entries in the past declaring similar prices. It was felt that the goods imported under these past Bills of Entry were also undervalued and were, therefore, liable to confiscation.
Show cause notice proposed recovery of differential duty under the proviso to section 28(1) of the Act alongwith interest u/s. 28AA and 28AB. The goods imported were detained and provisionally released were proposed to be confiscated u/s. 111 (m) of the Customs Act, 1962. In addition, penalty was proposed to be imposed on them u/s. 112(a), 112(b), 114A and 114AA.
Conclusion- The mode of procuring the documents during investigation and the absence of any other Export Declarations with the appellants is therefore sufficient for us to hold that the appellant has failed to rebut the presumption of correctness attached to these documents in terms of section 139 of the Customs Act. Appellant has not produced any other cogent document to show that price as was declared to the Chinese Customs was different from the price which is mentioned in the export declaration obtained by the department from China through Consulate General of India The Export Declarations as received from China are, therefore, admissible in the evidence.
The values declared by the exporter before the Chinese authorities was much higher than the values declared in the Bills of Entry by the appellant. We, therefore, find that the appellant was liable to penalty under section 114AA and the penalty of Rs. 10,00,000/- was just and fair in the factual matrix of this case.
FULL TEXT OF THE CESTAT DELHI ORDER
Present is an appeal assailing the Order in Original bearing No. 03/20211 dated 9th April, 2021. The facts in brief relevant for the appeal are that M/s. Decor Rubber Industries, the appellant, has been importing goods namely unbranded “Reflective Sheets”. Acting on an intelligence, the containers covered under bill of entry No.874293 dated 09.02.2010filed by the appellant through its Customs Broker M/s. Sajeev Kumar were preliminarily examined on 17.02.2010. The imported goods were found to be supplied by M/s. Changzhou Hua R Sheng Reflective Materials Co. Ltd., China. The goods were finally examined on 23.02.2010 by the officers of the Special Intelligence and Investigation Branch (SIIB) of the Commissionerate in presence of two independent witnesses. The goods were found to be rolls of branded Reflective Sheets of brand name “Sablite”. Two types of reflective sheets of series TM3200 AB and TM1800 of1219 and 5 rolls respectively were found. The value of these goods declared in the Bill of Entry was Rs.15,41,721.53 (USD 32758.58). The examining officer doubted these values as they were too low. The goods were detained and a market survey was done on 18.02.2010 in which quotation from M/s. Surya Plastics, Paharganj, New Delhi was obtained which showed that the price of similar Reflective Sheets was Rs.8,000 per roll (Roll size is 1.2 Mtr x 45.7 Mtrs.) and other reflective sheets were priced Rs.36,000/- to Rs.39,000/- per roll. The value declared in the Bill of Entry was Rs.15,41,721.53 which works out toRs.1247/- per roll. Hence it was felt to be very low.
2. During investigation, it was also found that the appellant had imported the same goods through fourteen other bills of entries in the past declaring similar prices. It was felt that the goods imported under these past Bills of Entry were also undervalued and were, therefore, liable to confiscation. It was felt that the values declared in these fifteen Bills of Entry totaling Rs.1,29,50,222/- was low and it should be Rs.5,44,86,414/-.
3. In order to investigate the matter further, enquiries were conducted overseas and it was found that there was a vast difference between the prices declared in the Bills of Entry before the Indian Customs by the appellant and the values declared by the exporter to the Chinese Customs authorities. With respect to four containers in Bills of Entry dated 22.04.2018, 30.06.2018, 01.08.2018 and 27.10.2018 tabulated below were compared with the values declared for those very consignments of goods before the Chinese Customs authorities and the values declared in the Trade Declarations before the Chinese Customs were four times the values declared before the Indian Customs. In view of this response department formed the opinion that the importer undervalued their goods at the time of import to evade payment of customs duties.
