RAHMAN EXPORTS (P) LTD. Vs. CCE

JUDGEMENT

(1.) THE appellants had imported Mould Doctor with accessories from Korea and filed bill of entry No. 530966 dated 7.8.2003 classifying the goods under Customs Tariff heading 8453.9090 claiming concessional rate of duty vide Sl No. 257 of Notification No. 21/2002 -Cus and claiming the goods as moulds for leather footwear mentioned at Sl No. 265 of List 34, relevant to Serial No. 257 of Notification No. 21/2002. Since from the description of the goods given in Bill of Entry, the classification and claim for exemption was not clear, the appellants were asked to submit the documents for proper classification and for examining the exemption applicable for the goods. The commercial invoice was filed by the appellants on enquiry from the customs. The catalogue of the goods revealed that the goods were tools and were not moulds for leather footwear. Therefore, the first check examination was ordered for classification. Instead of getting the goods examined, the appellants vide their letter dated 15.9.2003, filed a request for amendment of Bill of Entry and submitted EPCG License No. 063000068 dated 18.7.2003 for Mould Doctor with accessories and the same was submitted in the Customs House for registration and for allowing the warehousing of the goods under their letter dated 20.9.2003. They intimated that they have got the EPCG license registered in Group VII and requested for transfer of bill of entry to Group VII. The bill of entry was submitted for examination on 30th September, 2003 and the goods were examined on the same date. The goods on examination were found to have multi purpose use. These are not only used in the leather industry but can be used for other industrial purposes. These were found to be classifiable under heading 8461.9000. After granting personal hearing on 23.10.2003, the case was adjudicated and the goods were classified under heading 8461.9000. The adjudicating authority ordered confiscation of the goods under Section 111(m) of the Customs Act but gave the appellants option to redeem the goods on payment of fine of Rs. 50,000/ -. He also imposed a penalty of Rs. 5,000/ - on the appellants under Section 111(a) of the Customs Act. He also allowed the goods to be assessed on payment of fine and penalty. The appeal filed by the appellants against the order of the original authority was rejected by the Commissioner (Appeals).

(2.) IT was argued for the appellants that they are only contesting imposition of penalty and of redemption fine on the goods confiscated under Section 111(m). It was argued that they had filed amendment to the bill of entry which should have been accepted but the adjudicating authority instead of accepting the amendment of bill of entry, confiscated the goods and imposed penalty. Reliance was placed on the following decisions that penalty cannot be imposed:

(3.) ON behalf of the Revenue, it was argued that it is not the case of simple mis -declaration on the part of importer i.e. the appellants but they were very well aware that what they are importing as mould doctor which not a product of leather industry but it can be used for other industries also. They have taken EPCG licence in July, 2003 much before this import for leather industry and got it registered with different group of customs. But this fact was not disclosed when the goods were wrongly classified and exemption was claimed under Notification No. 21/2002. Therefore, the appellants have taken a chance by mis -declaring the goods claiming wrong exemption. When they were asked to produce the goods for examination, instead of getting the goods examined, they filed amendment to the bill of entry. However, the examination was done subsequent to that and it was found that the goods were not eligible for exemption under the Notification. Therefore, the adjudicating authority had correctly held the goods liable for confiscation and imposed penalty which was upheld by the Commissioner (Appeals) under the impugned order. It was, therefore, pleaded that the appeal may be dismissed.