OLYMPIA OVERSEAS Vs. COMMISSIONER OF CUSTOMS, COCHIN

JUDGEMENT

(1.) THE following appeals have been filed against the orders -in -original Nos. 54/2005, dated 30 -11 -2005 and 51/2005, dated 30 -11 -2005 passed by the Commissioner of Customs, Cochin :

(2.) SINCE the issues involved in both the appeals are one and the same, we are taking up the matter for issue of common order.

(3.) THE first appellant filed three shipping bills dated 21 -2 -2003 for export of goods declared as 100% poly and poly fabrics. The declared values C&F in terms of the US $ are 1.19 per metre (Rs. 57 per metre). These exports were done under the DEPB Scheme by which the exporters are entitled for the duty credit which can be used for paying duty on imported goods. Initially the goods were allowed on a provisional basis for export under the scheme. As there was doubt about the values declared by the appellants, samples were taken and subjected to chemical test. In order to find the correct market value of the goods, the samples were taken for market inquiries and verification. It is seen that, the appellants have declared a very high value for the goods which will help them in getting more credit. The value declared was about Rs. 57/ - per metre, whereas on market inquiries the values ranged from Rs. 7 to Rs. 13. Further, it was found that the goods were of very poor quality and they had damaged the appearance. Some samples were forwarded to Textile Committee, Kannur, who reported that the goods were made of polyester of a weight per linear metre ranging from Rs. 21 to Rs. 27 metre. Since the value declared by the appellants was very high, Revenue proceeded against them by issue of show cause notice. After examining the issue, the Commissioner assessed the goods at Rs. 16 per metre for DEPB purposes. As it is conclusively proved through investigations, that the FOB value of the impugned goods had been artificially inflated in order to avail higher DEPB benefits. The Commissioner held that the appellants were liable for penalty under Section 114(i)(iii) of the Customs Act, 1962.