COMMISSIONER OF CUSTOMS CHENNAI Vs. ASHU EXPORTS

JUDGEMENT

(1.) THE respondent had filed three shipping Bills under the DEPB Scheme for export of the goods declared as 100% polyester dyeing fabric. They had also furnished a declaration in terms of Section 50 (2) of the Customs Act, 1962 attesting to the correctness of the details furnished in the shipping bills and had given a declaration to the effect that they will not claim any duty drawback or benefit of duty for the licence under the duty exemption scheme. When the goods were presented for examination to the Docks Officers on 26-06-2003,it was found that all the cartons contained very inferior quality of Dyed Fabrics. Shipments of the goods were not allowed and the case was referred to the Special Intelligence and Investigation Branch (SIIB) of this Custom House for further investigation. A show cause notice was issued and the representative of the respondent accepted the value and also the mis-declaration and waived the issue of show cause of notice and requested that the adjudication order may be passed. It was held that there was a wilful attempt to export inferior quality fabrics in the guise of 100% polyester dyed fabrics by misdeclaring the value of goods and therefore, the goods were ordered to be confiscated with the option to redeem the goods on payment of fine and penalty of a sum of Rs. 10,00,000/- also imposed.

(2.) AGAINST that, an appeal was filed to the Customs, Excise and Service Tax Appellate Tribunal. The Tribunal held that since clause (ii) of Section 113 is a penal provision for an exporter of goods, attempting exportation, by indulging in misdeclaration of particulars with the ulterior purpose of claiming higher drawback under Section 75 of the Customs Act and since the goods in question were not of the said category that cannot be confiscated. Therefore, the Customs, Excise and Service Tax Appellate Tribunal set aside the order of confiscation and penalty. Against that, the present civil miscellaneous appeal has been filed on the following substantial questions of law:

(3.) THE learned Senior Central Government Standing Counsel submitted that the Tribunal erred in holding that since the goods were not prohibited goods, the notice under Section 113 was not warranted. The learned counsel submitted that the words "dutiable or prohibited" goods were omitted in section 113 of Customs Act 1962 by the Finance Act, 2003 (32 of 2003) with effect from 14-05-2003 and this was overlooked by the Tribunal and the learned Senior Central Government Standing counsel also submitted that when there is acceptance on behalf of the respondent that there was misdeclaration, the overvaluation itself would render the goods to be treated as prohibited goods within the meaning of the relevant section and when such overvalued goods are attempted to be exported out of India are liable to confiscation. The learned counsel raised a preliminary issue of maintainable issue and referred to 2004 165 ELT 34 (Pandh) (Commissioner of C. Ex. , Chandigarh Vs. Punjab Recorders Ltd.), 2003 (155) ELT 423 (SC) (Om Prakash Bhatia Vs. Commissioner of Customs, Delhi) and 2008 (226) E. L. T. 178 (Commissioner of Customs, Mumbai Vs. Classique Enterprises ).