BENARA UDYOG PVT. LTD Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) APPELLANT herein is M/s. Benara Udyog Pvt. Ltd., Agra. They are engaged in the business of manufacture of bearings and crushes. They entered into an agreement with a foreign company known as M/s New Tech Engineering Service, 226 -11, Jung Rim Dong Seo Ku, Taejeon City, South Korea on 24 -5 -1996 for getting the technical know -how with the approval of the Reserve Bank of India evidenced by letter No. EC.CO.FITT/19/12.51.00 (B -135)96/97, dated 11 -7 -1996. Total consideration as per that agreement for getting this technical know -how was US 1,50,000. The said amount was to be paid in instalments as specified in Clause 5 of that agreement. Pursuant to that agreement, technical drawings and designs were supplied under eight airway bills. For clearing the goods sent by those airway bills authorised courier DHL Worldwide Express filed bill of entry on 1 -11 -1996. The airway bills showed value at US 15. Those consignments were not cleared by the Customs authorities because of their suspicion regarding the valuation. The eight packages sent under the eight airway bills were opened in the presence of the importer's representative and it was found that the drawings and technical documents have been imported as per the technical know -how agreement entered into between the appellants and the foreign company. Thereupon, show cause notice was issued on 2 -4 -1997 proposing to reject the invoice value of US 15 for the drawings and blue prints covered by each of the airway bill and real transaction value for the purpose of Section 14 of the Customs Act at US 40,000 be accepted. Noticee was also asked to show cause why the goods imported by the airway bills should not be confiscated and penal action under Section 112 of the Act should not be taken. Appellant disputed the stand taken by the Department in the show cause notice and even went to the extent of contending that they had nothing to do with the import of the goods for the clearance of which DHL Worldwide Express filed the bill of entry. Adjudicating authority rejected the contentions raised by the appellant and by order -in -original No. 63/A and R/VS/97, dated 26 -9 -1997 fixed the value of the goods at US 40,000 FOB, confiscated the same with option to redeem it on payment of redemption fine of Rs. 5 lakhs and imposed a penalty of Rs. 2 lakhs under Section 112 of the Customs Act.

(2.) THE main argument advanced by learned counsel representing the appellant was that appellant had not authorised to DHL Worldwide Express, a courier, to file the bill of entry on their behalf and so, they are not the importers or the owners of the goods which landed pursuant to the eight airway bills. Learned counsel further submitted that the bill of entry filed by the courier and the examination conducted by the Customs authorities were not made available to them to make an effective representation regarding their ownership. Argument even went to the extent of saying that the appellants were not liable for any penalty under Section 112 of the Act because they did not do or omit to do anything which will warrant imposition of penalty under that Section. Before going into the question as to whether the courier acted in their own accord in filing the bill of entry without an authorisation by the appellant, we will first deal with the contention that appellants were innocent of all these transactions that took place between the Customs and DHL Worldwide Express courier.

(3.) LEARNED counsel's arguments that the bill of entry filed by DHL Worldwide Express - the authorised courier was not on the authorisation given by them that copy of bill of entry and the examination note entered on its back were not made available to the appellant are factually incorrect. Annex -ure 3 to the show cause notice given to the appellant is "Courier Bill of Entry for Dutiable Goods" filed by DHL Worldwide Express. On the back of it was written report of "Examination of 8 packages". The show cause notice with the annexures was received by the appellant. That show cause notice alongwith the annexures was filed before this Tribunal by the appellant. Annexure 2 to the show cause notice is a letter sent by the appellant to Airport Customs on 29 -10 -1996. That letter reads "We authorise Mr. D.V. Kumar, S/o Shri H.B. Kumar to represent our company for examination/verification of drawings/documents received against above consignments and/or any other work connected with the clearance of the same." Signature of Shri D.V. Kumar seen in that letter has been attested to by Shri P.L. Jain, the Director of the appellant's company. This Shri D.V. Kumar was present at the time of inspection of the eight packages. He signed the inspection report seen on the back side of the bill of entry as representative of the company. The company mentioned therein was the appellant and none other than this appellant. In view of these circumstances, it is too late in the day for learned counsel for the appellant to advance an argument that appellant was innocent of this import and that they had not authorised the DHL Worldwide Express to file the bill of entry.