RAJENDRA BROTHERS 2 SHRI Vs. CC, NEW DELHI

JUDGEMENT

(1.) These are two appeals. The appellants have challenged the impugned order No. BKG/CC/ICD/TKD/26/2000 dated 31.3.2000. The Commissioner of Customs, New Delhi by this impugned order demanded customs duty of Rs. 30,37,436/ - and imposed a penalty of Rs. 6 lakhs on M//s.Rajendra Brothers and Rs. 1 lakh on Shri Ravinder Rastogi, partner of the firm.

(2.) The facts of the case in brief are that the appellants presentea shipping bill dated 19.8.89 for 1,800 bags declared to contain 90,000 kgs Zinc Oxide. The goods were examined by the Examiner, the officer recorded the examination report at the back of the shipping bill reading as "Inspected a lot of 1800 bags. Selected, opened 10% at random for examination and found to contain Zinc Oxide as per invoice, P/L and GR attached. Samples drawn from the bag." This examination report was also signed by the superintendent. The sample was taken and sent for laboratory test to Central Revenue Control Laboratory. The Chemical test of the sample confirmed that sample was of Zinc Oxide. The goods were allowed to be shipped to Hongkong. The goods were exported towards discharge of export obligation in terms of Advance Licence under DEEC Scheme. When enquiries were conducted on the basis of some intelligence at Hongkong it was revealed that the consignment exported under shipping bill dated 19.8.89 was lying uncleared at Hongkong. The intelligence indicated that the goods were misdeclared. Hongkong Customs drew representative samples of particular containers on 31.1.90 which they sealed and forwarded to the DRI. The samples were sent to the Central Revenue Control Laboratory for chemical test. The chemical test conducted on the sample sent from Hongkong indicated that the sample was composed of Carbonates of Calcium and Magnesium with traces of iron and insoluble matter. The sale proceeds were not remitted to Indian supplier till late October, 1992. Further enquiries were conducted which revealed that there was misdeclaration of the goods. A SCN was issued pm 1.12.94 to the appellants asking them to explain as to why the duty of customs amounting to Rs.30,37,436/ - payable at the time of import and clearance of 174.502 MT of Zinc by them but not paid by them should not be demanded and recovered from them under the proviso to Section 28(1) of the Customs Act, 1962 and why penal action should not be taken against them under Section 114 of the Customs Act, 1962.

(3.) In reply to the SCN, the ld. Counsel for the appellants submitted written submissions stating that the remittance of sale proceeds was receieved; that the chemical report in respect of samples drawn in India showed that the goods were Zinc Oxide; that this report supported the description of the goods in the shipping bill; that the sample reportedly drawn by the Hongkong Customs did not mention the numbers of the container; that the consignment was released to the Hongkong importer; that the samples were drawn at the back of noticee at Hongkong; that the samples were not properly drawn and made some other submissions. After considering the submissions and the facts on records, the Commissioner held as indicated above.