PALS TRADING CO. LTD. AND Vs. CC

JUDGEMENT

(1.) These two appeals are directed against the order in original No. 1523/2004 dated 17.2.2004 passed by the Commissioner of Customs (Exports), Chennai by which the Commissioner has held the goods imported as Men's Woven Shirts, Men's cotton woven Shirts, Men's Knitted Shirts, Cotton knitted Men's Shirts, Men's knitted T -Shirts, Men's cotton knitted Shorts, Men's Nylon woven Shorts, Ladies Leather sandals, Rubber Slippers, Cotton towels of three different sizes. The Commissioner has also fixed the total assessable value to the goods at Rs 34,30,133/ - and has ordered confiscation of the goods under Section 111(1) and (m) of the Customs Act, 1962 with option to redeem the same on payment of fine of Rs 3,00,000/ - (Rupees three lakhs) under Section 125(2) of the Act ibid. He has also imposed penalty of Rs 1,00,000/ - (Rupees One lakh only) each on the appellants under Section 112(a) of the Act.

(2.) Brief facts of the case are that M/s Ashtalakshmi Marketing filed Bill of Entry No. 466198 dated 21.2.2003 under DEPB scheme through their CHA M/s Sea India Freight Systems for the clearance of the goods declared as Rubber Slippers and Cotton Towels. The goods were stated to have been supplied by M/s Pals Trading Co. Bangkok. The importers and the CHA subscribed to a declaration regarding the truth of the contents of the Bill of Entry as provided under Section 46(4) of the Act. Inspection conducted by the officials in Docks revealed that apart from the items declared in the Bill of Entry Viz. Rubber Slippers and 100% cotton towels of two sizes, undeclared items such as men's woven shirts, etc as mentioned in para 1 above were also found concealed behind the packages of Towels and Rubber slippers declared by the importer. After the mis -declaration was noticed, the CHA vide his letter No. SIFS 195/2003 dated 26.2.2003 submitted copies of letter dated 25.2.2003 from the importer addressed to the supplier and the reply dated 25.2.2003 received by the importer from the supplier. In the letter dated 25.2.2003 the importers have stated that what they had ordered for was 552 dozens of towels, 5000 dozens or napkins and 90 dozens of rubber footwear. In the reply dated 25.2.2003 furnished by the suppliers viz M/s Pals Trading Co, it was stated that there were chances that shirt packages would have got mixed up with the items viz. Towel, napkin and Rubber footwear and that the mix up had happened because of wrong packages in the container and that it was very difficult to find out quantity of shirts in the packages. Out of the items found in the consignment, only three items were declared in the Bill of entry viz. Rubber Slipper, Towel 14 x 14 and Towels 27 X 54 and the rest of the items were undeclared. Vide their letter dated 31.5.2003 addressed to the Deputy Commissioner of Sea Port, SIIB Section, the importers inter alia stated that "On examination of the goods, it was realised by the Customs as well as by them, that the goods packed in the Container No. MLCU 392584 -1 was NOT what was actually consigned by them and stated to have been supplied/shipped under the cover of Supplier's Commercial Invoice No. P 003/2003 dated 4.2.2003". They have also stated that they have no option but to abandon the garments found packed in the said container. It was in these circumstances that show cause notice was issued to the appellants which culminated in the order of adjudication passed by the Commissioner as noted above.

(3.) Shri A.K. Jayaraj, learned Counsel for the appellants submitted that in the present case the importers of the goods on finding that the goods imported was different from what they had ordered for, abandoned the goods. He has further submitted that so far as the supplier was concerned, when the mix up was brought to their notice by the importers, they have admitted their mistake about the wrong packings and it was also stated in their reply to the importers that it was very difficult to find out the quantity of shirts inside the container and they have requested Department for allowing re -export of the goods. However, their request for re -export was not allowed. The Counsel further submitted that identical case came up before this Bench in the case of M/s MV Marketing and Supplies v. CC, Chennai in Appeal no.,C/17/2004 and the Bench vide final order No. 861/2004 dated 8.10.04 has allowed re -export of the goods imported therein without payment of duty, but on payment of redemption fine. He has also invited our attention to the order of the North Regional Bench of the Tribunal in the case of CC, ICD, TKD, New Delhi v. Sewa Ram and Bros reported in 2003 (151) ELT 344 wherein the Tribunal held that penalty is not imposable in a situation where importer has abandoned the goods before clearance for home consumption. He therefore, prayed for allowing the appeals.