LAKSHMI PRECISION SCREWS LTD. Vs. CC

JUDGEMENT

(1.) THIS is an appeal against the order passed by the Commissioner of Customs (Appeals) Jaipur dated 1.9.1998 confirming the order -in -original passed by the Dy. Commissioner of Customs ICD, Patparganj, New Delhi. By the impugned order the redemption fine of Rs. 1,50,000/ - imposed by the Dy. Commissioner was confirmed. A penalty of Rs. 25,000/ - imposed by the Dy. Commissioner was also confirmed by the Commissioner (Appeals). The allegation against the appellant is that they had mis -declared in their shipping bill dated 27.10.1997, 93,800 pieces of 'Nut/bolts/screw made of stainless steel variety -X' valued at Rs. 4,33,775/ - FOB. The subject export was not discharged by Export Obligation against the quantity based advance licence and DEEC Book. In terms of the advance licence and DEEC, the appellant was required to export the goods made out of 'stainless steel variety -X'. On physical examination of the goods, it was found that the goods were actually shoulder bolts instead of nuts/bolts/screws and of magnetic type whereas goods made from stainless steel variety X should be non -magnetic in nature. On the above finding, the authorities below had ordered confiscation of the goods as well as the penalty mentioned above.

(2.) APPEARING for the appellants ld. advocate Shri P. Sridhar submitted that the appellants are not disputing the fact that there was mis -declaration of the goods. However he submits that there was no intention on the part of the appellants to evade the duty. The mis -declaration had occurred due to mischief committed intentionally by the staff of appellant Company with a view to putting the appellants into trouble. He submits that at the relevant time, there was some labour unrest in the appellant's factory and some of the misguided elements in the staff had deliberately misdeclared the goods in the shipping bill and therefore, it was not correct on the part of the authorities below to hold that the appellants had any mala fide intentions in making the mis -declaration and deliberately avoiding the payment of duty. In fact the authorities below had not found any mala fides on the part of the appellants. The Dy. Commissioner had only recorded the fact that there was a contravention of the provisions of Section 50(2) of the Customs Act read with Section 11(1) of the Foreign Trade (Development and Regulation) Act, 1992, and Rule 11 of the Foreign Trade (Regulation) Rules, 1993. Ld. Counsel also pleaded that it has also to be borne in mind that the appellants were one of the biggest manufacturers and exporters of similar goods in the region and they have also been awarded Outstanding Export Performance Certificate by the Government. Their record had been without blemish in the preceding 15 years. Having regard to these factors, the appellants should not have been visited with the penalty. The quantum of redemption fine should also have been much less, if at all, pleaded ld. Counsel.

(3.) I have considered the submissions and have perused the record. As rejoinder ld. Counsel submits that the reason why the appellants had initially stated that the mis -declaration was due to oversight, was because at the material time the strike was still on and it was only later it was found that the staff had attempted intentionally to mis -declare the goods in the shipping bill with a view to putting the appellants into trouble. This was the reason why there was apparent inconsistency between the stand taken by the appellants initially and the stand they took before the Commissioner (Appeals). I have noted the submissions made in the rejoinder. However, it is also a fact that mis -declaration has taken place and the appellants would have been able to avail to the benefit of Rs. 1,95,000/ - if the mis -declaration had not been detected and the export would have been allowed. Even apart from any proof of mala fide intention on the part of the appellants, it is not in dispute nor is denied by the appellants, that mis -declaration as alleged had taken place. The mitigating circumstances of labour unrest in the appellants' factory during the relevant period and the possible mischief played by the staff of the appellant does not in any way reduce the legal liability of the appellants for the mis -declaration in the shipping bill. The contravention of the Section 50(4) of the Customs Act read with the relevant provision of the Foreign Trade (Development and Regulation) Act and the rules is established beyond any doubt. As regards the quantum of the penalty, I do not find that considering the value of the goods which is approximately Rs. 4,33,775/ -, the amount of penalty of Rs. 25,000/ - is not on the higher side. Ld. Counsel submitted that the appellants had redeemed the goods on payment of redemption fine of Rs. 1,50,000/ -. Taking all the circumstances into consideration, I find that the impugned order does not suffer from any infirmity. I find no reason to interfere with the same. The appeal is accordingly rejected.