MVT INTERNATIONAL Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) IN the impugned order the ld. Commissioner of Customs held -

(2.) THE facts of the case in brief are on 30 -9 -1988, the appellants filed a Shipping Bill for export of Computer -Software. During the processing of the Shipping Bill some doubts arose about the value of the software described as Software System for Resume Data Bank on Oracle Platform. The matter was referred to the Director, Deptt. of Electronics who in turn referred the same to Electronic Research and Development Centre of India who opined that the valuation of the software in question comes to Rs. 8,67,856/ - as against the declared value of Rs. 38,05,350/ -. A SCN was issued to the appellants asking them to explain as to why the compact disc containing computer software should not be confiscated under Section 113 of Customs Act read with Section 18 of FERA and why penalty should not be imposed under Section 114 of the Customs Act for over -valuation of the goods. The appellants in reply to the SCN submitted that over -valuation of goods meant for export is not in offence under under Section 132 of the Customs Act read with Sections 18 and 67 of FERA; that the unit has signed a correct declaration; that the software was neither dutiable nor prohibited; that punishment cannot be inflicted under Section 132 by the Customs Authorities; that under Section 18 of FERA only realisation of full export value is relevant; that in cases where value declared is more Section 18(1) of FERA shall not be attracted; that FERA is concerned with regulation of foreign exchange and not with export of any goods; that there was no offence prescribed under FERA for over invoicing of exports; that Section 67 of FERA cannot be pressed into service to stop exports; that Section 18(1)(a) is not violated, therefore, the restriction imposed under Section 18(1)(a) cannot be deemed to have been meant under Section 11 of Customs Act; that the goods were neither dutiable nor prohibited and therefore, the same cannot be confiscated under Section 113 or its Sub -sections and hence penalty cannot be imposed under Section 114. In support of their contention the appellants cited and relied upon the judgment of the Hon'ble Calcutta High Court in the case of Collector of Customs, Calcutta v. Lexus Exports Pvt. Ltd. and the judgment of this Tribunal in the case of Shilpi Exports v. Collector of Customs and Badri Prashad & Sons Pvt. Ltd. v. Collector of Customs, Delhi. After careful consideration of the submissions made, the ld. Commissioner decided the issue as indicated above. Being aggrieved by this order, the appellants have filed the captioned appeal. Shri J.M. Sharma, ld. Consultant assisted by Shri A.S. Khan, ld. Consultant submitted that in the instant case goods are proposed to be confiscated under Section 113 read with Section 18 and penalty is proposed to be imposed under Section 14. He submitted that Section 18(1)(a) requires that exporter shall furnish to the prescribed authority a declaration in the prescribed form which among other things shall include the amount representing full export value of the goods. He submitted that the Hon'ble Calcutta High Court in the case of M/s. Lexus Exports Pvt. Ltd. Held

(3.) LD . Consultant therefore, submitted that since Section 67 of FERA provides the restriction imposed by Section 18(1)(a) of FERA be deemed to have been imposed under Section 11 of the Customs Act, 1962. He submitted that in the instant case there is no violation of Section 18(1)(a) of FERA then there is no violation of Section 11 of the Customs Act, 1962. He submitted that Section 18(1)(a) only restricts export, there is no other offence prescribed in the statute for such violation. He submitted that once the full export value is mentioned, export cannot be stopped. He submits that there is no other misdeclaration and therefore, the goods cannot be confiscated. Ld. Consultant submits that Section 113 of Customs Act, 1962 provides for confiscation of goods attempted to be improperly exported; that Section 113(d) provides that any goods attempted to be exported or brought within the limits of any Customs area for the purpose of export contrary to any prohibition imposed by or under this Act or any other law for the time being in force are liable to confiscation. He submits that there is no prohibition imposed in the instant case under the Customs Act, 1962; that none of the grounds mentioned in Section 11 of the Customs Act are applicable in this case. There is no prohibition imposed under FERA and therefore, confiscation under Section 113(d) was not warranted. Ld. Consultant therefore, submitted that the position being very clear the confiscation of the goods and imposition of penalty was not warranted and therefore, prayed that the impugned order may be set aside and the appeal may be allowed.