TMI Blog2009 (9) TMI 359X X X X Extracts X X X X X X X X Extracts X X X X ..... nation of export by customs, levy of penalty of Rs.50,000/- is justified to prevent recurrence of such practice thus, appeal is partly allowed to the extent indicated above and Drawback/DEPB claim is to be recomputed in the light of aforesaid directions. Excess of Drawback/DEPB claim availed shall be recoverable with interest. - C/139/2006-Cus. - C/399/2009(PB), - Dated:- 15-9-2009 - S/Shri D.N. Panda, Member (J) and Rakesh Kumar, Member (T) Shri L.P. Asthana, Advocate, for the Appellant Shri Sumit Kumar, DR, for the Respondent. [Order per: D.N. Panda, Member (J)]. - This appeal has been filed by the assessee against the order of adjudication dated 28-11-2005 passed by the learned Commissioner giving rise to the following consequences:- (i) Drawback amount of Rs.8,61,350.81 was ordered to be recovered from the appellant under Section 75A(2) of the Customs Act, 1962 read with Rule 16 of the Customs and Central excise Duties Drawback Rules, 1995. (ii) Interest on the amount recoverable under (i) above is payable under Section 28AA of the Customs Act, 1962 read with Rule 16 of the Customs and Central Excise duty DBK Rules. (iii) DEPB amount of Rs.62,585/- claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A/04-05 dated 27-9-04 was same as that of declaration of such goods in invoice No. 10/04-05 dated 24-9-04 and No. 10-A/0405 dated 27-9-04. Certificate of origin issued by Delhi Chamber of Commerce exhibited aggregate value of goods was only US $ 13435.74. 2.5 In response to question of investigating agency as to why different invoices showing different value were issued for the purpose of Shipping Bill and for obtaining certificate of origin, Shri Arjun Prasad expressed his ignorance and stated that Shri R.C. Goyal who is the Director of the company can only explain. 2.6 Shri R.C. Goyal, Director of the Appellant company vide his letter dated 5-11-2004 stated that he is the working Director of the appellant company. Total drawback/DEPB benefit claimed in the past five (five) years do not exceed Rs.57.00 lakhs. There was no over-valuation of their goods and they are substantially entitled to the benefit claimed even though the certificate of origin issued by Delhi Chamber of Commerce reflected value of the goods lower than the invoice value forming part of Shipping Bill and lower value was reflected at the instance of the buyer. However, shipping invoices were correct since ship ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant with an intention to avail excessive drawback/DEPB followed the practice of issuing parallel invoices system and established that while one set of invoices was sent alongwith the shipping bills, other set is sent to Delhi Chamber of Commerce for issue of Certificate of Origin. This called for calling back of drawback amount of Rs. 8,61,350.81 and DEPB amount of Rs.62,585.88 aggregating to Rs.9,23,936.69 followed by penalty imposed on the appellant. 2.9 In view of the aforesaid circumstances, investigation was of the belief that in view of over-invoicing of the goods, the drawback/DEPB were not lawfully claimed and over-invoiced goods became prohibited goods. 3. Show cause notice was issued to the appellant making above allegation. In reply to the show cause notice, the appellant submitted that it is a merchant exporter and exported most of the goods directly procured from the manufacturing factory following excise procedure of AR-4/ARE-1. Value of the goods as assessed by the Jurisdictional Excise authorities in respect of the goods procured from manufacturers were exported and value thereof finalized. Value of export was also realized. There was no over valuatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause that had met the scrutiny of Excise authorities at the time of clearance and that had formed part of the statutory documents filed by the manufacturers and whenever customs authority found that there was over-valuation, they reduced value of the goods in those cases. In absence of any cogent evidence, neither Revenue can dispute value of goods relating to 13 invoices relating to procurement of goods directly from the manufacturers nor can dispute goods procured from traders when no traders were examined. 6. Learned Counsel for assessee further argued that the principle relating to claim of drawback and DEPB is to determine value of goods with reference to the invoice value of goods manufactured and in case of merchant exporter procuring goods from traders, value of goods shall be determined with reference to cost incurred for purchase of such goods by merchant exporter. Following such rule, the appellant had made appropriate claim of drawback/DEPB. When the source of exportable goods had come to knowledge of authority and that remained undisputed, export value of goods exported cannot be reduced. Circular No. 15/97 dated 3-6-1997 requires the exporter to declare present mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee and that was not discharged. When the assessee failed to establish good reason why invoices showing lower value of goods were issued to Delhi Chamber of Commerce, it has to suffer the consequence of adjudication. Citations made by the appellant do not help when the appellant made false claim. 9. Heard both the sides extensively. There is no dispute that the appellant is a Merchant Exporter. There is also no dispute that the appellants had purchased goods through 13 invoices from manufacturers and through 13 invoices from traders. Goods purchased through 13 invoices from traders failed to prove the source of manufacture and payment of excise duty thereon. No verification was possible from excise records in respect of such purchases. There is also no dispute that the documents received from Delhi Chamber of Commerce showed lower value of the goods while the invoice enclosed to shipping bills, showed higher value. Further there is no dispute in absence of any cogent finding that export value was not realised. 10. Scheme of grant of Drawback/DEPB is to pay back the taxes and duties levied on inputs to the exporter. There is no difficulty to understand that 13 invoices cl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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