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TMI Blog2015 (9) TMI 1315X X X X Extracts X X X X X X X X Extracts X X X X ..... mises of the appellants on a specific intelligence. Audio-visual equipments imported worth Rs. 57,55,770/- were found in the business premises of the appellant which did not have MRP displayed on the packing though these goods were imported by paying duty on RSP declared. The goods were seized on the same day. Later goods were provisionally released on furnishing bond of 100% value of seized goods and bank guarantee of 25%. Differential duty of Rs. 6,93,820/- was deposited. It is also alleged that on enquiry it was found that the appellants sold such imported goods to NCCF/KB at a price higher than the RSP declared at the time of import. The appellants had sold goods to retailers and other customers besides sale to NCCF/KB. A show cause notice was issued alleging mis declaration of RSP, and proposing inter alia, demand of differential duty taking into consideration the price at which goods were sold to NCCF/KB. The notice was finalized by the order which (a) confirmed the confiscation of goods worth Rs. 57,55,770/- (market value of the goods which did not display MRP on packing) and as the goods were provisionally released a fine of Rs. 5,00,000/- was imposed in lieu of confiscatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entered with Kendriya Bhandar/NCCF was for a price higher than that declared at the time of import. Further, that it is not possible for the appellants to foresee prior to import as to whom the goods will be sold after the import. v) That demand of differential duty of Rs. 1,50,88,287.05/- raised on the entire goods imported during the period 2002-2003 to 2004-2005 is totally illegal as only small percentage of sale was effected to NCCF/KB. Major portion of the goods were sold to ordinary customers at RSP or lower than RSP. The adjudicating authority has erred in taking the rate shown in the pricelist of the supply made to Kendriya Bhandar/NCCF for the entire sales affected by the appellants during the disputed period. The supply to NCCF/KB was only 20% and the major supply was made by the appellant to ultimate consumers/retailers at a price lower than the RSP declared. This aspect that the appellant had made major supply below the RSP was not taken into consideration at all. The assessment of differential duty on the basis of the price list of goods sold to NCCF/ KB is wholly unjustified as the appellant has made only 20% sale of goods imported to NCCF / KB. The rest was s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional buyers, the provisions of SWM Act 1976 and PC Rules 1977 are not attracted to the supply of goods to these customers. That the Board s Circular No.625/16/2002-CX dated 28.02.2002 was in force at the relevant time and that the appellants were under bonafide belief that the provisions of SWM Act 1976 & PC Rules 1977 was not attracted when goods are sold to NCCF/KB. Refuting the above contention of the appellant, the learned DR submitted that NCCF/KB are not institutional consumers. The sales effected to them are not outside the purview of SWM Act 1976 & PC Rules 1977. Such sale is a sale to the ultimate consumer. For a better appreciation the relevant definitions & provisions are noticed as under: "retail dealer Rule 2(o) in relation to any commodity in packaged form means a dealer who directly sells such packages to the consumer and includes, in relation to such packages as are sold directly to the consumer, a wholesale dealer who makes such direct sale. "retail package means a package containing any commodity which is produced, distributed, displayed, delivered or stored for sale through retail sales agencies or other instrumentalities for consumption by an individual or a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t disputed that the goods are notified under section 4A of the Central Excise Act, 1944. It is then incumbent upon the importer to declare the RSP upon the package. The appellant, as per the provisions of law, can sell the goods at RSP or below RSP only. The appellants do not dispute that the sale effected to NCCF/KB was for a price higher than the RSP declared at the time of import. Their argument is that the provisions of SWM Act 1976 & PC Rules 1977 do not apply to the sales effected to NCCF/KB. We are not able to agree with this contention of the appellant. NCCF/KB are not institutional consumers. NCCF/KB purchase goods in bulk for effecting sale to ultimate consumers and do not fall into the category of institutional consumers. Further the appellants have no case that they displayed upon the packages that the packings were for sale to institutional consumers and not for retail sale. The argument on behalf of the appellants that the appellants relied upon the Board Circular dated 28.2.2002 and was under the belief that MRP need not be affixed in effecting supply to NCCF/KB is without merits. As already stated NCCF/KB would not come within the description of institutional consum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , that sales effected to customers other than NCCF/KB were made at RSP or prices lower than the RSP declared at the time of import. In such circumstances we have to agree with the appellant s contention that the demand of differential duty on goods sold below RSP or goods sold at RSP is unjustified. Merely because the importer effected sale of some goods at price higher than the RSP declared, the Revenue cannot demand differential duty on entire import done as per various B/E during the period 2001- 2002 to 2004-2005. 10. In CCE Vododara Vs. Bell Granito Ceramics Ltd. (supra), the Tribunal observed that Section 4A requires payment of duty on the MRP affixed as per provision of SWM Act. That there is no stipulation in the said Act that all packings should bear the same MRP. It is a prerogative of the manufacturer to affix the MRP on the goods and if different MRPs are affixed keeping in view of the market conditions, different MRP so fixed would be the retail sale price in respect of each packet. 11. Explanation 2 to Section 4A is to the effect that where more than one retail price is declared on the packet, the maximum of such retail price shall be deemed to be the retail price f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eev Ratra, Director of SVPL Ltd. A penalty of Rs. 25,00,000/- is imposed upon him under Section 112 (a) of Customs Act 1962. The ld. DR submitted that Shri Sanjeev Ratra being the Director of the Company is in-charge of all day to day affairs and is responsible for mis-declaration of RSP and thereby evasion of duty. Refuting this, the ld. Counsel for appellant argued that Shri Sanjeev Ratra was only an employee of the company and was under the bonafied belief that as per the Board Circular dated 28.8.2002 the provisions of SWM Act, 1976 and PC Rules 1977 were not applicable for the sales made to NCCF/KB. That at the time of import the appellant could not for see to whom the goods would be sold. These submissions are not without merits. The appellant sold the imported goods not only to NCCF/KB but to other customers also. The goods sold to other customers were sold at RSP or prices lower than the RSP declared. The appellant did not import goods for sale solely to NCCF/KB. Further the Board Circular was also in force at that time. In such circumstances the imposition of penalty of Rs. 25 lakhs in our view is slightly on the higher side. We consider that the penalty imposed is liable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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