TMI Blog2008 (2) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... ivastava, Member (T) Order Jyoti Balasundram, Vice-President Vide the impugned order, the Commissioner of Customs has enhanced the CIF value of secondhand sailboat imported by the appellant herein to ₹ 1,68,01,785/- (US$ 3,63,675/-), rejecting the declared value of ₹ 1,21,32,120/- (US$ 2,60,000/-), and directed assessment of bill of entry accordingly, confiscated the yacht under the provisions of Section 111(d) for want of specific licence required for import of secondhand goods, Section 111(f) for non-filing of IGM for the vessel and Section 111(m) for undervaluation, with an option to redeem the same on payment of a fine of ₹ 25,00,000/- and has also imposed a penalty of ₹ 5,00,000/- upon the importe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the amendment carried out. In these circumstances, no contravention of Section 30 has been made out so as to warrant confiscation of the vessel under Section 111(f) of the Customs Act. Accordingly we set aside the confiscation under the above mentioned provision. 4. As regards Section 111(m), we find that the Commissioner has relied upon information downloaded from internet regarding sale of similar vessels (45' Prout Cataraman) at much higher prices. The Commissioner has subsequently verified the submission of the importer that Dreamcatcher Prout 1996 model valued at US$ 4,59,000/- (relied upon by the Revenue) was not sold in 2004, as claimed by the Revenue, and it was still shown as available for sale on the website and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T 464. Since the finding of undervaluation is based only on internet information and the amount for which the vessel has been insured, and reliance on both has already been rejected by the Tribunal in the decision cited supra, we hold that there has been no contravention of the provisions of Section 111(m). 5. No reasons have been adduced by the Commissioner for imposition of a heavy fine of ₹ 25 lakhs, which was vehemently assailed by the appellant. Section 125(2) of the Customs Act, 1962 casts a duty upon an adjudicating authority to furnish reasons for imposing a specified amount by way of redemption fine. The power to impose such fine is a discretionary one and it has to be exercised on the existence of relevant factors su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7) ELT 161 (SC) by setting aside the fine and penalty arrived at by the Tribunal. In the present case, the Commissioner has found that mens rea was present, since the importer did not disclose the insured value of the yacht on the GATT declaration form attached to the bill of entry, even though the insured value had a bearing on the value for customs purposes. Since we have already held that the insurance value has no bearing on valuation for assessment by customs, we set aside the finding that the importer had a guilty mind. Although mens rea is not required for imposition of penalty under Section 112(a) of the Act, we agree with the appellant that imposition of penalty is not mandatory and it depends upon the facts and circumstances of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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