9911796707
TMI Blog1996 (6) TMI 355X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 1,00,000/-, holding the appellant guilty of misdeclaration of description and value of the machine in order to obtain the benefit of OGL and to evade payment of duty and imposing penalty of ₹ 50,000/- on the appellant and ₹ 25,000/- on one of the Directors of the appellants' sister concern under Section 112 of the Act. The Collector did not impose penalty on the other officers of the appellant. 2. The imported machine was second hand machine. Appellant declared the machine as "fully programmed paper cutting machine with three knife trimmers and accessories and spares" and declared value as ₹ 15,94,044/-. The machine was assessed on the invoice value and duty was paid and the machine cleared. The Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een imported under OGL. 3. The appellant denied the material averments in the show cause notice with reference to the description of the machine, the permissibility of import under OGL and the valuation. The Collector, however, rejected these contentions and passed the impugned order holding that the machine was a slitter cum rewinding machine and not paper cutting machine falling under the aforesaid item and could not have been imported under OGL but required specific licence. The Collector determined the CIF value at the time of import at ₹ 2,59,181 and the differential value originally assessed and presently assessed differential duty. 4. Learned counsel for the appellant contended that even assuming that the machine imported cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person unconnected with printing industry but running a plastic industry where also a cutting machine would be necessary. The Bench relied on the Explanatory Note to Heading 84.33 to the effect that Heading includes "slitter-reelers" for unwinding reels of paper and cutting the paper into bands of required width and rewinding it. The Bench also relied on Explanatory Note to Heading 84.41 of the HSN to the effect that it included winders (slitter-winders) for unwinding reels of paper, slitting the paper into bands(slits) of the required width and rewinding it and held that a slitter cum rewinding machine is internationally recognised as a paper cutting machine. 7. The heading of Item 11 of Appendix 1 Part B is "Printing Mach ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fect that slitter cum winding machine is internationally recognised as a paper cutting machine. Assuming that paper cutting machine in the instant case is a machine of general use in printing industry, even so, in the absence of any specific restriction to that effect it cannot be said that an industry other than paper industry cannot import this machine under OGL. 8. We, therefore, disagree with the conclusion of the Collector and hold that the import of the machine under OGL was permissible. 9. The declared invoice price was ₹ 15,94,044. The value determined under the impugned order is ₹ 22,59,181. If this be the correct value, it would follow in the circumstances of the case, that there was deliberate undervaluation. The Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble. That is clear from the circumstance that the two certificates of the same Chartered Engineers bearing the same date and showing different particulars regarding year of manufacture and value of new machine were procured by the appellant, one through the banking channel and other through ordinary channel. This must certainly be motivated. The Custom House has not succeeded in discovering the motivation behind this action. The department is not able to point out any provision of law by which such an action can be regarded as an offence on a violation of law. Therefore, the penalty levied cannot be sustained to any extent.
10. In the result, the impugned order is set aside and the appeals are allowed. X X X X Extracts X X X X X X X X Extracts X X X X
|
