TaxTMI 
TaxTMI 
1983 (8) TMI 56
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....rst consignment of 164 cases arrived on March 11, 1973 and in respect of that consignment, the Collector of Customs, Bombay served show cause notice on July 7, 1973 upon the petitioners to show cause why the goods should not be confiscated on the ground of value mis-statement. The value mentioned in the bill of entry was £ 0.15 per kg. and the Collector felt that the price was absurdly low as the quotation received by the Customs authorities indicate the prevailing price of £ 0.430 per kg. The second consignment of 164 cases arrived in May 1973 and in respect of this consignment also a show cause notice was issued on July 7, 1973 as to why the goods should not be confiscated for mis-declaration of value. The third consignment of 164 cases containing 8,030 kgs. of lead glass tubing arrived in November 1973 and the Bill of Entry was filed by the petitioners on November 9, 1973 for 8,030 kgs. claiming value at £ 0.25 per kg. The show cause notice in respect of third consignment was served on the petitioners on November 19, 1973 for mis-declaration of value and also for mis-declaration of weight in the Bill of Entry as the goods imported were 10,037 kgs. instead of 8,030 kgs. as dec....
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....was in error in upholding the amount of penalty levied on the ground of mis-declaration of weight in respect of the third consignment. In regard to the first ground, the petitioners have declared the value of the imported goods at the rate of £ 0.15 per kg. in respect of the first two consignments and £ 0.25 per kg. in respect of the third consignment. Shri Talyarkhan submits that the price declared by the petitioners was proper and the conclusion of the authorities that the price was £ 0.430 per kg. is without any basis. Before adverting to the submission of the learned Counsel, it would be appropriate to make reference to Section 14 of the Customs Act, 1962. Section 14 of the Customs Act provides that for the purposes of the Act whereunder a duty of customs is chargeable on any goods by reference to their value, the value of such goods shall be deemed to be — "(a) the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade, where the seller and the buyer have no interest in the business of each other and the price is the sole conside....
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....ns to record a conclusion that the petitioners have under-valued the goods which they have imported under the three consignments. Shri Talyarkhan submits that the authorities were in error in relying upon these two quotations because the authorities declined to disclose the names of the parties or the intending importers to whom the quotations were sent by M/s. Chance Brothers Limited and John S. Elmore Limited. The learned Counsel submitted that unless the names of the intending importers are disclosed to the petitioners and they are offered for cross-examination, it is not possible for the petitioners to establish that the price quoted in the two quotations was not just price. 7. Shri Mehta, learned Counsel appearing on behalf of the Department, points out that the copies of the letters containing the price offered were handed over to the petitioners with a slip pasted on the name of the intending importer and that was done with a purpose, because the disclosure of the name of the intending importer may lead to several complications. The Department would not be able to collect such evidence if the name of the intending importer to whom the quotations are addressed are disclosed ....
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....yarkhan made reference is the certificate issued by M/s. Chance Brothers Limited on November 7, 1973 confirming that the price was £ 0.340 per kg. in May 1973. The next document relied upon is the letter dated September 20, 1974 from M/s. Chance Brothers Limited to the petitioners offering the price at £ 0.340 per kg. These letters and the certificate were relied upon by the learned Counsel to claim that the quotation value of £ 0.430 per kg. relied upon by the authorities was not accurate. There is no merit whatsoever in this contention. Each and every document on which reliance is placed had come into existence after the order was passed by the Collector on August 7, 1973 in respect of the first two consignments. After the Collector recorded the conclusion that the value shown by the petitioners in the Bills of Entries was grossly inadequate. The petitioners and manoeuvred to secure the letters from the exporters to substantiate their claim. This clearly indicates that the petitioners were willing to produce false evidence before the authorities to sustain their claim. If the authorities below have ignored this false evidence, then no infirmity can be found in that conclusion.....
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....lty for mis-declaration of weight of the imported goods. Shri Talyarkhan submits that the Collector and Appellate authority had not recorded any finding in respect of the mis-declaration of weight by the petitioners. It was urged that the petitioners have given explanation about the mistake in declaration of the weight of the goods and as the Collector and the Appellate authority had not recorded specific finding rejecting the explanation, it should be held that the explanation was accepted. The explanation was that the declaration of weight was made by mistake which occurred in view of the shipping documents sent by the exporter. The petitioners claimed that it was not made wilfully or deliberately. It is undoubtedly true that the Collector in his order has not specifically found that the explanation is not acceptable but there is hardly any doubt that he was not inclined to accept the explanation because he had levied a penalty of Rs. 27,000 for mis-declaration of the weight of the imported goods. That order was confirmed by the appellate authority and the revisional authority found that the levy of penalty was justified and, in these circumstances, it is not possible to accept t....
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.... was not because of a valid mistake but was deliberate to avoid the duty. The submission of Shri Talyarkhan that the Collector and the Appellate authority had not considered this aspect is not accurate because the order of the Collector specifically refers to the penalty for mis-declaration of weight and the challenge levied by the appellant to this aspect was present before the Appellate authority while hearing the appeal as the appeal Memo itself includes a ground in this regard. 11. Shri Talyarkhan then submitted that even assuming that the petitioners have made a mis-declaration in respect of the weight of their consignment as such mis-declaration was not done mala fide but out of a bona fide mistake, the authorities were not justified in imposing a penalty. In respect of this submission, reliance was placed on the decision in the case of M/s. Hindustan Steel Ltd. v. The State of Orissa reported in A.I.R. 1970 Supreme Court 253 = 1978 E.L.T. (J 159). In paragraph 7 of the judgment, the Supreme Court while considering the validity of the penalty imposed under the provisions of the Orissa Tax Act observed that the liability to pay the penalty does not arise merely upon pro....