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TMI Blog2025 (5) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1962 and imposed penalty of Rs. 2,00,000/- on the appellant under Section 112(a) of the Customs Act, 1962. An appeal was filed by the appellant with the Commissioner (Appeals) and the Commissioner (Appeals) after taking the note of the fact that the present consignment was replacement part of earlier supplied equipment supplied free of charge to the appellant, that originally the value declared was USD 29,150 which was accepted and assessed to duty by the authorities concerned, he upheld the order of the original authority but reduced the penalty to Rs.1,00,000/-. Further, based on the request made by the appellant, the goods were allowed to be reexported after payment of all charges. Aggrieved by this order, the present appeal is filed before this Tribunal. 3. The learned Counsel for the appellant submitted that the impugned goods imported under Bill of Entry No. 208049 dated 28.08.2009 is a replacement of goods which was imported earlier and found to be defective. Originally the consignment was imported and the invoice dated 30.06.2009 valued at USD 29,150 was accepted by the department. It is further stated that the original importation was supplied in terms of the price l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f charge, the question of redetermination of value does not arise. Moreover, though the show-cause notice observes that similar items supplied by the same supplier was imported by another importer HCL Technology Ltd., Chennai vide bill of entry No. 788183 dated 16.02.2009 for an unit valued at USD 50,600, the Original Authority rejected the declared value USD 26,400 on the impugned goods and re-determined the value based on the supplier's list priced at USD 1,10,000 for the purpose of assessment under Customs Act, 1962. He further observed that the appellant placed on record certification provided by M/s. Cisco, the supplier called as "Cisco Gold Certified System Integrated Partner" based on which the appellant had claimed 76% discount on the list price. However, rejects their claim on the ground that no documentary evidences were placed on record where such satisfied clients were eligible for large discounts. But, it is also the fact that the similar items was imported by M/s. HCL Ltd. without any certification at USD 50,600, therefore, redetermination of value based on the supplier's list price without any sufficient reasons cannot be sustained. Moreover, when the appellant had r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess than the value of the goods adjudicated by the authorities. Though the petitioner had declared the value at Rs. 4,34,835/-, according to the Department, it was Rs. 6,24,997/-. It is baffling that the goods were sold for Rs. 2,78,000/-. On 2-8-1999, Joint Commissioner had fixed the price at Rs. 6,24,887/- as against the declared value of Rs. 4,34,835/ -. That being so, disposal of goods for Rs. 2,78,000/- on 7-8-1999 appears to be somewhat queer and mysterious. Be that as it may, once the petitioner had deposited the duty, redemption fine and penalty, it was entitled to release of the goods. Here again there is some confusion. According to the respondent, the petitioner was asked to take the goods from three consumer co-operative stores and it did not do so. In answer to this stand of the respondent, the petitioner has filed several letters to show that the goods which were supposed to be with three co-operative societies were not in a fit state to be taken back. 6. Sections 23(2) and 150 of the Act on which great emphasis is laid by the counsel for the respondent read as under :- Section 23. Remission of duty on lost, destroyed or abandoned goods. (1) ............. "(2) T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... visions of the Act. Even this provision postulates a notice to the owner before action is taken. That has also undisputedly been not done. As prescribed in sub-section (1) of Section 150 it relates to conditions of sale and procedure thereof in respect of confiscated goods which are to be sold by public auction or tender or by consent of the owner. That is not the fact situation in the present case. The petitioner had deposited the redemption fine, duty and penalty. If it was the stand of the respondent that it was a case of under-valuation then there was no question of returning the redemption fine, duty already paid as indicated above. 8. In the aforesaid background, petitioner is entitled to receive the value of the goods as fixed by the Department i.e. Rs. 6,44,997/- and at the same time it is liable to pay redemption fine and duty which amount to Rs. 3,80,000/-. Penalty of Rs. 50,000/- has already been paid. Therefore, the Customs Authority shall return to the petitioner a sum of Rs. 2,64,997/- (i.e. the difference between Rs. 6,44,997/- and Rs. 3,80,000/-). The amount shall be remitted to the petitioner within a period of six weeks form today". 8. This Tribunal in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods as fixed by the department when the goods have been auctioned / sold by the department without notice at much lesser price than the one declared by the assessee and much less than the value of the goods adjudicated by the authorities. This decision of the Tribunal has been upheld by the Hon'ble apex court in Shilp Impex vs. UOI: 2002 (140) ELT 3 (SC). Further, in the case of CCE, Allahabad vs. Pidilite Industries Ltd.: 2007 (212) ELT 38 (Tri. - Del.), the Tribunal set aside the order of confiscation of the seized goods without issuing the notice to the assessee. The said decision of the Tribunal was upheld by the High Court of Allahabad as reported in 2014 (309) ELT 598 (All.) wherein in para 6 and 7, the Hon'ble High Court has held as under: "6. It may be mentioned that Hon'ble Supreme Court in the case of Northern Plastics Ltd. v. Collector of Customs & Central Excise - 1999 (113) E.L.T. 3 (S.C.) as well as in the case of Shilp Impex v. U.O.I. - 2002 (140) E.L.T. 3 (S.C.) held that during the pendency of the appeal confiscated goods could not have been auctioned without prior permission of the appellate court. 7. In the instant case, the matter was sub judice b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation of the Commissioner of Customs is to be accepted then there would be no necessity to have an elaborate judicial system. Such a view of the Commissioner is also subversive of the judicial system. Once the absolute confiscation ordered by the adjudicating authority has been set aside by the Commissioner (Appeals) and when the Commissioner (Appeals) order has become final the Commissioner of Customs, Bangalore cannot hold that the absolute confiscation was in accordance with the law. We would like to reiterate that in this case the order of the Commissioner (Appeals) only has reached finality and not that of the Additional Commissioner. 9. In the Kailash Ribbon Factory Ltd. case (referred supra), the Hon'ble Delhi High Court held that it is a serious lapse on the part of the department when it auctioned confiscated goods without permission of the Tribunal during pendency of the appeal without even giving notice to the appellants. It was held that the department has to refund the declared value of the goods with interest per annum from the date of auction of the goods. 10. In the Spring RPG India Ltd. case, while passing strictures against the Customs Department, the Del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of Rs. 1,29,478/- (Rs. 5,39,578/- - Rs. 4,10,000/-). Strange are the ways of bureaucracy. It appears that the remedy is worse than the disease. 15. In view of our observations, we hold that the ratio of all the above-mentioned cases is squarely applicable to the present case. It is very clear that the department has sold the goods on the understanding that the first order of the original authority is the final order. In other words when the appeal was pending the car has been sold without informing the petitioner and also the Commissioner (Appeals). Hence the appellant is entitled for the full mahazar value of the car. Since the goods were not released to the appellant as per the order in appeal neither the duty nor the penalty is chargeable from the appellant, as the goods have disappeared for no fault of the Appellant. Hence, we order payment of Mahazar value and interest @ 12% p.a., from the date of auction. As regards the penalty deposited, the same is liable to be refunded in view of the ratio laid down by Hon'ble Supreme Court in the Shilps Impex case. The impugned order is set aside and appeal allowed on the above terms". 9. In view of the above, we allow the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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