TMI Blog2005 (2) TMI 290X X X X Extracts X X X X X X X X Extracts X X X X ..... process of leaving what one calls 'Customs area'. The CIU got wind of it and pounced on the hapless importer, got the consignment unloaded and examined it all over again. Much to the chagrin of the importers and to the joy of the CIU, it was found that 84 bales out of the imported goods contained garments and the rest (9 bales and 20 gunny bags) mutilated woollen rags. The consignment was seized not only for misdeclaration but also for import without a valid licence. Those days only pre-mutilated garments could be imported without a licence. 2.Investigation revealed that the importer in connivance with the CHA and the dock examining officers perpetuated a fraud. Proceedings were initiated against the importer and the CHA and his staff und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not choose to clear the goods as thought by the Commissioner. Instead they filed a refund claim for duty paid by them initially, as the goods on which duty was paid were destroyed in the custody of the Customs Department. We may recall that the goods were seized of CIU after the out of charge was given but before the goods left the customs area. This refund claim was rejected by the lower authorities. In appeal the Tribunal vide its order held that refund is admissible quote "the customs authorities failed to deliver the goods to the appellants they must refund the duty which has been collected illegally". In pursuance of this decision, we are told, the importer got the refund of duty paid initially. The rights and wrongs of the order is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he importer cannot be held responsible for the action of exporters in another country; that the goods in question were not valued in accordance with the provisions of Valuation Rules; Transaction value can be rejected only when the conditions stipulated in Rule 4 of Valuation Rules are satisfied and that the Commissioner should have determined the value under Rule 8 only after sequentially ruling out the Valuation Rules 5 to 7. He cited case law in support of his contentions. 7.We have examined the various contentions. There is no gainsaying the fact that 84 bales out of 102 bales of imported goods consisted of non-mutilated garments. We reject the contention that there is no misdeclaration of goods on the part of the importer. The argume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on the destroyed goods no penalty should have been imposed we observe that the act of importation of contraband goods was complete before the alleged fire occurred destroying the goods. A subsequent event like this cannot determine the consfiscability or otherwise of the goods themselves. The importer brought goods into India in contravention of import policy. They are therefore liable to confiscation. In regard to the contention that penalty should not have been imposed on the firm and its partner we observe that there is no such bar. The firm as an importer has an identity of its own. The partner as a person who has masterminded the whole operation can be saddled with a penalty. 9.We hold that the goods are liable to confiscation and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducted of only those packages in which rags were packed was conducted clearly shows that the CHA was aware of the misdeclaration. Penalty imposed on the CHA firm is sustainable. In regard to the penalty imposed on the partner of the CHA firm we hold evidence as brought out is not sufficient to impose penalty particularly when the officers who examined the goods were not proceeded against under the Customs Act. And so is the case with the employees of the CHA firm. Penalties on them are not sustainable. 13.We therefore reject the appeals of the CHA firm. We however allow the appeals of the partner and employees of the CHA firm. 14.Having regard to the fact that the goods are destroyed in fire and have not actually been consumed in the DT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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