By TIOL News Service

MUMBAI, MAR 27, 2019: THE appellants have filed a Bill of Entry for import/ clearance of Computer Parts, Memory Modules. Since the description of goods on the bill of Entry was found to be vague/ inadequate and a large quantity of obsolete goods (2 GB DDR2 Hynix Memory Module) was imported by importer, the goods were detained and taken up for 100% examination. On examination, the goods were found to be grossly misdeclared in terms of description (brand/ make/ model), quantity and value. Also some items (Intel Microprocessors) in the consignment were found to be old and used. Accordingly, the goods were seized under a seizure memo under section 110 (1) of Customs Act, 1962, as these goods were liable for confiscation under Section 111 for contravention of section 46.

Appellants vide their letter inter alia admitted that the goods have been mis-sent by their shipper in Dubai and the shipper has requested for the recall of goods. Accordingly they requested for the permission to reexport the goods. However appellants have submitted that since the goods were mis-sent by the shipper they were not aware of the goods that were shipped and hence they should not be held responsible for the misdeclaration.

From the statement of Shri Sunil Jain, Director of Appellant, it can be reasonably concluded that the goods in the consignment under importation are not the goods as declared by appellants.

The submissions made by appellant do not inspire confidence as in the present case the date of invoice is 12.02.2018 and MAWB is 6.02.2018, whereas as per the appellants the date of purchase order is 12.02.2018. It is the submission of appellants that "Master Air Waybill is issued by the carrier airline after the receipt of goods on the basis of declaration made by the shipper of the goods or the forwarder of the goods on behalf of shipper." There seem to be no explanation about the fact that MAWB is prior to the dated of purchase order or invoice. Even though appellants submit that these goods were meant for certain party in Dubai and were mis-sent by shipper to them against their purchase order dated 12.02.2018, cannot be correct because the Master Airway Bill predates the purchase order. Merely on the ground that the department did not serve a communication to the importer after detention but before the receipt of the request for re-export, it cannot be said proved that the importer was ignorant of the fact of detention. It sounds too much of coincidence that the email from the supplier was also received after the detention of goods and not before it. The fact of the matter is that the importer had filed a Bill of Entry and it was the duty/ liability of the importer to declare the contents of the consignment correctly in the Bill of Entry and the importer can certainly not take refuge in the amendment of Customs Act (amendment of Section 46 which mandates filing of Bill of Entry within prescribed time or else pecuniary penalty on account of delay) to justify mis declaration. It sounds to be too much of a coincidence that despite the contention of the importer regarding wrong good having been shipped, the weight of the consignment is exactly equal to the declared weight. Hence, the goods were misdeclared in terms of description, quantity and value.

By mis-declaring the goods, appellants have sought to clear certain goods which were old and used. The clearance of such old and used goods for home consumption in India is not permitted under Export Import policy 2015-20 (Para 2.31 read with Notification No 35 (RE-2012)/2009-14 dated 28.02.2013), without proper authorization from Director General Foreign Trade.

Accordingly the charge of mis declaration of the consignment in terms of description, quantity and value is well founded.

The CESTAT, therefore, observed that,

++ there is no merit in the submission of appellants that the goods were wrongly shipped by the shipper. In fact, these goods were sought to be imported into India contrary to the EXIM Policy restriction and also by grossly undervaluing the same.

++ no merit in the submission of appellants with regards to bonafides, which in any case is not established in this case. Hence the decisions of Tribunal relied upon by the appellants are clearly distinguishable.

++ since the Appellant Company and its Director have by their acts of omission and commission have rendered the goods liable for confiscation, penalty imposed on them under Section 112 is justified.

Taking into account the re-determined value of consignment and the fact that some of the goods sought to be imported were old and used thus restricted under the EXIM Policy, the quantum of penalty too is quite reasonable. No merit found in the appeals filed by the appellant company or its Director and hence the same is dismissed.

(See 2019-TIOL-868-CESTAT-MUM)