Valuation (Customs) — Undervaluation — Investigations revealing gross undervaluation through a fictitious invoice, revision of value by Customs 10% upwards whether sustainable ? (2) Redemption fine — Penalty — Increase in redemption fine and penalty whether justifiable ?
The Supreme Court Bench comprising Hon’ble Mr. Justice Syed
Shah Mohammad Quadri and Hon’ble Mr. Justice S.N. Variava on 18-2-2002 after
condoning the delay admitted the
Civil Appeal No. D963 of 2002 filed by U.K. Enterprises & Anr. against
CEGAT Order Nos. 392-395/2001-A, dated 6-11-2001 and reported in 2002 (140) E.L.T. 419 (Tri. - Del.) (U.K. Enterprises v. Commissioner). While admitting the appeal, the Supreme Court
passed the following order :-
“Delay
is condoned.
Appeal
is admitted. Pending further orders, there shall be an interim stay of the
enhanced penalty.”
The Appellate Tribunal in its impugned order had held that
investigations revealing undervaluation of goods entered in a fictitious
invoice of a Chinese party of Hong Kong to whom goods were never sent, revision
of value by Customs authorities adding 10% to the value of goods was
sustainable.
The Tribunal further held that when evasion was elaborately planned under a façade of shipment to a transit country and purchase therefrom on a fictitious invoice, considering the gravity of offence, increase in redemption fine from Rs. 2.5 lakhs to Rs. 10 lakhs and penalty on importer increased from Rs. 50,000 to Rs. 10 lakhs.
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