Shri Narayan Kuria Vs. Commissioner of Customs, Kochi - Court Judgment

Excerpt:
1. the cod application granted as the delay as attributed to the death of the consultant who was engaged in the matter and the miscellaneous application granted; after hearing for sometime, it was felt that the matter could be disposed off finally since a bond has been executed at the time of provisional release of the car, further deposits were dispenses.the appellant was gainfully employed in owning a tailoring establishment in uae returned to india for permanent settlement, filed a bill of entry on 17.4.97 to clear a mercedes benz car imported alongwith registration booklet and vehicle export certificate issued by the traffic department umm-al-quwain and an affidavit. based on these declaration, the car was released on payment of duty. however, subsequent enquiries conducted revealed that this car with the subject chassis number had been sold by m/s. car trade, dubai vide invoice 1634 dt.31.12.96 to a pakistani national on 31.12.96 for a price of dhs 1,97,000/- which would indicate that the car was not in possession of the importer, the appellant herein on 31.12.96 therefore the particulars submitted at the time of clearance were not correct and the car was imported in violation of import trade control restrictions and was seized from the possession of one shri.k.v.ramana shetty of chennai even though the appellant had given a statement that he had purchased the car on 18.12.95 for dhs 1,11,000 from m/s.al araf general trading company at ajman, and was registered and even if he did not know driving or had a driving licence, the car shipped after his arrival should not be interdicted was not needed to and a scn alleging short levy on aspect of value, demanding differential duty and liability for confiscation under section 111 (d) (sic)was. the learned commissioner came to a conclusion that there were no grounds to come to enhance the assessable value and there was no case made out to charge duty and or interest (para 18 of the orderin-original). however based on the same invoice dt.31.12.96 of m/s.car trade, he came to a conclusion that the government registration books & certificates issued were "forged" and the car was imported in violation of public notice 3/97 and confiscated the same under section 111 (d) and imposed a penality of rs.3 lakhs on the appellant under section 112 (a).3. we have considered the submissions after hearing both sides, we find:- a) the description of the car in the two invoices in question as regards colour does not tally, moreover there is no material to come to a conclusion that the car registration book and other certificates issued by a government department are forged. the only reason as recorded is that the dri has obtained the invoice dt.31.12.96 and the investigation has been done with the help of indian embassy and many such instances of such imports availing the benefits of itc p.n.3/97 fraudulently have come to his custom house notice.b) we cannot appreciate the reasoning of the commissioner to rely on the invoice dt.31.12.96 of m/s.car trade for the purpose of jumping to a conclusion that documents of a public government office are "forged" and the invoice is gospel truth, when the evidence act prescribes otherwise; if the custom house has come across many such fraudulent imports what stopped the dri and the commissioner from getting this registration book to be got verified. the rejection of the invoice value of the invoice dt.31.12.96 of m/s.car trade and reliance on the earlier declaration of the value based on the earlier invoice of m/s.al araf general trading company at ajman and holding the assessment to be correct, though charged in the scn to be incorrect, leads one to conclude that the commissioner has been swayed by extraneous considerations and not the evidence on record. we therefore cannot uphold the confiscation and consequently the penalty. however, as pointed out by the learned d.r. that the invoice dt.31.12.96 bears the chassis number and the car could not been in use/possession of the appellant, we would set aside this order and remand the matter to the commissioner for re-adjudicating the itc angle, by obtaining such material as he can, to determine the authenticity of the registration book and other certificates, supply a copy of the same to the appellant, and thereafter adjudicate the matter afresh.c) the appellants will also be at liberty to place on record such material as they opt to prove use/possession of the car.

Judgment:
1. The COD application granted as the delay as attributed to the death of the Consultant who was engaged in the matter and the Miscellaneous application granted; after hearing for sometime, it was felt that the matter could be disposed off finally since a Bond has been executed at the time of provisional release of the car, further deposits were dispenses.

The appellant was gainfully employed in owning a Tailoring Establishment in UAE returned to India for permanent settlement, filed a Bill of Entry on 17.4.97 to clear a Mercedes Benz Car imported alongwith Registration Booklet and Vehicle Export Certificate issued by the Traffic Department Umm-Al-Quwain and an affidavit. Based on these declaration, the car was released on payment of duty. However, subsequent enquiries conducted revealed that this car with the subject chassis number had been sold by M/s. Car Trade, Dubai vide invoice 1634 dt.31.12.96 to a Pakistani National on 31.12.96 for a price of DHS 1,97,000/- which would indicate that the car was not in possession of the importer, the appellant herein on 31.12.96 therefore the particulars submitted at the time of clearance were not correct and the car was imported in violation of Import Trade Control Restrictions and was seized from the possession of one Shri.K.V.Ramana Shetty of Chennai even though the appellant had given a statement that he had purchased the car on 18.12.95 for DHS 1,11,000 from M/s.Al Araf General Trading Company at Ajman, and was registered and even if he did not know driving or had a driving licence, the car shipped after his arrival should not be interdicted was not needed to and a SCN alleging short levy on aspect of value, demanding differential duty and liability for confiscation under Section 111 (d) (SIC)was. The learned Commissioner came to a conclusion that there were no grounds to come to enhance the assessable value and there was no case made out to charge duty and or interest (Para 18 of the Orderin-Original). However based on the same invoice dt.31.12.96 of M/s.Car Trade, he came to a conclusion that the Government Registration Books & Certificates issued were "forged" and the car was imported in violation of Public Notice 3/97 and confiscated the same under Section 111 (d) and imposed a penality of Rs.3 lakhs on the appellant under Section 112 (a).

3. We have considered the submissions after hearing both sides, we find:- a) The description of the car in the two invoices in question as regards colour does not tally, moreover there is no material to come to a conclusion that the car Registration Book and other certificates issued by a Government Department are forged. The only reason as recorded is that the DRI has obtained the invoice dt.31.12.96 and the investigation has been done with the help of Indian Embassy and many such instances of such imports availing the benefits of ITC P.N.3/97 fraudulently have come to his Custom House Notice.

b) We cannot appreciate the reasoning of the Commissioner to rely on the Invoice dt.31.12.96 of M/s.Car Trade for the purpose of jumping to a conclusion that documents of a Public Government Office are "forged" and the invoice is Gospel truth, when the Evidence Act prescribes otherwise; if the Custom House has come across many such fraudulent imports what stopped the DRI and the Commissioner from getting this Registration Book to be got verified. The rejection of the invoice value of the invoice dt.31.12.96 of M/s.Car Trade and reliance on the earlier declaration of the value based on the earlier invoice of M/s.Al Araf General Trading Company at Ajman and holding the assessment to be correct, though charged in the SCN to be incorrect, leads one to conclude that the Commissioner has been swayed by extraneous considerations and not the evidence on record. We therefore cannot uphold the confiscation and consequently the penalty. However, as pointed out by the learned D.R. that the invoice dt.31.12.96 bears the Chassis number and the car could not been in use/possession of the appellant, we would set aside this order and remand the matter to the Commissioner for re-adjudicating the ITC angle, by obtaining such material as he can, to determine the authenticity of the Registration book and other certificates, supply a copy of the same to the appellant, and thereafter adjudicate the matter afresh.

c) the appellants will also be at liberty to place on record such material as they opt to prove use/possession of the car.