Indirect Tax

M/s Velpa Technologies Vs CC, Bangalore

Customs – Allegation of mis-classification and mis-declaration of quantity and value of imported ‘retro reflective sheets', ‘window films' – Statements recorded from GPA holder of proprietary firm (importer) under sec. 108 of Customs Act admitted manipulation of invoices in order to evade duty and were retracted only after issue of show cause notice – No material adduced to show that statements were recorded under coercion or threat, statements acceptable as evidence – In instances where inculpatory statements were retracted and corroborative evidence absent, such statements cannot be relied to justify allegation of mis-declaration of description, value, quantity of imported goods

Imports under B/E No. 436656 dt. 3/4/2003 – Chemical examination showed that part of the goods declared as self-adhesive paper were found to be plastic sheets with adhesive on one side, identified as NIKKALITE brand retro reflective sheet, classifiable under Chapter 3920.99 – Valuation of retro reflective sheet to be based on price admitted to have been paid to supplier by GPA Holder since statement was not retracted till filing of reply to show cause notice, which was issued eight months later – Duty liability to be re-quantified – Since mis-declaration of description and value of window films was accepted, in the absence of contemporaneous imports of identical goods, valuation based on statement made by GPA holder justified – Consignments covered by this B/E liable for confiscation under sec. 111(m) for mis-declarations

Imports under B/E No. 320634 – No evidence except retracted admission to show that goods were not adhesive paper but retro reflective sheets – When goods were examined by Customs and declaration accepted for assessment, and there is no reliable evidence that invoice covering this import was fabricated, finding of mis-declaration of description and value of imported goods covered by this B/E not justified, liable to be set aside

Import under B/E No. 394234 – Admission by GPA holder that invoice produced for assessment was fabricated – Valuation based on actual invoice recovered by authorities justified – Demand of differential duty and confiscation upheld

Import under B/E No. 416047 – Allegation of undervaluation of hair dryers and payments to supplier not supported by any reliable evidence – Witness not produced for cross-examination – Findings regarding undervaluation and consequential demand of differential duty and confiscation of goods not justified, liable to be set aside

Import under Airway Bill No. 058 4036 4973 – Confiscation ordered by original authority under sec. 111(f) sustained since under this provision any dutiable or prohibited goods required to be mentioned under the regulations in an import manifest or import report, which are not so mentioned, are liable to confiscation

Demand of duty from importer and imposition of penalty on importer as well as GPA holder upheld – Duty and penalty to be re-quantified by original authority on remand : BANGALORE CESTAT;