Order Date – 21 March 2023

Parties - M/s Karan International Vs Commissioner of Customs (Port), Kolkata

Facts –

• The appellant, M/s Karan International, imported two consignments of Enamelled Aluminum Wire while, one import was effected from M/s Gaungdong Metal & Minerals Import & Export Group Corporation, China dated 16.08.2008, second shipment was imported from Balaji Exports, Hongkong vide dated 17.08.2008.
• After the visual examination the department claimed that the imported goods were Enamelled Copper Clad Aluminium Wires.
• The Ld.Commissioner vide impugned orders has enhanced the value of the imported goods and demanding payment of differential duty confiscating the said goods under Section 111 (m) of the Customs Act, 1962, releasing them on redemption fine under Section 125 of the Customs Act, 1962 and also imposing penalty on the importer under Section 112 (a) of the Customs Act, 1962.
• Show-cause notice dated 08.12.2008 was issued by the Department imputing that the classification claimed by the importer was inappropriate and the imported goods were properly classified under Chapter Tariff Heading 8544 attracting Adv. Rate of duty at 7.5% and not 5%. Show-cause notice also proposed to enhance the value of the imported goods from US$ 1.9 per Kg. to US$ 8.40 per Kg

Issue –

• Whether the goods imported by the Appellate were undervalued and the penalty imposed by the impugned order justified?

Order – 

• The Tribunal observed that the impugned orders passed by the ld.Commissioner suffer from legal infirmity inasmuch as the comparison offered based on NIDB Data is with reference to an altogether different product viz. Braiding Wire of Aluminium Alloy and therefore, it certainly cannot be considered as identical or similar goods, viz. Enamelled Aluminum Wire.
• Further, it found that in view of the manufacturers certification provided at the time of import and with no claim to doubt the veracity of the said contention, the test results as offered by the CRCL and the Sriram Institute for Industrial Research, New Delhi, the Department’s claim of disputing the description and valuation of the import goods is bereft of any merit.
• In addition it stated that the comparisons offered of allegedly similar goods either by way of proforma invoice of NIDB data are also without any merits as they cannot stand legal scrutiny.
• Following the law laid down by the Hon’ble Supreme Court in the case of CCE & S.Tax, Noida Vs. Sanjivani Non-Ferrous Trading Pvt. Limited and in view of their deliberations the Tribunal set aside both the impugned orders herein and allow the two appeals with consequential relief, if any.