COMMISSIONER OF CUSTOMS, KOLKATA versus M/S. PEERLESS CONSULTANCY SERVICES PVT. LTD.

Citation: [2007] 7 S.C.R. 783 · Decided: 24-05-2007 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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COMMISSIONER OF CUSTOMS, KOLKA TA
A'
v.
MIS. PEERLESS CONSULTANCY SERVICES PVT. LTD.
MAY24, 2007
[DR. ARIJIT PASA Y AT AND LOKESHWAR SINGH PANT A, JJ.]
B
Customs Act, 1962:
S. I I 3 (d) and I I 4-E.xport under Duty Entitlement Pass Book Scheme-
Assessee exporting steel balls and making a claim under the Scheme- C
Revenue alleging subject goods grossly over invoiced and declared FOB and
PMV to be highly inflated to avail higher DEPB credit-Show Cause Notice
to assessee-Demand confirmed by Commissioner-Tribunal setting aside
order of Commissioner-Held: Tribunal set aside the order of Commissioner
without discussing as to how his conclusions were erroneous-Matter remitted D
to CESTAT for adjudication afresh-Foreign Trade (Regulation) Rules, 1993-
r. I/.
Respondent company, which was engaged in the busim:ss of computerized
printing, exported for the first tim1 'Onsignments of steel balls of a total
declared value of Rs. 14.63 crores um
Duf· Entitlement Pass Book (DEPB) E
Scheme. The Revenue found that the ,1• 1jcct _;oods were grossly over invoiced
in order to avail higher DEPB credit. Accordingly, a show cause notice was
issued to the respondent company for gross mis-declaration of material facts
and the value of the steel balls and willful misstatement and suppression, and
violation ofs.113(d) of the Customs Act, 1962 read with Rule 11 of Foreign F
Trade (Regulation) Rules, 1993 as also for penal action under s. t 14 of the
Customs Act The Commissioner confirmed the demand. However, the CEGAT
allowed the appeal of the assessee and set aside the order.
In the appeal filed by the Revenue it was contended that the Tribunal
failed to note that the findings recorded by the Commissioner were based on
the evidence tendered by the company indicating that there was a mis-
declaration and misstatement only with the object to boost the value to get
higher DEPB benefit. It was submitted that the Tribunal, did not give any
reason for setting aside the elaborate order passed by the Commissioner.
783
G
H
784
SUPREME COURT REPORTS
(20()7) 7 S.C.R.
,,,-
A
Allowing the appeal and remitting the-matter to the CEST ~ T, the CoUrt
~
j__
HELD: The Commissioner had in detail referred to various aspects to
conclude about o~er-invoicing. The applicability of Circular No.69/97 would
depend upon the factual scenario of a particular case. What the Tribunal
B
appears to have done is to_refer to the arguments of parties and then came to
abrupt conclusions without discussing in detail as to how the conclusions of
the Commissioner were erroneous. That having not been done the order is
vulnerable. Accordingly, the order of the Tribunal is set aside. The CEST AT
would adjudicate the matter afresh. f Para 19 and 201 f790-B, CJ
)-
c
Commissioner of Custom, New Custom House, Mumbai v. Vishal Exports
Overseas ltd., (2007)9309 ELT 331 SC, cited
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 5415-5417 of
2002.
From the Final Judgment and Order No. A-141-143 dated-1-1.02.1002 of
'
D the Customs, Excise _& Gold (Control) Appellate Tribunal, EZB Kolkatta in
Appeals No. C/R-292-294/200 I.
P. Vishwanath Shetty, Sr. Adv., G. Umapathy, S.J. Aristotle and B. Krishna
Prasad, Advs. with him for the Appellant.
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-
E
S.K. Bagaria, Sr. Adv:, Sanjay Ghosh, Ms. Anitha Shenoy, Saurabh
Suman Sinha, Piyush Kumar and Navneet Panwar for the Respondent.
The Judgment of the Court was delivered by:
F
DR. ARIJIT PASA Y AT, J. I. Challenge in these appeals is to the orders
passed by the Customs _excise and Gold (Control) Appellate Tribunal, EZB
Kolkata (in short the 'CEGAT') allowing the appeals filed by the respondent
y
holding tha! the guidelines contained in circular No. 69/97-CUS dated 8.12.1997
issued by the Government of India, Ministry of Finance, Department of
Revenue, New Delhi, as it has not succeeded in making out a case against
G respondent as the Present Market Value (in short the 'PMV') declared is not
more than 150% of the AR 4 value. Accordingly the order passed by the
Commissioner of Customs (Post) Kolkatta was set aside.
2. Background facts in a nutshell are as follows:
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3. The Respondent Company which is engaged in the business of
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COMMNR. OF CUSTOMS. KOi.KATA v. PEERLESSCONS'ULT ANCY SERVICES PVT. LTD. (PASAV AT. J. ) 785
....\
computerized printing exported for the first time consignments of steel balls A
ofa total declared value afRs.14.63 crores to one Mis. Ria Multiple

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