ORDER
P.C. Jain, Member (T)
1. First appeal was originally filed as a revision application against the order of Appellate Collector of Customs, Calcutta and now stands transferred to this Tribunal in terms of the provisions of Section 131-B of the Customs Act. The second appeal Is against the order-ln-appeal passed by the Central Board of Excise and Customs. Since both these appeals arise out of the same set of facts, a common order is being passed.
2. Before we set out the facts in the two subject appeals a miscellaneous application was filed by the department to bring on record certain documents and hearing was given for bringing those documents on record as prayed for by the department and as opposed by the appellant herein. Miscellaneous application had been heard on 19-10-1987 and orders were reserved on the miscellaneous application directing the parties concerned to advance their arguments in the cases keeping in view the order on miscellaneous application being delivered either way. After hearing the both sides and the decision that is proposed to be taken on the appeals, we do not consider it necessary to pronounce a separate order on the miscellaneous application because we feel that both the appeals can be decided without considering the additional evidence sought to be brought on record by the respondent-Collector. Accordingly, no orders are being passed on the miscellaneous application.
3. Brief facts in the two appeals are as follows :-
(1) The appellant company herein filed a bill of entry in this Custom House on 6-8-1976 through their authorised Custom House agents M/s. Express Clearing Agency for clearance of 7 vacuvators with accessories imported per s.s. Lok Shevak, Rot No. C88/76. The bill of entry was signed by Commander K. Cheiliah, Chairman and Managing Director of the appellant comapny as importer.
(2) In the bill of entry the C.I.F. and assessable values of the subject goods were declared to be Rs. 17,929.00 and Rs. 18,144.00 respectively. From the declaration signed by the importer on the reverse of the bill of entry (page 133 of the paper book relating to 1st appeal number filed by the appellant) it is indicated that a certificate dated 6-7-1976 of M/s. Dunbar Kapple Inc. was enclosed with the bill of entry. The said certificate/invoice from the said M/s. Dunbar Kapple Inc. is not available now.
(3) While assessing the subject goods to duty, the following observations and suggestions were made by the concerned Appraiser on 13-8-1976 In Custom House file No. S6(Gr.V)-1/76A.
“It is seen from the documents filed by the party that the above mentioned 7 vacuvators were purchased by the importers from the Captain of the Mother Tanker ‘Kapetan Markos’ at Sagar and landed into the coastal vessel m.v. ‘Lok Shevak’. There is therefore, no invoice for the goods. There is however certificate from the Master of the ‘Kapetan Karkos’ that the subject goods were sold for $ 2000.00 and the rupee equivalent amounting to Rs. 17.920/- has been received by him. There is also a certificate from the manufacturer to the effect that the value of the whole equipment is Rs. 17.920/-
The goods consists of 7 vacuvators with various accessories leviable to separate rates of duty. The party is unable to explain which items are with main equipment and which items are accessories and spares. Further, they are unable to furnish separate values. In this connection their letter dated 12-8-1976 may kindly be seen.
The importer is a Govt. of India undertaking, in view of what has been stated above, the value declared by the party may be accepted and the goods assessed at the highest rate as per provisions under Section 19 of Customs Act, 1962. The goods are covered by a valid C.C.P.”
(4) The above suggestions of the Appraiser concerned were approved by the Assistant Collector of Customs and subject goods were assessed to duty under the Heading 84.62(2) of the Customs Tariff Act on the declared assessable value of Rs. 18,144.00 at the rate of 100%/20% auxiliary duty/15% countervailing duty. A total amount of Rs. 27,760.32 was deposited in the Custom House Treasury by M/s. C.I.W.T.C. Ltd., Calcutta under cash No. 1-25 of 1.9.1976. Thereupon, the subject goods were passed out of Customs control on 2.9.1976.
(5) Fifth Report of the Parliamentary Committee on Public Undertakings made the following observations :-
‘The payment of the cost of vacuvators amounting to Rs. 32 lakhs in dollars was made in U.S.A. No approval of the Reserve Bank of India was obtained therefor and it would appear to amount to violation to Foreign Exchange Regulation Act. The payment of Customs duty has also been evaded as the value declared to the Customs was only $ 2000 which was not correct.”
On receipt of the extract of the above Report further investigations were carried out by the Custom House Calcutta. Shri H. Ghosh of the appellant company by his letter dated 12.7.1978 informed the Custom House that the relevant papers and files had already been taken over by the CBI and hence no information could be furnished at that stage. Shri Ghosh further informed that as far as they could recollect 7 vacuvators were purchased by them from Captain of vessel ‘Kapetan Markos’ on payment of Rs. 17.920/- (equivalent to U.S.$ 2.000/-) made through their agent M/s. M.M.P. Lines Ltd. as per agreement dated 4.2.1976. A copy of the said agreement was also sent by Mr. Ghosh alongwith the said letter. This agreement was entered into between M/s. Vencedora Oceaonic Nariera S.A., the owners of the vessel ‘Kapetan Markos’ (hereinafter referred to as Vencedora) and the appellant company herein on 4.2.1976 at New York. The agreement was to the effect that on completion of lightering Kapetan Markos at or off Calcutta the owner of the said vessel Vencedora of Panama will sell the seven vacuvators and all accessories used to lighter the Kapetan Markos vessel to the appellant company in consideration of payment of a lump sum of U.S. $ 2000 payable in non-remittable in Indian rupees and the delivery of the vacuvators and accessories to be effected “as is where is” basis on board m.v. Kapetan Markos with the appellant company being responsible to remove the same at their risk, time and expenses. On behalf of the appellant company the agreement was signed by Commander K. Chelliah.
(6) The documents taken over by the CBI, G.O.W. Calcutta from the appellant company were also inspected by the officers of the Custom House. Scrutiny of those documents further revealed the following information :-
(a) Quotation No. 02978 dated 14.1.1976 of M/s. Dunbar Kapple Inc., Illinois, U.S.A. to M/s. C.I.W.T.C. Ltd., Calcutta (the appellant company herein) for 7 vacuvators, spares and accessories was obtained from M/s. Eastern Equipments and Sales Ltd., agents of the said M/s. Dunbar Kapple Inc. Indicated an ex-factory price of the aforesaid goods to be U.S. $ 2,64,029.28.
(b) Commander K. Chelliah carried on negotiations with M/s. Vencedora Oceanic Naviara S.A. for stevedoring contract for the discharge of about 62,000 tons of grain which was to be loaded at Seattle in February, 1976 at or off the port of Calcutta from the holds of the Mother Tanker m.v. ‘Kapetan Markos’ into smaller vessels for lightering purposes.
(c) While carrying on the aforesaid negotiations, the appellant company approached the Ministry of Shipping and Transport to arrange for sanction of foreign exchange worth U.S. $ 3.75 lakhs for importing 7 vacuvators alongwith spares and accessories; they also approached the D.G.T.O., New Delhi for giving clearance from indigenous angle to allow the import of 7 vacuvators.
(d) DGTD New Delhi did not give the clearance from indigenous angle for the import of vacuvators and advised the appellant company to contact M/s. S.N.L Maneklal Industries Ltd., Ahmedabad for their requirements.
(e) M/s. Inter-Ocean Shipping Co., New Delhi acting as brokers in the transactions between the appellant company and M/s. Vencedora Oceanic Naviara S.A. informed the former that in view of the former’s difficulty in obtaining suitable and efficient discharging equipment they were prepared to discuss with M/s. Vencedora Oceanic Naviara S.A. the details of providing first class vacuvators in order to facilitate the operation and that it was understood that the rates and payment terms shall have to be negotiated under the revised conditions.
(f) On 16.1.1976 the appellant company informed the Ministry of Shipping and Transport, New Delhi that the owners of ‘Kapetan Markos’ were insisting that the contract for the discharge of grain would be awarded to the appellant company subject to the said company using vacuvators of reputed American manufacturers, namely Dunbar Kapple Illinois, U.S.A. They further informed the Ministry that M/s. Vencedora Oceanic Naviara S.A. were prepared to hand over the vacuvators on successful completion of the operation by the appellant company at a nominal cost of U.S. $ 2.000.00 payable in non-remittable Indian currency. The Ministry was further informed that the previous request seeking permission to import vacuvators and release of foreign exchange (worth U.S. $ 3.75 lakhs) by the Government for the purpose might be treated as cancelled.
(g) On 19.1.1976 the Ministry of Transport gave approval to the aforesaid proposal of the appellant company for acquiring 7 vacuvators at a nominal cost of U.S. $ 2,000.00.
(h) On 21.1.1976 M/s. Inter-Ocean Shipping Co., New Delhi informed the Chairman-Managing Director (CMD) Commander Chelliah that the owners of ‘Kapetan Markos’ desired to meet him in London on 29.1.1976 to negotiate and finalise the terms of contract.
(i) On 24.1.1987 Commander Chelliah informed some officers of the appellant company from London that contract with owners of ‘Kapetan Markos’ was finalised and that he was proceeding to New York.
(j) On 4.2.1976 the appellant company entered into a bailment agreement with Vencedora regarding the vacuvators. This agreement stipulates, inter alia, that Vencedora in order to facilitate C.I.W.T.C. Ltd. (the appellant company herein) would advance U.S.$ 1,00,000 to Dunbar Kapple Inc. and would further provide Dunbar Kapple Inc. with a letter of credit by 9th Feb. 1976 upto the sum of $ 194,000; thus covering the cost of 7 vacuvators, spares and accessories as per Dunbar Kapple Inc. quotation dated 14.1.1976 and related inland freight and transportation charges including inland all risk insurance from Batavia Illinois to Seattle Washington. The agreement further stipulated that Vencedora Oceanic Naviara will on account of CIWTC arrange for the loading, stowing, securing and lashing of the vacuvators on board the Kapeten Markos in Seattle Washington, all costs for this operation would be for CIWTC account. It was further agreed that CIWTC would pay to Vencedora a concessional lump sum ocean freight to the tune of U.S.$ 20,000 for transporting the vacuvators to India. Further Vencedora would on account of CIWTC arrange on deck all risk insurance to cover the shipment while on board of the vessel, premises for such insurance to be for CIWTC account. The agreement further clearly stated that although title to the vacuvators and accessories will nominally be in the name of Vencedora until the sale by It to CIWTC as per separate agreement dated 4th Feb. 1976 (referred to earlier) all responsibility for maintaining, repairing and operating these vacuvators will be for the account of CIWTC and any time lost by the Mother Ship, namely Kapetan Markos in discharging will be the responsibility of CIWTC. The agreement was signed by Commander Chelliah on behalf of CIWTC.
(k) On 4.2.1976 Commander Chelliah, on behalf of CIWTC entered into another agreement with Vencedora at New York regarding the sale of 7 vacuvators to the former on payment of U.S. $ 2,000 payable in Indian currency as already stated and received alongwith the letter dated 12.7.1978 of ShriH. Ghosh of CIWTC.
(I) On 28.4.1976 M/s. M.M.P. Lines Pvt. Ltd. Calcutta as agents of Vencedora, handed over 7 vacuvators alongwith accessories and spares to CIWTC Ltd. on board ‘Kapetan Markos’.
(m) On 30.4.1976, CIWTC Ltd. sent to M/s. M.M.P. Lines Pvt. Ltd. a cheque for Rs. 17,920.00 equivalent to U.S. $ 2,000 In re-inbursement of the amount paid by the letter on behalf of the former to the Captain of ‘Kapetan Markos’ as cost of 7 vacuvators and accessories etc.
(n) In response to the Lok Sabha Secretariat’s letter No. 42/1 (3)PU-77, dated 17.2.1978, CIWTC informed, inter alia, as follows:-
“As per the agreement with the owners of Kapetan Markos NL Messrs Vencedora Oceanic Naviara of Panama, they advanced on behalf of C.I.W.T.C. a sum of U.S. Dollars 1,00,000.00 and further opened a letter of credit for U.S. Dollars 1,94,000.00 towards the expenses of the vacuvators. They made all the arrangements for collection of the vacuvators from the manufacturers, transportation thereof upto Sandheads in India, insurance etc. and deducted U.S. Dollars 88,477 for the purpose. The title of ownership was in the name of M/s. Vencedora Oceanic Naviara SA till the operation was over and sold vacuvators to C.I.W.T.C. the vacuvators were finally delivered to us as per agreement after the completion of the operation of grain unloading at a price of $ 2000 payable in non-remittable Indian currency. Other related payment (including the usage cost) were adjusted by the owners while arriving at the contractual value of the operation.”
4. On the basis of the above facts it was alleged that 7 vacuvators, spares and accessories cleared under bill of entry No. I-25 of 1.9.1976 were actually imported by M/s. CIWTC Ltd. (the appellant company herein) from M/s. Dunbar Kapple Inc. U.S.A. for which moneys were advanced by Vencedora and freight and insurance charges were also borne by them on behalf of CIWTC and that the total cost so incurred by Vencedora was finally adjusted against the contractual value of the lightering operation payable by Vencedora to CIWTC. It was further alleged that assessable value of the said vacuvators, accessories and spares were to the tune of U.S. $ 3,89,282.96 (calculation given in the show cause notice) equivalent to Rs. 35,07,433.69 and as such a duty of Rs. 20,10,427.87 was leviable on the said goods as against a duty of Rs. 27,760.32 paid under the aforesaid bill of entry. It was, therefore, alleged that duty amounting to Rs. 19,82,667.55 was evaded by wilful mis-representation and suppression of material facts by CIWTC Ltd. and their Managing Director Commander Chelliah. It was also alleged that the CCP for ITC purpose for Rs. 17.920/- produced by the appellant company hereto fell short of the actual value (Rs. 34,46,217.00 CIF) as aforementioned. On the basis of aforesaid allegation the goods would have been liable to confiscation under Section 111 (m) and 111 (d) respectively. Accordingly, a show cause notice dated 22.2.1979 was issued to M/s. CIWTC as to why a penalty under Section 112 of the Customs Act be not imposed on them. Cause was to be shown to the Collector of Customs, Calcutta. On the same day another show cause notice was issued as to why the aforesaid amount of duty of Rs. 19,82,667.55p be not recovered from them under proviso to Section 28(1) of the Customs Act. In the 2nd show cause notice regarding short-levy-the cause was to be shown to the Assistant Collector of Customs.
On due adjudication by the Assistant Collector of Customs, Calcutta, short-levy mentioned above was confirmed vide his order dated 18.4.1980. On appeal before the Appellate Collector of Customs, Calcutta against the confirmation of short-levy the appellant herein did not succeed. They filed a revision application to the Government of India which now stands transferred to this Tribunal.
In respect of the other show cause notice regarding proposal of penalty, Collector of Customs, Calcutta by his order dated 28.10.1981 imposed, inter alia, a penalty of Rs. 5 lakhs on the appellant company herein. Appeal before the Central Board of Excise and Customs decided vide their order dated 18.6.1982 also failed. The appellant company, therefore, have filed the appeal before the Tribunal which is the second mentioned appeal now.
5. The appellants’ learned advocate has now contended that the price of Rs. 42.71 lakhs as per the discharge agreement dated 4.2.1976 by way of remuneration was duly received by CIWTC. Revision of the discharge remuneration under the revised terms and conditions would obviously lower the remuneration, because lightering with own instrument and lightering with hired instruments being altogether different commercial concepts. Since CIWTC had carried out the lightering operation with the vacuvators owned by Vencedora, naturally Vencedora would pay lower remuneration to cover up against the cost, charges and expenses of bringing the vacuvators into India. Neither the discharge agreement nor the bailment agreement is under challenge. On the contrary, bailment agreement has been upheld by Central Board of Excise and Customs Order dated 18.6.1982. Therefore, the goods were bound to come over to India and that the charge that the goods were actually imported into India by CIWTC does not hold good. The discharge agreement not being under challenge, it does not lie in the mouth of the department to charge that there has been underhand manipulation on the discharging rate. The report of the Parliamentary Committee on Public Undertakings is that payment of Rs. 32 lakhs was made in dollars in America whereas the charge in the show cause notices is adjustment. It is, however, clear as a finding from the Collector’s order dated 28.10.1981 that CIWTC in fact received Rs. 42.71 lakhs out of discharge remuneration. Since the used second hand vacuvators alongwith spares and accessories were taken over by the appellant company on board Kapetan Markos from Vencedora. CIF value quoted in the quotation dated 14.1.1976 of M/s. Dunbar Kapple for new vacuvators alongwith accessories and spares cannot be taken as the value in terms of Section 14 of the Customs Act. This section stipulates the sale price of the goods under consideration and the sale in this case has been effected not on 13.2.1976 when the vessel started from U.S.A. but it has been effected only after completion of off loading of grain from Kapetan Markos in April 1976. In the face of the agreements and facts and circumstances of this case importation by CIWTC could not be said to have taken place before the aforesaid date. Till this date vacuvators had remained in the custody and ownership of Vencedora which were part of the stores of the ship and were not manifested in the IGM of the ship as cargo. Therefore, the value of the goods has to be taken as on 6.8.1976 when the bill of entry was filed. Obviously, it cannot be the same as the ex-factory price of the new goods before lightering operation.
6. Another argument of the learned counsel is on the question of short-levy regarding the time bar. He has submitted that there is no charge of suppression of bailment agreement or discharge contract in the show cause notice. It cannot be pleaded in the facts and circumstances of this case that any fraud was played by the appellant comparty. Value of the goods could be easily discovered by the Customs Officers by contacting the local agents of the manufacturers. This having not been done by the Customs Officers, charge of suppression of fact or wilful mis-representation cannot be laid against the appellant. There is no definite proforma of declaration of prices; therefore, the fact about the price of new goods as on 14.1.1976 cannot be treated as relevanMor this purpose and this knowledge on the part of the appellant company, cannot be a wilful mis-representation or a suppression. Accordingly, learned advocate asserts that the show cause notice for short-levy is barred by limitation. He relies in support of his proposition that the relevant date for taking the value of the goods has to be the date of clearing the goods from the warehouse, on the decision of Supreme Court in the case of Prakash Cotton Mills AIR 1979 SC 675) and (ii) Division Bench of Calcutta High Court reported in Calcutta weekly notes 305 in the case of Thomas Tuff & Co. (P) Ltd.
7. On the other hand, the learned SDR, Shri V.M. Doiphode arguing for the department has contended that reading of the bailment agreement entered into on 4.2.1986 between the Vencedora and the appellant company herein leaves no doubt that the goods were imported by or on behalf of CIWTC. He points out that advance of $ 1 lakh was given and letter of credit of U.S. $ 194000.00 was given by Vencedora to facilitate CIWTC. Insurance risk was covered by Vencedora on account of CIWTC and the appellant company herein was to be charged on that account. Loading, stowing, securing and lashing of the vacuvator in the port of Seattle Washington was undertaken by Vencedora at the cost of CIWTC. The bailment agreement further makes it clear that Vencedora were only the nominal owners of the vacuvators till their sale to CIWTC. Sale agreement dated 4.2.1976 executed separately leaves no option with the appellant company herein to reject the purchase of vacuvators. They were bound to take the goods on “as is where is” basis on board the Kapetan Markos in terms of that agreement. In the view of learned SDR Vencedora was acting merely as an agent of CIWTC. Therefore, in effect, according to him, vacuvators had been imported by CIWTC. This is apparent according to the learned SDR from the overall reading of all the three contracts entered into by the appellant company with Vencedora. A proper reading of contract, according to him, is the overall reading of it and not merely of various clauses in isolation. For this proposition, the learned SDR relies on 1961 (12) STC 464 – Kerala (in the case of Goverdhan Hathibhai & Co. v. Assistant Commissioner of Agricultural Income Tax and Sales Tax; he relies in particular on para 17 of American Jurisprudence quoted in the said Report at Page 471 which states as follows :-
‘The primary test of whether a particular contract or transaction whereby goods are delivered or shipped by one party to another for sale by the latter, creates the relation of buyer and seller or only a relation of principal and agent, is the intention of the parties to be gathered from the whole scope and effect of the language used and mere verbal formulas, if inconsistent with the real intention, are to be discharged.”
Viewed in the above context, learned SDR submits that vacuvators can be said to have been imported into India on the date when Kapetan Markos anchored at or of the port of Calcutta near Sagar on 12.3.1976. It is this date which is the date of importation and relevant for the purpose of determining the value of vacuvators in terms of Section 14. On this date the vacuvators were new and their CIF value as disclosed from the quotation dated 14.1.1976 of M/s. Dunbar Kapple has to be taken into account.
Another submission of the learned SDR is that the sale in the instant case has been done in the course of import of vacuvators. It is immaterial that the sale in the strict sense has been effected subsequently inasmuch as title in the goods to CIWTC has passed only in April 1986 after the lightering operation. Import of vacuvators in the instant case has been occasioned by the purported sale to be effected at a later date in terms of the agreement. It is not really material that the sale has taken place subsequent to import. For this purpose learned SDR relies on Supreme Court judgment in Sales Tax case in the case of K.G. Khosla & Co. v. Dy. Commissioner of Commercial Taxes 1966 (17) STC 473.
He also submits that the goods having been imported on 12.3.1976 even though as part of stores on Kapetan Markos and not as cargo, no depreciation on account of their use in India in lightering operations should be allowed. It is, therefore, the value of the new goods as on 12.3.1976 when they entered into India has to be taken into account. Depreciation on account of use of goods outside India alone can be permitted under the Customs law.
On the question of time bar, learned SDR submits that there is a dear scheme of things in the series of actions undertaken by the appellant company and that the scheme Is calculated towards evasion of duty Despite the fact that the appellant company knew the price of new vacuvators they did not disclose the same to the Customs. They did not place with the Customs Authorities any of the three agreements executed by them with Vencedora which would have made Customswise. Customs Officers might have failed in their duties inasmuch as they did not contact the local agent of the suppliers M/s. Dunbar Kapple. It was equally the responsibility of the importer to declare the correct value and they cannot be absolved of that responsibility. The plea of discoverable fact could be taken by the appellant company, according to the learned SDR if they had disclosed all the material facts available with them having bearing on the value of the goods. Disclosure of sale agreement to CCI for the purpose of obtaining a CCP cannot be taken as a disclosure to the proper officer of Customs. They have also not made full declaration to the ITC authorities regarding the real value of the vacuvators by disclosing the bailment agreement to them. It can, therefore, be stated that even the CCP was obtained by the appellant company by mis-representation and suppression. According to the learned SDR liability to confiscation of the goods under Section 111(m) and 111(d) respectively is proved beyond doubt and therefore, the confirmation of demand of duty and imposition of penalty is valid in law. Appeals, therefore, according to him, deserve to be dismissed.
8. Replying, learned advocate for the appellant company submits that agreements have to be read in what is stated in black and white there. Wisdom of the Court cannot be imported or implied by substituting the words in the agreements. He relies for this proposition on Supreme Court’s judgment in the case of Hakam Singh v. Gammon (India) Ltd. (AIR 1971 SC 740). He also submits that sale is a necessary ingredient of Section 14 and it is the sale price which is to be taken into account for determining the value under that Section.
9. We have carefully considered the pleas advanced on both sides. On an overall reading of all the three contracts entered into by the appellant company with Vencedora on 4.2.1986*. no doubt is left that the vacuvators were imported by or on behalf of the appellant company. The agreements have been entered into merely for the purpose of giving a cover of ownership to Vencedora till the lightering operations are over. In our view, the device adopted by the appellant company is nothing but a colourable exercise on the part of the appellant company to avoid payment of full duty of Customs. We agree with the teamed SDR that the agreement of contracts entered into by the appellant company with Vencedora have to be read as a whole. That reading does not leave any doubt that vacuvators were imported with the express purpose of ultimately selling them to CIWTC and the vacuvators that were imported on 12.3.1976, even though as part of stores of Kapetan Markos, were brand new. Value of vacuvators, therefore, for the purpose of assessment under Section 14 has to be taken as on the date of import and not on the date of artificial sale in April 1976 effected in terms of the sale agreement. It has been held by the Supreme Court in the case of Mcdowell & Co. Ltd. v. Commercial Tax Officer 1985 (3) SC Cases 230 that “colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid payment of tax by resorting to dubious methods. It is the obligation of every citizen to pay the taxes honestly without resorting to subterfuges [para 45 of the judgment delivered by Justice Ranganathan Misra (J)]”. Viewed in the light of the aforesaid judgment of the Supreme Court charge of mis-declaration of value against the appellant clearly comes out. Accordingly, liability (to) confiscation of goods under Section 111 (m) is proved beyond doubt Case law relied upon by the advocate is not relevant in the facts and circumstances of this case.
As regards the liability to confiscation under Section 111 (d) is concerned it is somewhat on different footing. Although the limiting factors in the CCP produced by the appellant are both quantity and value, it is apparent that the CCP produced is specifically for the 7 vacuvators. CCP was given because no foreign exchange was involved in the transaction. No evidence has been brought forth on record that the appellant company paid foreign exchange to M/s. Dunbar Kapple Inc. Therefore, they would have got the CCP even if they had declared the correct value of the vacuvators. Keeping all these facts in view and the fact in particular that there is a specific CCP for 7 vacuvators produced by the appellant, it cannot be held that the goods were imported in violation of the provisions of Import and Export (Control) Act. Hence, the charge of liability to confiscation of 7 vacuvators under Section 111 (d) cannot be sustained.
8. In view of the aforesaid findings, we pronounce the following orders :-
(i) Demand of confirmation of duty as sustained in the Order dated 23.5.1981 of Appellate Collector of Customs, Calcutta is upheld. Accordingly, appeal No. (1) i.e. 1856/81 -A is dismissed.
(ii) Penalty of Rs. 5 lakhs is reduced to Rs. 3 lakhs. In other words, the second appeal i.e. C/A. No. 1309/83-A is partly allowed.