IMPORTANT POINT
When question has already been decided by a larger Bench of CEGAT and approved by Supreme Court, the concerned CEGAT Bench ought to know the same and decided the matter accordingly.

JUDGMENT

Dr. ARIJIT PASAYAT, J.—

1.Since all these appeals relate to identical question, they are taken up for disposal by this common judgment.

2.The basic issue is when the market value of goods under export is much less than the amount of drawback claimed, whether such goods can be confiscated for violation of the provisions of the Customs Act, 1962 (in short the ‘Act’). In the matters relating to CA No.4559-4561 of 2002, the respondent had sent a consignment to the export shed of ICD, TKD, New Delhi for exporting the same under claim for duty drawback. On the basis of intelligence, Directorate of Revenue, Intelligence (in short ‘DRI’) detained the consignment. It was, prima facie, noted that the goods did not appear as per description, quantity and value disclosed in the bills. The consignments of the respondents were examined on different dates by DRI.

3.Consignment of R1 was examined by DRI on 7.1.1999 & 12.1.1999, Consignment of R2 was examined by DRI on 18.1.1999 & 25.1.1999, Consignment of R3 was examined by DRI on 14.1.1999 & 08.02.1999.

4.The Commissioner of Customs directed confiscation of all the goods under Section 113(d) and (i) of the Act and allowed to redeem of the same on payment of fine of Rs.10,00,000/-, disallowed the export of readymade garments and claim of drawback. No penal action was invoked as DRI contemplated to seek separate adjudication in respect of the penal clause provided under the Act. Appeals were preferred before the Customs, Excise and Gold (Control) Appellate Tribunal (in short ‘CEGAT’) which allowed the appeals holding that there was no power of confiscation and there was no material placed to record to suggest that the goods did not correspond to any material entry made in the bills and the correct ness of the FOB and description of the goods specified in the bills had not been disputed.

5.In support of the appeal learned counsel for the appellant submitted that Section 113(1) (d) and & (c) apply as they deal with three types of goods i.e. excisable goods, prohibited goods and goods entered for exportation. Respondents attempted to export old and used readymade garments etc which is not permissible under Rule 3 of the Drawback Rules. The market value was less than duty drawback which was not admissible under Section 76(1)(b) of the Act. CEGAT has erroneously interpreted the provisions of Section 113(d) and (c) of the Act. The contents of the show-cause notice were not properly analysed.

6.Learned counsel for the respondent on the other hand supported the order of the CEGAT.

7.It is to be noted that in view of the divergence of opinion between the several benches of the CEGAT, matter was referred to a larger bench and the larger bench decision was assailed by the assessee in the concerned case. Before this Court in Om Prakash Bhati v. Commissioner of Customs, Delhi,1 (2003 (6) SCC 161) it was, inter alia, observed as follows :

“6.At the outset, we would state that the learned counsel for the appellant has not pressed for the drawback in view of specific provision of Section 76 which inter alia provides that no drawback shall be allowed “(b) in respect of any goods the market-price of which is less than the amount of drawback due thereon”. Therefore, for the purpose of getting drawback, relevant consideration is the market price of the goods prevailing in the country and not the price of the goods which the exporter expects to receive from the overseas purchaser.

7.Next — as the order for confiscation of goods is passed by referring to Section 113(d) of the Act, we would refer to the same. It reads as under :—

“113. Confiscation of goods attempted to be improperly exported etc.—The following export goods shall be liable to confiscation:—

(d)any goods attempted to be exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force.”

8.The aforesaid Section empowers the aut