Per S.S. Sekhon :

The appellant's were exporters of goods in the name of "BARON GOLD SERIES". They got the said goods manufactured from M/s. Fair Electrodes Pvt. Ltd., who were having Central Excise registration exported them under DEEC scheme. The Electrode were made of mild steel and silicon and other alloys which would render better than conventional welding. They received orders from buyers in Dubai and got the goods manufactured from M/s. Fair Electrodes Pvt. Ltd. the samples of goods were tested by them and their buyers, between 7.9.1999 and 10.9.1999, they sought to export 4698 gross (676512 pieces) under 10 Shipping Bills which are the subject matter of the present proceedings. Sample of the goods were drawn by Customs Authorities and goods were provisionally allowed to be exported. The Department did not make the final assessments; the appellants filed a petition in the Hon'ble High Court of Calcutta which directed Revenue to adjudicate expeditiously. A Show Cause Notice was issued on 23.02.2000 alleging, inter alia, that the 4698 gross of steel welding electrodes covered under 10 Shipping Bills, on investigation by the officers, were found to be over valued. The value of goods was Rs. 27,06,048/- instead of Rs. 4,39,73,280/- and thus the DEPB should amount to Rs. 3,04,430/-. Consequently, it was alleged that the appellant has wilfully misdeclared the FOB value of subject export consignment and did not disclose the actual value of the product. The exporters, the directors Shri Sudhir Satnaliwala along with M/s. Fair Electrodes Pvt. Ltd., their directors were issued Show Cause Notice as to why the goods covered under 10 Shipping Bills should not be held liable for confiscation under Section 113 (d) of the Customs Act, 1962 and penalty under Section 114 not be imposed on them; the present Market Value of subject exports consignment should not be rejected and revised as per guidelines as per Circular No. 79/98-Cus. dated 22.10.98 [reported in [reported in 1998 (29) RLT M48].

2.The Commissioner vide Order No. Kol./Cus./Port/72/2005 dated 06.05.2005 determined that the export goods covered under subject of 10 Shipping Bills having declared the FOB value of Rs. 4,13,37,876/- should be confiscated under Section 113 (d) under the Customs Act, 1962 read with Section 11 of FTDR Act, 1992 and Rule 11 of FT (Regulations) Rules, 1993, and since the goods were provisionally allowed to be exported, no redemption fine was imposed. The declared value of Rs. 65/- per piece was rejected and determined at Rs. 4/- per piece, Personal penalty of Rs. 5 Lakhs each on Kanhaiya Exports Pvt. Ltd. and its Directors, Shri Sudhir Satnaliwala under Section 14 along with the penalty of Rs. 5 Lakhs each on the Directors of M/ s. Fair Electrodes Pvt. Ltd., was arrived. Hence, the present appeal.

3. After hearing thematerial on record it is found:-

a) Full amount as per declared FOB values have been received and the appellant have submitted evidence to that effect before the Ld. Commissioner, no rebuttal of this proposition was shown to us as records detailed of payment received.

b) The foreign buyers is not related to the appellants, price is negotiated price, no part of the amounts of the benefit have been alleged or flowing to the foreign buyers, there is no material obtained by the Department of contemporaneous price of similar goods.

c) M/s. Fair Electrodes Pvt. Ltd., supply electrodes according to specification given by the exporters; goods were manufactured according to such specification and there is no dispute by the foreign buyers as regards to quality. The appellants have relied on the price list of M/s. Larsen and Toubro Ltd., showing that the price of certain varieties of electrodes to be much higher than the price of other electrodes; they challenged the people who cannot be said to be experts or technically qualified persons, and the appellants were denied cross examination of person where opinion were relied by the Department, such a