Per Justice K.K. Usha : The challenge in this appeal at the instance of the importer is against the order passed by the Commissioner of Customs, Jodhpur dated 3.9.2002. Under the above order the Commissioner had enhanced the assessable value of the goods imported under Bills of Entry dated 14.8.96 and 27.8.96. A duty demand amounting to Rs. 1,57,511/- was made under the first proviso to sub-section (1) of Section 28 of the Customs Act, 1962 in addition to the duty already paid by the party. Further an amount of Rs. 1,00,000/- was ordered as redemption fine and a penalty of Rs. 1,57,511/- was imposed on the importer under Section 114A of the Customs Act, 1962. Thereafter, an amount of Rs. 40,000/- each was imposed on the two partners under Section 112 of the Customs Act, 1962. It was also held that the importer is liable to pay interest under Section 28AB of the Customs Act. Aggrieved by the above, the importer has come up in appeal.

2. The main contentions raised are-

(1) the adjudicating authority has erred in enhancing the assessable value on the basis of the declaration alleged to have been filed by the foreign supplier of the goods with the Customs & Excise Department. Hong Kong.

(2) no redemption fine could have been imposed in this case as the goods were not available at the time of assessment. (They were permitted to be cleared in 1996 whereas show cause notice was issued only in 2001).

(3) the penalty under Section 114A could not have been imposed since the above provision came into force only on 28.9.96 whereas import was earlier to that date. Interest also could not have directed to be paid under Section 28AB as that section came into force only on 28.9.96.

(4) no penalty could have been imposed on the partners when the penalty had already been imposed on the importer firm.

3. The appellants are manufacturers of digital watches for children. They imported components parts of electronic modules for digital electronic watches from M/s. Alam Trading Company, Hong Kong under two Bills of Entry dated 14.8.96 and 27.8.96. Clearance of the goods was allowed by Customs, Jaipur on payment of duty on declared CIF value. Acting on an intelligence officers of the DRI initiated investigations in the matter. Inquiries were made with the Hong Kong Customs and Central Excise Departmental through Consulate General of India, Hong Kong for ascertaining the actual value of goods declared before them by the supplier. Pursuant thereto Consulate Genera of India, Hong Kong took up the matter with the Head of Trade Licensing Investigation Bureau of Hong Kong Customs & Excise Department and forwarded a copy of the export declarations lodged by the supplier M/s. Alam Trading Co. Hong Kong. To the Hong Kong Customs & Excise Department in respect of the aforesaid goods exported to the appellant. An examination of the export declarations made it clear that there is gross variance in the values stated in the invoices issued by the supplier to the appellant vis-a-vis values lodged with the Hong Kong Customs. The CIF value and assessable value thus calculated worked out to Rs. 2,19,986/- and Rs. 2,22,186- respectively as against Rs. 1,63,350/- Rs. 1,62,964/- respectively declared by the appellant in respect of the consignment imported vide Bill of Entry No. 1148 dated 14.8.96. In the case of the Bill of Entry No. 1207 dated 27.8.96 the CIF value and the assessable value thus calculated worked out to Rs. 4,75,139/- and 4,79,890/- respectively as against Rs. 1,53,513/- and Rs. 1,55,049/- respectively declared by the appellant. It is on this basis show cause notice was issued.

4. It is contended on behalf of the appellant that the adjudicating authority could not have accepted the value alleged to have been shown in the export declarations made by M/s. Alam Trading Co. The document does not bear any signature or official seal of Customs department, Hong Kong. The authority of the document is questionable. Quantity and description shown in the exp