B. Ravichandran ORDER
S.K. Mohanty, Member (J)
1. Brief facts of the case are that the appellant imported three Nos. of Speed Post Parcel at Foreign Post Office (FPO), Kotla, New Delhi. The goods were containing the declaration of "Artificial Gift Item", valued at USD 110. The Customs Officers after examining the goods, found that the parcel contained "unbranded Micro SD Cards" of various storage capacities. Since there was mis-declaration, the Department seized the same on 20.01.2016. A show cause notice dated 20.07.2016 was issued, proposing to confiscate the goods on the ground of mis-declaration and under-valuation of the same. By the impugned order, the ld. Commissioner of Customs, Air Cargo Exports, rejected the value as declared by the appellant and re-determined the assessable value of 1,78,500 Nos. of Micro S.D. Cards at Rs. 2,10,71,523/- and also confiscated the goods under Section 111(d) and (m) of the Customs Act, 1962, with the option to redeem the same on payment of redemption fine of Rs. 40,00,000/-. Further, the impugned order has also imposed a penalty of Rs. 20,00,000/-under Section 112 and 114AA of the Act.
2. The ld. Advocate appearing for the appellant argued the matter at length on merit. It is submitted that memory cards are classifiable under sub-heading No. 85235220 and not under 85235100, as claimed by the Department. It is also submitted that even the memory cards are classifiable under sub-heading No. 85235100, as claimed by the Revenue, still the same are covered by the exemption Notification No. 24/2005-Cus., dated 01.03.2005, as amended, in respect of the Customs duty leviable thereon. Thus, he submitted that the excess paid Customs Duty should be eligible for refund to the appellant. It is also contended that the overseas supplier of the goods had made the declaration in the post parcels that the goods contained therein were artificial gift items. Since, the appellant had no knowledge of the mis-declaration of goods, confiscation of the same and imposition of fine and penalty are not justified.
3. The ld. DR for Revenue reiterated the findings of the adjudicating authority. It is submitted that the adjudicating authority after considering the CBEC Circular No. 12/2012 : MANU/CUCR/0026/2012 dated 01.05.2012 observed that Micro S.D. Cards are classifiable under CTH No. 85235100. He also stated that since the goods were mis-declared, the appellant is exposed to the penal consequences provided under the statute and accordingly, imposition of redemption fine and penalty in the adjudication order is proper and justified.
4. Heard both sides and perused the case records.
5. In this case, the appellant had classified the imported goods i.e. "unbranded Micro SD Cards" under CTH 85235220, providing for 'Nil' rate of Basic Customs Duty. However, the ld. adjudicating authority had classified the subject goods under CTH 85235100, which attract 10% Basic Customs Duty. For arriving at the classification issue, the ld. adjudicating authority has referred to the CBEC Circular No. 12/2002 : MANU/CUCR/0026/2012 dated 01.05.2012. We note that the goods of Tariff Item No. 8523 are exempted from payment of Basic Customs Duty under Notification No. 24/2005........