JUDGMENT NASIM SIKANDAR, J.- This further appeal under Section 196 of the Customs Act, 1969 seeks to challenge an order of the Customs, Excise and Sales Tax Appellate Tribunal, Lahore dated 5.3.2004.
2. The appellant imported 25000 pieces of Ball Bearings NO. 622-zz and 2500 pieces of Ball Bearing No. 6203-zz from China declaring total value of the consignment at US $13750. The goods were assessed to duties and taxes at the rate of US $0.28 per piece and US SO.37 per piece respectively under Second Appraisement System. However, before the goods could actually be released the appellant was served with a show-cause notice dated 1.2.1999. Para 2 of the notice stated as under:- "2. On physical examination of the consignment the ball bearings declared to be of China origin are found to be NTN brand of Japan origin. According to evidence available on record, the normal fair value of NTN brand ball bearings of Japan origin is @ Japanese Yen 70/pc & 80/pc respectively.
The total value of the consignment on the basis of comparable evidence has been ascertained at Yen 3750000/= (Rs. 1668480), as against the assessed value of US$ 16250/= (Rs. 819439/=). The importers are thus involved in gross misdeclaration of origin, brand & value to evade legitimate government revenue. Had this misdeclaration gone undetected the government would have suffered a loss of revenue to the tune of Rs. 38.257/- in customs duty, Rs. 1,45,625/- in sales tax and Rs. 55, 832/- in income tax (total Rs. 2,89,705/-)".
3. The reply submitted by the appellant was found unsatisfactory, in the adjudication proceedings that followed the appellant pleaded that copy of LC, Invoice, bill of lading and certificate of origin supported his case that the consignment did not conform to the standard of Japanese made Ball Bearings. Also that the composition of metal of imported goods was of low grade due to lower quality of the Chrome used therein. Further that the Japanese company NTN had franchises all over the world and though the goods in dispute were manufactured in China under Japanese name, that fact alone did not make them conformable to the standard of similar goods of Japanese origin.
4. The Collector (Adjudication) however, did not agree and finally through an order dated 1.3.1999 directed confiscation of the consignment though with an option to redeem the same on payment of fine equal to 100% of the ascertained value. Also a penalty of Rs. 50,000/- was imposed in terms of clauses (9) and (14) of Section 156 (1)' of the Customs Act, 1969. Earlier the Collector appears to have ignored the request of the appellant made before him that standard and quality of the consignment may be verified from a technical expert or laboratory of University of Engineering and Technology, PCSIR or any other relevant authority.
5. Learned Tribunal by way of the impugned order maintained the Order-in-Original. After reproducing the contentions of both the parties the learned Tribunal in the operative part of its order contained in para 5 held as under:- "5. We have heard the contentions of both the sides and perused the appeal file available before us. We have also inspected the samples of ball bearings produced by the learned counsel. The brand "NTN and Japan" are clearly engraved on these ball bearings. However, there was no mention of brand in the bill of entry and import documents filed by the importer for the clearance of consignment. There is lot of force in the arguments advanced by the learned D.R. That the goods of difference origin are shipped from the ports of other countries. On the contrary, the learned counsel of the appellant could not produce and evidence to prove his point that NTN brand ballbearings have been manufactured in China under some agreement between the principals in Japan and the manufacturer of China. The words "Japan" and brand "NTN" were clearly engraved on the imported goods, in view of above, the charges of ' misdeclaration are clearly established against the importer and we find no infirmity or defect in the impugned order.
However, penalty of Rs. 50,000/- appears harsh and is reduced to Rs. 10,000."
6. The learned Members of the Tribunal also appear to have ignored the request made by the appellant before them to get the quality of the consignment verified through a technical/expert opinion.
7. Heard the learned counsel for the parties. Learned counsel for the appellant is correct in maintaining that the. Revenue as well as the Tribunal clearly misdirected themselves by ignoring their request to get the consignment tested from a laboratory to determine .The difference in standard, material and speed viz-a-viz Japanese origin Ball Bearings. The Collector (Adjudication) in para 6(ii) of his order and the learned Tribunal in para 3(xii) of the impugned order duly noted the request of the appellant. However, none of them recorded any reason for their refusal to get the consignment tested from a official laboratory. The appellant has, therefore, been treated unfairly. A matter which could have been decided directly on obtaining the expert opinion was attempted to be approached indirectly and distantly. The Revenue as well as the Members of the Tribunal ought to have gone for the first rate evidence instead of straining on comparable cases of imported Japanese Ball Bearing. An inquiry into the value of comparable cases was relevant only when first it was found as a fact that the consignment imported by the appellant was of Japanese origin. The failure on their part to accepted the request of the appellant to get the consignment tested from an expert or an official laboratory has therefore resulted in miscarriage of justice.
8. Therefore, the impugned order of the Tribunal is set aside. The matter is remitted to it for a decision afresh after obtaining an expert opinion or report from a laboratory of an official organization as mentioned in the offer made by the appellant before the Collector (Adjudication).
9. The appeal is partly accepted in the above terms.