2001 (11) TMI 412 - Commission - Customs

Issues Involved:
1. Judicial or quasi-judicial authority of the Commission.
2. Reliance on the Tribunal's decision in Orson Electronics Pvt. Ltd. v. Collector.
3. Applicability of the Tribunal's decision in Orson Electronics Pvt. Ltd. to the present case.
4. Applicability of the Tribunal's decision in Samrat Enterprises v. Commissioner.
5. Determination of assessable value based on the lowest transaction value.
6. Relevance of the Tribunal's decision in Orson Electronics Pvt. Ltd. and absence of evidence of contemporaneous imports.
7. Imposition of tax without authority of law.
8. Calculation of freight and insurance on a notional basis.
9. Legality and implementation of the Commission's order.

Issue-wise Detailed Analysis:

1. Judicial or quasi-judicial authority of the Commission:
The Applicant argued that the Commission, being a judicial or quasi-judicial authority, must act judiciously based on evidence and material on record. The Commission's determination of Additional Duty liability of Rs. 23,01,077/- was claimed to be unsupported by evidence, thus liable to be set aside.

2. Reliance on the Tribunal's decision in Orson Electronics Pvt. Ltd. v. Collector:
The Applicant contended that the Commission erred in relying on the Tribunal's decision in Orson Electronics Pvt. Ltd., which was approved by the Supreme Court. The reliance on this decision was deemed misconceived and baseless, thereby vitiating the impugned order.

3. Applicability of the Tribunal's decision in Orson Electronics Pvt. Ltd. to the present case:
The Applicant argued that the decision in Orson Electronics Pvt. Ltd. was not applicable to the present case due to factual differences, such as the goods being from the same manufacturer and brand. The Commission was misdirected in law and facts by relying solely on this decision.

4. Applicability of the Tribunal's decision in Samrat Enterprises v. Commissioner:
The Applicant suggested that the Tribunal's decision in Samrat Enterprises was more appropriate for the present case. The Commission failed to appreciate this and instead relied on the Orson Electronics case.

5. Determination of assessable value based on the lowest transaction value:
The Applicant argued that under Rules 5 & 6 of the Customs Valuation Rules, 1988, the assessable value should be based on the lowest transaction value of identical or similar goods. The Commission's demand was based on higher values, leading to an erroneous order.

6. Relevance of the Tribunal's decision in Orson Electronics Pvt. Ltd. and absence of evidence of contemporaneous imports:
The Applicant claimed that the Commission's order was based on irrelevant facts, like the decision in Orson Electronics Pvt. Ltd., and ignored relevant facts such as the absence of evidence of contemporaneous imports at comparable prices. This rendered the order without jurisdiction and authority of law.

7. Imposition of tax without authority of law:
The Applicant argued that the impugned order imposed tax without authority of law, violating Article 265 of the Constitution of India.

8. Calculation of freight and insurance on a notional basis:
The Applicant contended that the Commission calculated the element of freight and insurance on a notional basis despite actual amounts being available on record, leading to an erroneous determination of duty liability.

9. Legality and implementation of the Commission's order:
The Applicant sought a writ to restrain the implementation of the Commission's order and requested the Hon. Court to consider its legality and quash the impugned order dated 2-8-2001.

Commission's Consideration and Decision:

Judicial or quasi-judicial authority:
The Commission noted the Applicant's submissions but emphasized that the determination was based on the facts and evidence presented. The Commission's role as a fact-finding body was reiterated.

Reliance on Orson Electronics Pvt. Ltd.:
The Commission justified its reliance on the Tribunal's decision in Orson Electronics Pvt. Ltd., noting its similarity in facts to the present case. The decision had been upheld by the Supreme Court, lending it significant legal weight.

Applicability of Samrat Enterprises:
The Commission acknowledged the Applicant's reference to Samrat Enterprises but found that the facts of the Orson Electronics case were more relevant and applicable to the present case.

Determination of assessable value:
The Commission considered the Applicant's argument regarding the lowest transaction value but emphasized that the Customs Valuation Rules must be read in their entirety, including Rule 4. The Commission found no mistake in its original order.

Relevance of Orson Electronics and evidence of imports:
The Commission maintained that its order was based on relevant facts and evidence, including export declarations and the Applicant's own admissions. The absence of contemporaneous import evidence did not invalidate the order.

Imposition of tax and Article 265:
The Commission found no violation of Article 265, as the order was based on legal provisions and evidence.

Calculation of freight and insurance:
The Commission justified its calculation method, noting that the actual amounts were considered where available. The notional basis was used appropriately in the absence of specific data.

Legality and implementation:
The Commission followed the High Court's direction to consider the rectification application but found no legal provision allowing it to rectify its own order. The Commission emphasized that it had no inherent power to review its terms of settlement.

The Commission concluded that the Applicant's miscellaneous application lacked merit both legally and factually. The application was rejected, and the original order dated 2-8-2001 was upheld.

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