1984 (5) TMI 249 - AT - Customs

Summary

Issues: Valuation of imported goods, reliance on price list, relationship between importing parties, assessable value determination

Valuation of imported goods:
The case involved the importation of a production line for manufacturing flexible polyurethane foam. The appellants declared a certain value for the goods, but the assessing officer found discrepancies in the declared value compared to the actual price list. The Assistant Collector adjudicated the case and determined a higher assessable value for the goods, leading to a duty payment demand on the enhanced value. The Appellate Collector of Customs, Madras upheld the findings of the lower authority, resulting in the appellants challenging the decision before the Appellate Tribunal CEGAT.

Reliance on price list:
During the appeal, the appellants argued that the lower authorities erred in relying on the undated price list for valuation purposes. They contended that the price list produced by them was not meant for valuation but for technical specifications. The respondent, however, argued that the price list was valid and pointed out a letter indicating a special reduction in prices for the appellants, suggesting a financial interest between the appellants and another party involved in the importation process.

Relationship between importing parties:
The case revealed a significant relationship between the appellants and another company involved in importing a similar machine. The appellants' equity capital was held by the other company, indicating a financial tie-up and control. The Tribunal noted the interconnection between the two companies, highlighting the importance of this relationship in determining the assessable value of the imported goods.

Assessable value determination:
After considering the arguments from both sides, the Tribunal concluded that the appellants' attempt to disassociate from the implications of the price list they themselves provided was not convincing. The Tribunal found a clear financial interest link between the appellants and the other importing party, leading to a dismissal of the appeal. The Tribunal upheld the decision of the lower authorities to enhance the assessable value of the goods based on the price list and other relevant factors, emphasizing the appellants' failure to disclose their financial relationship with the other party.

In conclusion, the Appellate Tribunal CEGAT upheld the decision of the lower authorities to enhance the assessable value of the imported goods, dismissing the appeal due to the clear financial ties between the appellants and another importing party and the reliance on the price list for valuation purposes.