2007 (12) TMI 113 - AT - Customs

Assorted Computer parts (procured internationally at low prices) can t be valued taking value of contemporaneous imports T.V. can t rejected if there is no allegation that importer paid more price then prescribed in B/E or they are related person T.V. goods can t be rejected mere for not describing mfg. Co. goods received as compliment from supplier can t be said misdeclared despite not mentioned in packing list goods having different technical character can t be taken as contemporaneous

Issues Involved:
1. Mis-declaration of brand and model of imported goods.
2. Suppression of import of certain goods (processors).
3. Rejection of declared transaction value.
4. Adoption of valuation under Rule 8 of the Customs Valuation Rules (CVR).
5. Alleged procedural lapses by the Department.

Detailed Analysis:

1. Mis-declaration of Brand and Model of Imported Goods:
The Commissioner found that the importer did not declare the brand and model of the imported goods, which included Sun brand cabinets, servers, and monitors. The importer argued that internationally accepted codes like "Ultra 10" and "E-250" were declared, which are known to be Sun brand items. The Commissioner's finding of suppression of brand was deemed not well-founded as the codes used were recognized in the computer trade.

2. Suppression of Import of Certain Goods (Processors):
The importer did not declare processors found in the Sun brand cabinets. The importer explained that these processors were supplied without their order and were obsolete. The Commissioner rejected this explanation, considering it a deliberate act of suppression. However, the Tribunal found the importer's explanation plausible and granted them the benefit of the doubt.

3. Rejection of Declared Transaction Value:
The Commissioner rejected the declared transaction value on the grounds of mis-declaration and suppression. The Department compared the prices with those of Sun Micro Systems, First Computers, and Wipro Infotech, finding the declared prices significantly lower. The Tribunal noted that the importer had not made an incorrect declaration of the description of the items, and the rejection of transaction value on the ground of non-declaration of brand was not sustainable.

4. Adoption of Valuation under Rule 8 of CVR:
The Commissioner resorted to Rule 8 of CVR for valuation due to the lack of contemporaneous imports of similar/identical goods. The Tribunal found that the Commissioner's method of valuation was arbitrary and not consistent with the valuation provisions. The Commissioner adopted prices of items imported by other importers without establishing their comparability, which was not justified.

5. Alleged Procedural Lapses by the Department:
The importer argued that the Department relied on the opinion of competitors (Wipro Infotech and First Computers) without allowing cross-examination. The Tribunal found that the denial of cross-examination weakened the Commissioner's findings. The technical characteristics of the goods compared were not disclosed to the importer, further weakening the Department's case.

Conclusion:
The Tribunal set aside the Commissioner's order, finding that the rejection of the transaction value was not legally justified and the valuation adopted was arbitrary. The importer was directed to pay duty on the processors at the rate of 40 US dollars each, as accepted. The appeal was disposed of on these terms.

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