1988 (10) TMI 234 - AT - Customs

Summary

Issues Involved:
1. Validity of Import Licence
2. Classification of Imported Goods
3. Enhancement of Value of Imported Goods
4. Imposition of Fine and Penalty

Detailed Analysis:

1. Validity of Import Licence:

The appellants contended that the Collector erred in holding that the licence produced was not valid for the goods imported. The Collector's view was that the components, when put together, formed a complete copier and thus could not be considered as individual components. This was contested by the appellants, who cited the cases of Mebod v. The Collector of Customs, Madras, and Union of India v. Tarachand Gupta & Bros., which supported their stance that the imported parts in SKD/CKD condition should be considered as components and not as a complete machine.

The Tribunal found that the Collector erred in treating the SKD/CKD packs of the copiers as assembled copiers for the purpose of Schedule-1 to the Imports (Control) Order, 1955. The Tribunal relied on the precedent set by Union of India v. Tarachand Gupta & Bros., where it was held that combining consignments to form a complete machine was not correct. The Tribunal also referenced the Calcutta High Court's decision in Collector of Customs, Calcutta v. Mitsuny Electronic Works, which emphasized that one must look into the respective licence and not the fact that assembling all consignments would result in complete machines.

However, the Tribunal upheld the Collector's alternative finding that even if the parts in SKD/CKD packs were viewed individually, the licence produced was not valid for any of the items imported. The Collector's detailed findings included discrepancies in the description, value, and quantity of the imported items compared to those indicated in the licence. The Tribunal found no reason to differ from these findings.

2. Classification of Imported Goods:

The Collector classified the SKD/CKD parts of the copiers as fully assembled copiers under Rule 2(a) of the Rules of Interpretation of the Customs Tariff Act, 1975. This classification was contested by the appellants. The Tribunal found that the Collector's classification was incorrect, referencing the Supreme Court's decision in Union of India v. Tarachand Gupta & Bros., which held that parts should not be classified as complete machines unless specifically provided for in the Import Policy.

3. Enhancement of Value of Imported Goods:

The appellants argued that the Collector erred in enhancing the value of the imported goods and rejecting the various quotations they provided. The Collector determined the value based on quotations from M/s. Shun Hing Technology Ltd., Hongkong, which were submitted by the appellants themselves to the Development Commissioner (Small Scale Industries), Government of India, New Delhi. The Tribunal upheld the Collector's decision, noting that the appellants had admitted that the invoice values did not represent the correct prices. The Tribunal agreed with the Collector's valuation method under Section 14(1) of the Customs Act, 1962, read with Rule 8 of the Customs (Valuation) Rules, 1962.

4. Imposition of Fine and Penalty:

The appellants contended that there was no case for the imposition of fine or penalty. The Collector found the appellants guilty of misdeclaring the description and value of the imported goods and provided reasons for imposing fines and penalties on both the importers and their Managing Director, Shri P.N. Sadanand. The Tribunal upheld the Collector's decision, finding no merit in the appellants' contention.

Conclusion:

The Tribunal dismissed the appeals, finding no merit in the appellants' arguments. The Tribunal upheld the Collector's findings on the invalidity of the import licence, the classification of the imported goods, the enhancement of the value, and the imposition of fines and penalties. The Miscellaneous Application for permission to file additional documents was also rejected as it was not pressed during the hearing.