1998 (1) TMI 203 - AT - Customs

Summary

Issues:
1. Challenge to the prices of imported goods by Revenue.
2. Adjudication of prices by the Additional Collector of Customs.
3. Appeal before the Tribunal regarding the prices.

Analysis:

Issue 1: Challenge to the prices of imported goods by Revenue
The appellant imported SKF bearings with different part numbers and declared certain prices. The Revenue challenged these prices by issuing a show cause notice based on SKF price lists effective from 15-4-1989, after allowing a 20% discount. The show cause notice also referred to an invoice dated 26-12-1990 in support of the prices alleged. The appellant challenged this action by filing a writ petition before the Calcutta High Court.

Issue 2: Adjudication of prices by the Additional Collector of Customs
Upon adjudication, the Additional Collector confirmed the prices based on the SKF price lists for the part numbers after allowing the 20% discount. The appellant appealed this decision before the Tribunal, arguing that the discount allowed was not the maximum as per the SKF letter dated 11-4-1989. The appellant also contended that the price list was outdated as it was from 15-4-1989, and the goods were imported almost 2.5 years later.

Issue 3: Appeal before the Tribunal regarding the prices
During the appeal, the appellant's consultant argued that the adjudicating authority erred in relying solely on the SKF price list without considering that higher discounts were possible upon request. The Tribunal noted that the discount allowed was not the maximum, and the supplier likely obtained the goods at prices lower than those listed in the SKF price list minus 20%. The Tribunal found that the transaction value of the goods should not have been ignored by the Additional Collector, who made a wrong decision by relying solely on the price list. Consequently, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellant, providing consequential relief.

This judgment highlights the importance of considering all relevant factors, including the context of price lists and the possibility of higher discounts, in determining the transaction value of imported goods for customs valuation purposes.