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TMI Blog1991 (4) TMI 234X X X X Extracts X X X X X X X X Extracts X X X X ..... duction in price on the ground that similar machineries of Polish and Russian origin were available at lower prices. The suppliers representative accordingly agreed to reduce the prices and revise the contract. The total value of the contract for eight different items of machinery was reduced from Rs. 8,08,435 (CIF) to Rs. 6,72,456 (CIF). A contract was accordingly signed on 25th April, 1980. When the appellants declared the value of their goods, on the basis of the invoice, the Assistant Collector did not accept it on the ground that the price of these goods in a Price List dated 12th February, 1979, which was in possession of the authorities, was higher. The appellants explanation was that a deduction of 20% on account of trade discount was given to them on the Price List of 1979 and the reduced price should therefore, be accepted for purposes of assessment. Since the appellants did not want to delay clearance of the goods, they agreed to pay duty on the higher price and subsequently requested the Assistant Collector to issue a speaking order rejecting the invoice price and that is how these proceedings began. 3. The Assistant Collector has recorded the following reasons for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Entry No. 14/198 and 605/93, dated 31-12-1980 and 31-5-1981 from GDR which were cleared through Madras Customs, where the reduced discount of 20% on 1979 price list was offered. These Bs/E could not be submitted by the appellants either along with the appeal petition or at the time of personal hearing. However the fact remains that there is evidence to suggest that such discount is offered to all. This ought to have been taken into consideration by the Assistant Collector. As against this, a point can be raised that if in fact the GDR had reduced the price by 20% on the basis of negotiations, then they could have issued a reduced price list with a reduction of 20% after the negotiations were completed, to their Indenting Agents, but there is no evidence to the effect that the agency in GDR had in fact reduced the price by 29%. There is only a letter from M/s. S.K. Ram Company, Indenting agents to the effect that a discount of 25% had been allowed on 1979 price list by their principals. This should have been corroborated by a letter from the supplying agency in the GDR which has not been submitted. In view of this, I am of the opinion that in the absence of any documentary evide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed were negotiated prices between two independent parties in the ordinary course of business as evidenced by contemporaneous correspondence with the office of the Joint Chief Controller of Exports and Imports, Madras; (g) the authorities failed to appreciate that indication of availability of discount to the extent of 25% on the listed price shown at the end of the manufacturers price list for 1979 was not special at all, but was in the nature of discounts universally available to all alike and that at best, the suppliers thereby reserve the right unto themselves to offer the goods at varying prices to different importers according to demand and supply; (h) that as actual users importing goods for use in their own factory, the appellants had merely acted as businessmen of ordinary common prudence in negotiating for and obtaining a most favourable price and there was no justification to reject the declared price. 7. While arguing the appellants case, Shri N.C. Sogani, the learned Consultant, stated that the foreign suppliers apparently did not display the discount in the invoice etc., for keeping a bargaining capacity with their customers and explained that though a deduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orrespondence produced as additional evidence by the appellants should not be accepted or, in the alternative, the matter may be remanded to the Assistant Collector for decision in the light of evidence contained in these letters. 10. Shri N.C. Sogani, the learned Consultant for the appellants, stated in his reply that the 1979 Price List of the suppliers showing the discount had not been disputed by the Department and all that Collector (Appeals) observed in his order was that there should have been a corroboration in the form of a letter from the supplying agency. Since this letter was now available, there was no reason why the appellants claim in the appeal should not be accepted. 11. We have carefully considered the submissions of both sides and perused the case records. The authorities have rejected the invoice price on the ground that the Price List of 1979 available with them showed a higher price. We observe that copy of this Price List is nowhere on record. On the contrary, the appellants have submitted a copy of their suppliers Price List dated 5-4-1979 which shows special trade discount upto 25%. While the Assistant Collector did not go into the reasons for rejecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acceptable on their face value because of a circular letter of the authorised agent and addressed generally to traders and indicating the special nett prices for bearings for India. In the peculiar facts of that case the Tribunal has recorded detailed reasons in paras 11 and 12 of their order, the circumstances under which the invoice price was considered not to be acceptable. It does not appear from the facts recorded in the orders of both the lower authorities in the present case, that they had undertake any investigation and recorded any reasons for rejecting the invoice price except to say that the Price List available with them showed a higher price. We do not, therefore, think that the decision in Automotive Enterprises case is of any help to the Department for rejecting the invoice price in the present case. In fact, Collector (Appeals) has rejected it merely for want of corroboration. 14. In the Consolidated Coffee case (supra), the Tribunal observed as under in para 5(c) : - the deemed value of imported goods, where duty is to be levied ad valorem is, in terms of S. 14 of the Act, not their actual value, the invoice value or the price at which they are capable of bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was enough circumstantial evidence to justify the enhancement of value and to reject the invoice price. The facts of the present case are different and, in view of what has been seen by us, the ratio of those decisions would not apply to the present case. 17. Aarkeyess case cited by the JDR, in which there is an observation that manufacturers Price List should be treated to be the best evidence, supports the appellants case rather than the Department s case. Two Price Lists of manufacturers were available - one with the Customs authorities and the other with the appellants and the circumstances under which discounts were offered and the price in this particular case was reduced have been duly explained in the supplier s letter. We do not, therefore, think that the decision in Aarkeyess case is of any help to the Department. In this view of the matter, we do not see any reason why the invoice price should have been rejected. Having examined all aspects of the matter, we allow the appeal and set aside the impugned order of the lower authorities with consequential relief, if any. 18. In respect of Appeal No. 434/84-A, which also involves the import of flour milling machinery, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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