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TMI Blog1992 (10) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... rent Policy without proper import licence and that the goods are under-invoiced for the purpose of assessment of Customs duty. Accordingly, Show Cause Notice was issued for confiscation of the goods as well as for imposition of penalty mainly charging that the goods are covered by App.-2, Part B and is a restricted item. It was charged in the Show Cause Notice as The importers had deliberately suppressed the model number, brand name and other specifications in the bill of entry and also in the import documents; (ii) having known that the goods are for car air conditioners and there are various models of car air conditioners and their parts, they had not declared to the customs, the full details of the goods. They had misdeclared the value with an intention to evade customs duty to the tune of Rs. 25,36,363/- and they had attempted to clear the goods against import licences which were not valid." The Show Cause Notice was duly answered by the appellants denying the charges and among other various contentions it was contended that :- the importers had deliberately suppressed the model number, brand name and other........... The licences produced by them are valid for the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccordingly, he ordered for confiscation of the goods under Section 111(d) and 111(m) of the Customs Act, 1962. However, he gave an option to redeem the goods on payment of fine of Rs. 10,00,000/- in addition to imposition of penalty of Rs, 5,00,000/- under Sec. 112(a) of the Act. Aggrieved by the said order, the appellants have come before us by way of this appeal. 3. We have heard Shri G.L. Rawal, learned Advocate for the appellants and Shri Prabhat Kumar, learned JDR for the respondent. 4. There are two issues involved in this case viz. - 1. Validity of the import licences for the import and 2. Valuation. On the issue of validity of import licences Shri Rawal submitted that licences produced by the appellants were valid for items falling under Appx. 3, Part A as per Para 215(2)(4) and 177 of AM 1988-91. The Department cannot rely upon the Public Notice No. 109/89, dated 21-3-1989 which amended the policy and added condensors for Car Air Conditioners at Item 130A to Appendix 2, Part B, since Public Notice which was issued on later date cannot take away the flexibility already granted to licences. As per endorsement made on the licences, the flexibility under Para 215 and 177 c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It was contended by him that it is not correct to say that Public Notice has no statutory force inasmuch as Government was competent to amend import policy by issue of Public Notice as it was held by the High Court in the case of S.S. International v. Union of India 1989 (44) E.L.T. 440 (Delhi) and Public Notice has binding effect as it was duly observed by the Tribunal in the case of Raymond Woollen Mills Ltd. [1986 (26) E.L.T. 962]. He said that validity of licence is to be considered in terms of policy when actual import effected relying upon the following decisions :- 1. P. Ripalkumar Co., Bombay v. U.O.I, Others - 1987 (32) E.L.T. 668. 2. Raj Copper Cable Industry v. Collector of Cus. -1988 (38) E.L.T. 371. 3. M/s. Indo. Afghan Chamber of Commerce and Another v. Union of India and Others - AIR 1986 S.C. 1567. Shri Rawal in rejoinder submitted that in view of the conflicting nature in between the endorsements on front portion and back portion of the licence and no change of policy with reference to condensers has been brought out in the Show Cause Notice, benefit cannot be denied in terms of valid licence. He contended that decisions relied upon by the Departmenta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation in the case of M/s. Indo Afghan Chamber of Commerce and Anr. v. U.O.I. Anr. (supra) with reference to the order of the Supreme Court dated 18-4-1985 in the case of Raj Prakash Chemical [1986 (2) SCC 297 = 1987 (30) E.L.T. 45 (SC)] stated that the Court has no occasion to consider the significance of the words whether canalised or otherwise mentioned in the Order dated April 18,1989 because that point did not arise in the case before it. Further, it was clarified that importer could be entertained to import items whether canalised or not, if the import policy prevailing at the time of import permitted him to import items falling under each category. In view of the observations made by the Hon ble Supreme Court and respective High Courts it is clear that validity of license is to be considered in terms of policy when license was issued as well as policy when actual import effected. In the instant case the licenses were issued in 88/89 whereas the actual import is effected on 28-1-1990 for the license to be treated as valid, it should not only cover the goods which were permissible to be imported from the policy during which the license was issued, but also it should be valid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntended by him that different model (3022) Condensor that too for supply of small quantity cannot be compared with the importation of consignment in question as it was resorted to by the Collector at the first instance. He said that the comparison of the value of the goods should be same in respect of physical characteristic, quality, reputation, country of origin and timing of the import. He referred to the decision of the Tribunal in the case of PAC System (P) Ltd. v. Collector of Customs, Bombay - 1992 (58) E.L.T. 131 (Tri.) = 1991 (37) ECR 647 wherein it was held that there is no justification in enhancing the value on the basis of transaction value of identical goods since there is difference of six months between the two imports. 8. He submitted that it is well settled principle of law that burden lies on the Department to prove the under-valuation by referring to the series of decisions and said that burden has not been discharged by the Department in this case. He doubted the genuineness of the fax copy of said quotation which was mainly relied upon by the Department. He pointed out number of descrepancies in the said quotation including dates and said that source was nei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndon Vikas (India) Ltd., Madras and prices of the models imported by the party, transaction value cannot be accepted and there is nothing wrong in relying upon the quotation price list of the regular supplier to determine value of the goods for the purpose of assessment. He also drew our attention to the para 11 of the judgment in the case of Photo Copy Centre v. Collector of Customs - [1991 (56) E.L.T. 801] and para 8 of the judgment in the case of Shiva Shakti Enterprises v. Collector of Customs - 1991 (52) E.L.T. 439 in support of his contention that declared price cannot be said to be transaction value and the question of its acceptance does not arise. The value could not be determined under Rule 5 to Rule 7 in this case and hence the Collector adopted the residual method prescribed in Rule 8(1). He said that mens rea is not an essential ingredient for the purpose of imposition of redemption fine as well as penalty relying upon the ratio of the decision in the case of Nizam Sugar Factory Ltd. v. Collector of Central Excise of Others - 1987 (27) E.L.T. 40 (A.P.) and Goodyear India Ltd. v. Collector of Central Excise -1990 (48) E.L.T. 394. 10. On going through the submissions m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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