9911796707
TMI Blog1993 (7) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeals after condoning the delay caused by the pendency of the writ petitions. These 3 appeals are, therefore, taken up on record for disposal notwithstanding the delay in filing of the appeals. 3. The prayer made in the Stay Applications is as under : (a) stay the order of confiscation of the said goods, (b) waive the pre-deposit of the differential duty demanded in the impugned order and also the penalty imposed and stay the recovery during the pendency of the appeal, (c) to direct the Respondent to immediately allow the clearance of the said goods at the value declared in the bill of entry, and (d) such other interim relief as this Hon ble Tribunal may deem fit in the facts and circumstances of the case. 4. The learned Advocate for the applicants pleaded that the applicants have become victim of circumstances and for no fault of theirs and without any basis in law have been called upon to pay higher differential duty over and above the value as declared by them and the applicants goods have been confiscated for reason of mis-declaration of value and allowed redemption on payment of fines and also penalties have been imposed on the applicants as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... valuation. He pleaded that the lower authority has relied on the sole evidence of this telex, without verifying the basis on which this telex was sent and without taking note of the fact that this telex was exchanged between the Charterers and the owners of the vessel, who were neither the buyers of the wood nor the importers. He pleaded that the learned lower authority has not even tried to find out as to whether this price of US dollars 420 per cbm. reflected the market rate of retail price. He pleaded that the Charterers indicated this approximate price to the Master of the vessel in connection with their dispute regarding excess cargo and in case there was any excess this value was indicated to the Master to hold back that much of cargo of wood as would cover the excess freight that would become payable in case there was any excess. He pleaded that under the Customs Act under Section 14 under which a detailed procedure by way of Valuation Rules exists for arriving at the assessable value, the value reflected in this telex of the Charterers could not be adopted as the basis for arriving at the assessable value. This telex of the Charterers giving an approximate value, he pleaded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction taken by the learned lower authority is that the goods have been shipped from Trinidad and the invoice for the goods produced is from a seller in Hongkong. He pleaded that this is normal in the wood trade and most of the deals in this commodity for imports to India are through dealers in Hongkong. He pleaded, however, if for any reason this invoice of the applicants was not acceptable as reflective of the transaction value, the learned lower authority should have statutorily proceeded to determine the assessable value in terms of the rules referred to supra by proceeding sequentially through Rules 5 to 8 of Valuation Rules as provided under Rule 3 reproduced supra. He pleaded that the learned lower authority has given a go-by to this legal requirement and has straightaway held that the approximate value as contained in the telex sent by the Charterer to the Master of the vessel reflected the correct price for the import of the goods into India. He pleaded that the applicants before the learned lower authority had taken a plea that the value of the similar goods could be verified for the purpose of satisfying that the value declared by the applicants was correct and he pleaded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned lower authority and in the facts and circumstances of the case dispensation of the pre-deposit of the differential duty and penalty levied. 3. Shri J.P. Gregory, the learned SDR generally adopted the reasoning of the learned lower authority in the impugned order and pleaded that the learned lower authority has relied upon for the purpose of enhancing the value of the goods the telex sent by the Charterers to the Master of the vessel. He pleaded that both the Charterer and the Master had connection with the goods even though as carriers and they are expected to know the details regarding quantum and value of the goods. He pleaded that it is not as if these people were not at all having any concern with the goods and inasmuch as they were closely connected with the transaction of the import of the goods in their hands, it could be relied upon as evidence and this is what the learned lower authority has done in the impugned order. He pleaded that the appellants have not specially taken the stand for the purpose of asking the basis for the value reflected in the telex. Intervening at this stage, the learned Counsel for the appellants referred to the relevant portion of the repl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appellants which shows the unit price as US $ 320 cbm as reflected in the invoice of AB Doololly Ebrahim Co. Hongkong Ltd., Hongkong. The learned lower authority has taken note of the fact that while the goods have been loaded at the port of Spain in the name of one importer, the same came to be re-invoiced in Hongkong in the name of different importers who are the appellants before us and has drawn the following inference as set out in para 21 of the impugned order: The fact that the goods were originally consigned to Purushotham Gokuldas Plywood Co. Ltd, Bunder, Mangalore from Port of Spain and then after reaching Hongkong fresh bills of lading were got issued on the basis of the manifest that were prepared. The manifest filed by the steamer agent at Mangalore also took into consideration the high sea sales made by the consignees and which fact also entered in the Bills of Entry, only goes to show the method adopted to cover up the changes effected in the value of the goods. There is also no rational explanation as to how the consignee s name Purushotham Gokuldas as shown in the manifest originally got changed to others at Hongkong to : Mangalore. ...By doing so, they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ither the sellers nor the buyers of the goods. Therefore the criteria under which this telex has been issued is beyond the ambit and the scope of the term in the normal course of international trade ." We observe that the learned lower authority was duty bound to enquire into the basis on which the Charterer had shown the value of the goods as US $ 420 per cbm. We observe that the Charterers and the owners were only concerned with the carriage of the goods. There is no evidence on record to show that they were privy to any negotiations regarding the price of the goods for import into the country. The least the learned lower authority could have done was to enquire with the senders of the telex as to the basis on which they had indicated this price viz. US $ 420 per cbm., which was also mentioned as approximate. The use of the word approximate itself should have alerted the learned lower authority to the fact that the sender of the telex was not sure as to the exact price of the goods. This price could be the market price of the goods in Indian market or might even contain certain other elements which do not partake the character of value under Section 14 of the Customs Act, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessable value under Section 14. The relevant extract from the said decision is reproduced below : The value under Section 14 is deemed value. It is deemed to be the price at which such or like goods are ordinarily sold... It is settled that invoice price need not necessarily be deemed value, Calcutta Motor Dealers Association v. CC [1989 (42) E.L.T. 693 = 1989 (23) E.C.R. 597 (Cegat SB-A)] provided another international price available to all parties is normally....exists . In other words the appellants should be able to prove that the invoice price does not represent the price at which the goods are ordinarily sold, and it does not represent the price, as seller and buyer have interest in the business of each other and the price is not the sole consideration for the sale or offer for sale. It is also equally settled that the burden of proving the charge of undervaluation lies squarely on the deptt. The charge of under-invoicing has to be supported by an evidence of right kind of goods Maheshwari Trading Corpn. v. CC, New Delhi [1987 (29) E.L.T. 739 (Tribunal) = 1985 ECR 973]; Walia Enterprises, Amritsar v. Collector of Customs [1987 (32) E.L.T. 774)]; CC v. Automoti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or of Customs, Bombay) we do not think they support the Department s case in any way. They are telex messages exchanged between parties and the quotations contained in the said telex messages have not been correlated with any actual importations made into India at prices mentioned in these messages. Taking the documentary evidence as a whole, we are of the view that the Department has been unable to satisfy us that the appellants resorted to under-valuation. The appellants have also pressed into service the ruling of the Special Bench in the case of Kumar Associates v. Collector of Customs, referred to supra, in support of their plea that determination of the value of the goods should be done sequentially through Rules 5 to 8 of the Customs Valuation Rules, 1988. Para 10 of the judgment is reproduced below: 10. We find that in regard to the valuation of driers and FICD, the adjudicating authority had resorted to Rule 7 and determined the value on the basis of the market price at which similar goods were being sold in the country after importation. In this regard it would be relevant to refer Rule 3 of the Customs Valuation (Determination of the Price of Imported Goods) Rules, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned lower authority that it was the normal practice in the trade to import these goods through their agents in Hong Kong and Singapore etc. We observe that the learned lower authority has not adverted to these pleas of the appellants while drawing adverse inference against them. The least that could have been done was the authorities should have made enquiries in the market in this regard and more so when the learned lower authority has relied heavily on this circumstance. In regard to the excess goods, the learned lower authority, as rightly pointed out by the appellants, has not allocated the same to any particular importer and unless that was done no adverse inference could be drawn against any importer in this regard. We observe that this is a case where an enquiry was done on suspicion that the goods carried in the vessel were double of what was manifested and as a result of the proceedings in regard to the same, the goods were measured pole by pole and the excess which came to be found was only 276.324 cbm. Even here, the appellants have given explanation that it was the practice in the trade to give allowance for the bark and the sap. The learned lower authority has not ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
