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TMI Blog1995 (6) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... so impose a penalty of Rs. 1,00,000/- (rupees one lakh only) on M/s. Pan Asia Enterprises under Section 112(a) of the Customs Act, 1962." 2. Briefly stated the facts of the case are that appellants imported two Canons Colour Laser Copiers CLC 300 with accessories; and declared the value as Rs. 2,76,074/- and Rs. 2,54,290/-. It was observed by Customs that the goods have been imported from Traders. On examination of the goods, they were found to be manufactured in Japan by M/s. Canon. As the goods were imported from a trader in Singapore, the importers were asked to produce manufacturer's invoice, price list as per Rule 10(1)(b) of the Customs (Valuation) Rules, 1988. The importers could not produce the manufacturer's invoice or price list. 3. On an enquiry and investigation the customs authorities found that proforma invoice dated 2-3-1993 of M/s. Eight Fortunes Ltd., Hongkong drawn on M/s. Rohit Enterprises, Ahmedabad showed that the price of Canon Colour Laser Copier CLC 300 was quoted at HK $ 1,68,000/- (FOB) (Rs. 7,06,476)/-. It was also found by the Customs on a scrutiny of the documents that M/s. Canon Inc., Japan is the manufacturer of the goods CLC 300 and M/s. Canon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the practice of the Deptt. not to insist on manufacturer's invoice; that it was not the intention of Rule 10 of Customs Valuation Rules, 1988 that manufacturer's invoice should be produced in each and every case; that there was nothing alarming with the FOB price of the Singapore party and the CIF price of the Indian importer was the same inasmuch as the Singapore exporter had borne the insurance and freight out of the 10% commission that it got from Singapore supplier of the goods; that the freight and insurance in the instant case amounted to Rs. 510/- per piece; that Rule 4 of the Customs (Valuation) Rules, 1988 was self-contained and the cir- cumstances under which the transaction value can be discarded are specified in sub-rule (2) of Rule 4. That in the instant case, those circumstances were not applicable; that the judgment of Honourable Calcutta High Court relied on by the respondents is not applicable to the facts of the present case; that the case Gapp's Industries relied upon by the respondents pertains to Customs Valuation Rules, 1963 whereas their case pertains to Valuation Rules, 1988; that there was no legal basis for enhancement of the value as ordered; that the Col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvoice of M/s. Eight Fortunes Ltd., Hongkong. In support of his contention the ld. DR cited and relied upon the ratio of judgment in the case of Atmaram Agarwalla reported in 1992 (60) E.L.T. 217 wherein the Hon'ble Calcutta High Court had held that it cannot be said with certainty at this stage whether the transaction value would be increased by any amount on account of any commission or brokerage paid or payable by the petitioner to the foreign seller. The customs officers have applied Rule 5 by determining the value of imported goods on the basis of the value of identical goods for export to India. Therefore, the assessment order is justified. 8. It was also argued by the ld. DR that in the case of Gapps's Industry reported in 1992 (60) E.L.T. 305, this Tribunal had held that price quotation by itself is sufficient basis for determining assessable value under Rule 3(a) of Customs (Valuation) Rules, 1963; that in the case of Wax and Wax Products - [1990 (48) E.L.T. 421], this Tribunal had held that the value based on price list of the foreign supplier available with local agents represents the correct value of the goods, the ld. DR also referred to the ratio of the judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s when compared with manufacturer's price list was much below the normal price in the international market. The goods were directed to be confiscated with an option to clear on Rs. 8 lakhs. Penalty of Rs. 1000/- was also imposed. Against this order the appellant approached the Tribunal. The Tribunal found that the Collector did not commit any error in applying Rule 3(b) but reduced the redemption fine from Rs. 8 lakhs to Rs. 5 lakhs. The penalty of Rs. 1,000/- was maintained. 3. Section 14(1)(b) of the Customs Act empowers the appropriate authority to determine the value of the imported goods in accordance with provisions contained in Rules 3 to 8. Rule 3(a) provides for determination of value of such goods, with comparable goods produced or manufactured and ordinarily sold or offered for sale to other buyers in India under competitive conditions. Rule 3(b) permits the proper officer to determine valuation on the export price at which such goods or comparable goods are ordinarily sold or offered for sale under competitive conditions to buyers outside India. The determination under Rule 3(b) could be undertaken if the valuation could not be determined under clause (a). The aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d., Hongkong in respect of the copiers and other items imported alongwith their application for approval of their phased manufacturing programme. The company itself having produced these quotations, they cannot dispute the correctness of the prices mentioned therein. The company has not only not disputed the correctness of these quotations but has not produced any other material on record to show that the value mentioned in the invoices was the correct market value of the goods imported at the relevant time. The adjudicating authority in these circumstances was perfectly justified in taking the prices mentioned in the quotations as a basis for determining the correct value of the imported goods." In the case of Debabrata Ghosh reported in 1993 (68) E.L.T. 551, the Hon'ble Calcutta High Court held : "7. The question, therefore, is what should be the starting point of valuation of the imported car. Should the valuation be done on the basis of the list price of the manufacturer which is the price of a new brand car at which the car is sold or alternatively, as Mr. Gupta has suggested, the starting point should be the auction price of the car which price was actually paid by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in competitive conditions in countries outside India, the order does not suffer from any error of law. The Tribunal further, did not commit any error in relying on the price list supplied by the manufacturer as compared to trading company which refused to divulge the name of manufacturers. The position is further made clear in the judgment in the case of Debabrata Ghosh that there is no conflict in Rule 8 and Section 14. So also can be said that there is no conflict in Valuation Rule 4 of 1988 and Section 14 of the Customs Act, 1962. On the other hand Rule 4 becomes applicable subject to the provisions of Section 14 of the Customs Act, 1962. 13. The ld. Consultant for the appellants has referred to the decision of the Tribunal in the case of PAC Systems reported in 1992 (58) E.L.T. 131 wherein the Tribunal had discussed various provisions of Rule 4 of the Customs Valuation Rules, 1988 and submitted that in the instant case, the consignment was imported in 1992 and therefore only Customs (Valuation) Rules, 1988 will be applicable. It was also impressed by the ld. Consultant that all the decisions cited and relied upon by the respondents pertain to Customs (Valuation) Rules, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of importation or exportation, as the case may be, in the course of international trade, where the seller and buyer have no interest in the business of each other and the price is the sole consideration for the sale or offer for sale : [Provided that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented under Section 46, or a shipping bill or bill of export, as the case may be, is presented under Section 50;] (14) subject to the provisions of sub-section (1) the price referred to in that sub-section in respect of imported goods shall be determined in accordance with the rules made in this behalf." 15. Admittedly, the imports in this case took place after framing of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988. In Rule 3 of the said Rules it has been provided : "3. Determination of the method of valuation. - For the purpose of these rules - (i) the value of imported goods shall be the transaction value; (ii) if the value cannot be determined under the provisions of clause (i) above, the value shall be determined by proceeding sequentially through Rules 5 to 8 of these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een taken up, as transaction value were identical goods or not, we find that quotations referred to pertained to identical goods of the same specification produced in Japan namely the same country of origin by the same manufacturer namely, M/s. Canon. We therefore find that the quotation were for identical goods. While discussing case law cited (supra) it has already been well settled principle of law that quotation for identical goods can be accepted to determine the transaction value for the purpose of assessment under Section 14 of the Customs Act, 1962 read with the Customs Valuation Rules, 1988. In this view of the matter, we hold that in the instant case, the transaction value shown in the invoice and declared in the bill of entry has rightly been rejected and that the other value has been accepted in terms of the Customs Valuation Rules, 1988. 19. Having crossed the hurdle created by the learned consultant that the only Rule which governed price was Rule 4 of the Customs Valuation Rules, 1988, we now proceed to determine the correct assessable value of the imported goods from the evidence on record. We find that the Revenue relied upon the quotation from M/s. Jardine M ..... X X X X Extracts X X X X X X X X Extracts X X X X
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