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TMI Blog1997 (11) TMI 288X X X X Extracts X X X X X X X X Extracts X X X X ..... n under Section 111(d) as also Section 111 (m) of the Customs Act, 1962, that the benefit of the notification was not available and that the value of the imported goods was not correctly shown and was liable to be enhanced under Rule 6 of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988. In the show cause notices it was also alleged that penalties were leviable on the Trust and Shri Ramdhari. The Collector after hearing the present appellants passed three orders. In each case he denied the benefit of the notification, held that the goods were not covered under the cited policy, held that the value had been mis-declared. He enhanced the value and confirmed the duty payable as calculated on the enhanced value. He also imposed penalty in each order on both the Trust and Shri Ramdhari. The present appeals arise out of these three orders. 3. The gist of the orders made by the Collector in the three cases are narrated below : (1) Order-in-Original No. 35/KK/96, dated 30-8-1996 I order the confiscation of goods covered under Bills of Entry Nos. 103761 and 103762 dated 7-7-1994, 100750 dated 15-2-1994, 100388 dated 25-1-1994 and 100855 dated 22-2-1994 und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case for the appellants was argued by Shri Ashok Mehta, Advocate. Revenue was represented by Shri Satnam Singh, SDR. 5. Shri Mehta stated that N.S. Charitable Trust was an institution created to bring relief to the poor and the needy without following any limitations of caste or creed. It was argued that the Trust was registered under the Registration of Societies Act. However, in reply to a specific query, he conceded that he could not place before us a copy of such registration. He stated that the goods were free gifts. In support of this statement he relied upon the invoices accompanying the goods in each case. He stated that in the invoices the notional value declared was for customs purposes only. He stated that the invoices bring out the fact that the clothing were meant for free distribution. Some of the invoices also stated that the goods were sent as donation. It was his case that the requirements of both the Customs notification and the relevant paragraph of the Handbook were fulfilled by the importers and that the denial of these provisions was wrong. Without prejudice to these contentions he stated that the Collector s order enhancing the valuation was wrong. Referri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n enhancing the valuation, he supported the Collector s order in adopting the value of import from M/s. Hersatex. On these arguments he fully justified the Collector s findings in confiscating the goods and imposing penalties and also enhancing of the value. 7. We have carefully considered the arguments made by both the sides and have seen the subject notification as well as the relevant paragraph of the Handbook. For ease of reference, the relevant paras of these provisions are quoted below : 98. Subject to compliance with the provisions of any other law for the time being in force, imports may also be made without a licence by the categories of importers specified below, provided the imports do not involve foreign exchange remittances : (v) Foodstuffs, medicines, clothing and blankets received by any charitable organisation as a gift from any philanthropic organisation or individual abroad, for free distribution either by themselves or other charitable organisations to the poor and needy without any distinction of caste, creed or colour;" 8. In their judgment in the case of Mysore Metal Industries reported at 1988 (36) E.L.T. 369, the Supreme Court had held that the burd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In terms of the judgment of the Supreme Court cited above, it is for the importer to establish that the consignors were charitable organisation and that the goods imported were specifically given as free gifts. The citation of the invoices and the contents of the invoices are not sufficient to establish either or both of the requirements of the notification as well as the paragraph in the Handbook. It was submitted by Shri Mehta that the third condition that the goods were meant for free distribution to the poor and the needs without any distinction of caste and creed or race has been satisfied by the appellants in their previous consignments. We are not able to go into the similar imports made in the other cases, further in their judgment in the case of GTC Industries reported at 1997 (94) E.L.T. 9 (S.C.) = 1997 (21) RLT 587, the Supreme Court had held that the contents of one show cause notice should not be looked into for the purpose of adjudicating under another show cause notice. Even if this fact were to be accepted, the appellants have failed to qualify themselves for the first two conditions which have to be satisfied before clearance. In this situation we hold that the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and do not enable us to appreciate as to under what circumstances he preferred one set of valuation over the other. 11. The Valuation Rules prescribe the method to be adopted and contain a number of sequential tests to be applied according to the facts surrounding the goods. If in the sequence it is found that one rule is not sufficient to cope with the task, then the next rule in the sequence can be resorted to. The purpose of the rules is to determine the correct price. Therefore, the Collector would be free to seek guidance from the rule which is most appropriate. In other words, if he finds that Rule 6 is not adequate for the goods before him he may not be procluded from going to the next rule. In the judgment in the case of LVR DANG-IN Stone Limited v. CC, Madras reported at 1994 (72) E.L.T. 377, the Tribunal held that quoting of wrong Section or Rule in the show cause notice or an order was not fatal as long as the nature of violation was correctly brought out. The thought was expressed by the Supreme Court in their judgment in the case of J.K. Steel Ltd. v. U.O.I. reported at 1978 (2) E.L.T. (J 355). The Supreme Court in that order held that if the exercise of the powe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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