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TMI Blog2006 (6) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty under Section 112 was imposed on all the three appellants and a bank guarantee was ordered to be appropriated to recover the duty and penalty leviable on M/s. Shri Ram Fibres. 2. Briefly stated, three Bills of Entry were filed by M/s. Shri Ram Fibres, declaring the goods as synthetic wastes, which on testing by the Chief Chemist, CRCL turned out to be Synthetic Filament Tow (Acrylic) / Synthetic Staple Fibre not carded, combed or otherwise processed for spinning . The test reports clearly indicated that the samples were free from undrawn, fused filaments and other extraneous matter and the filaments were of uniform diameter and composed of acrylic. In addition to this, a copy of packing list filed for customs clearance along with copies of labels fixed on the bales were also recovered by the Department. The seized labels contained details like, dimension of the bales, gross weight and net weight in Kgs and lbs of the bale, specification of the material ( Acrylic ), type code, total denierage, total kilotex, denier DPF, denier decitex of the materials, date of production of the material, package no. (which incidentally conformed with the one mentioned in the packing list ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellants, but as Acrylic Fibre falling under Heading 5503.30. 6. As regards the two Bills of Entry declared as staple fibres and whose valuation was in dispute, the learned Commissioner held that the assessable value of the said consignment should be arrived at by taking CIF value @ US $ 1.75 per kg. and adding bank charges @ 2.25% and high sea sales commission @ 2%. While arriving at this value, the Commissioner took into account the value of contemporary imports made by other importers from the same foreign supplier i.e. M/s. Bollag International Corpn., USA, but through other ports. 7. The impugned order also hinges on the packing lists recovered by the Department from each and every bale all describing the goods as acrylic fibre . The copies of the same were, however, forwarded by the investigating officers to the Bombay Office of M/s. Monsanto Co. of USA to verify whether the material covered by the packing list and the labels were actually manufactured by the said supplier in the USA and sold by them and if so what actually were this material and what did the code mentioned in the labels revealed. The clarification received from the Bombay Office of the said supplier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... old-shouldered by the Commissioner on the ground that the said letter did not refer to those invoices which were actually raised by M/s. Monsanto to M/s. Bollag International. As regards the other two Bills of Entry where the party had declared the goods as staple fibre but valued at US $ 1.00 per kg, the transaction between M/s. Bollag International and M/s. Radiant Synthetic Industries was not considered at arms length by him. 8. The learned counsel for the appellants asserts that the Chief Chemist s report is incomplete, inadequate and not reliable. The major annoyance according to him, was that the report was silent about the specific denier and that all the parameters, laid down in the tariff heading concerning the fibre were never discussed in detail. 9. The learned counsel also contended that the Department did not consider the veracity of the piece of evidence (letter dt. 3-4-96) produced by them from M/s. Monsanto who had supplied their goods to Bollag International. This letter has clearly indicated that the quality of the product supplied by them was not a quality Monsanto product and that what was dispatched was off quality reject material . 10. The learned cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R vehemently argued that the report contained all relevant details needed to confirm that the goods imported were not wastes. 16. He also referred to the construction of Chapter Heading 55.05 pertaining to wastes to drive home the point that by no stretch of imagination, the test report can be interpreted to convey that the goods tested could fall under this: 55-05-WASTE (INCLUDING NOILS, YARN WASTE AND GARNETTED STOCK) OF MAN-MADE FIBRES. 5505.10 - Of synthetic fibres 5505.20 - Of artificial fibres This heading covers waste of man-made fibres (filaments and staple fibres - see the General Explanatory Note to Chapter 54) and includes: (1) Fibre wastes (soft waste), such as relatively long fibres obtained as waste during the formation and processing of filaments; short fibres obtained as waste from the carding, combing and other processes preparatory to the spinning of staple fibres (e.g., noils, small broken pieces of laps, slivers or rovings). (2) Yarn wastes (hard waste), i.e., broken, knotted or tangled yarns collected as waste during the spinning, doubling, reeling, weaving, knitting, etc., operations. (3) Garnetted stock, i.e., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... report as furnished by CRCL was incomplete, inadequate and hence not reliable. On going through the reference made by the DRI vide their letter dated 29-11-1995, we find that the sample was to be tested to ascertain, whether the same was fibre or waste, and if it was waste, whether it was tow waste, fibre waste, soft waste or hard waste. Considering the specific nature of query, the Chief Chemist reported that the sample of B.Es No. 4977 and 4730 may be considered as synthetic filament tow (acrylic) or synthetic staple fibre, not carded, combed or otherwise processed for spinning and the sample of B.E. No. 5099 as synthetic filament tow (acrylic). The reference made to the Chief Chemist and the report expected from him reminds us of the fitness certificate issued by a physician. When called upon to declare, whether a person is fit or otherwise, all that the medical officer is supposed to say is that the person is medically fit or otherwise, and is not expected to write a monograph on Pathogenesis. Absence of a dissective discourse or dissertation cannot be a ground to discredit the certificate issued by a qualified expert. We have however, found the chemical report complete in all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mist. It may be that in a given case, the report of the Chief Chemist may be demonstrated to be culpably wrong. In such a case, the Court may direct re-examination of the whole issue. But that is not the case here. It has not been shown that the Chemical Examiner or the Chief Chemist were in error in their analysis in any way. The views expressed by the Chief Examiner and Chief Chemist of the Government cannot be lightly brushed aside on the basis of opinion of some private persons obtained by the appellant. 23. We do not find any force in the appellants arguments that the labels found attached to the bales have no relevance to the case. On the other hand, we find that these labels are actually the packing slips and, have brought to light a wealth of information supporting the Department s findings that they were not wastes. The very fact that each label represented a bale and tallied with its contents, as affirmed in the report of the Chief Chemist has rendered credibility to the theory that the appellants have made an unsuccessful attempt to cozen the revenue. The labels have revealed all the particulars of the goods as contained in each and every bale imported. Nowhere in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion issue came into the crucible in the case of M/s. Eicher Tractors, (supra), the Hon ble Supreme Court made the following observations:- 7. The Rules which have been framed are the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988. The rules came into force on 16th August, 1988. Under Rule 3(i) the value of imported goods shall be the transaction value . Transaction value has been defined in Rule 2(f) as meaning the value determined in accordance with Rule 4. Rule 4(1) in turn states: The transaction value of imported goods shall be the price actually paid or payable for the goods when sold for export to India, adjusted in accordance with the provisions of Rule 9 of these rules. 8. Reading Rule 3(i) and Rule 4(1) together, it is clear that a mandate has been cast on the authorities to accept the price actually paid or payable for the goods in respect of goods under assessment as the transaction value. But the mandate is not invariable and is subject to certain exceptions specified in Rule 4(2) namely: (a) there are no restrictions as to the disposition or use of the goods by the buyer other than restrictions which - (i) are imposed or required ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10-1995 and 5059 dated 3-11-1995 which have been found misdeclared as waste for valuation purposes. 30. As regards the penal liability being faced by the appellants under Section 112 of Customs Act, 1962, we find clear evidence that they have violated the said provisions. However, we find that Shri R.K. Goyal, Proprietor of M/s. Radiant Synthetic Industries and his sole proprietory concern, M/s. Radiant Synthetic Industries have both been penalized for the same offence, which in our opinion would be impermissible, both being the same entity. We are, therefore, inclined to set aside the penalty imposed on the sole proprietory concern while confirming it on the sole-proprietor, Shri R.K. Goyal. As regards the quantum of penalty, which is imposed on the remaining two appellants, the same is in our opinion, adequate and sustainable especially considering the nature of offence committed by them. 31. In view of the above, the impugned order is modified in the following manner : (i) The goods attempted to be imported by the appellants as wastes under the three Bills of Entry viz. 4977 dated 31-10-1995, 4730 dated 17-10-1995 and 5059 dated 3-11-1995 have been rightly classified ..... X X X X Extracts X X X X X X X X Extracts X X X X
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