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TMI Blog2019 (4) TMI 1093X X X X Extracts X X X X X X X X Extracts X X X X ..... essing officer. If the case of the revenue was that contemporaneous imports were at higher price, could they have proceeded without referring to NIDB maintained by the revenue itself. Without even referring to their own database both adjudicating authority and Commissioner (Appeal) have rejected the declared value on the basis of the certain emails which were not with the reference to imports under consideration. Appeal allowed - decided in favor of appellant. - APPEAL Nos. C/559,560/2012 - A/88327-88328/2018 - Dated:- 6-12-2018 - Mr. S.K. Mohanty, Member (Judicial) And Mr. Sanjiv Srivastava, Member (Technical) Shri Anil Balani, Advocate, for appellant Shri Manoj Kumar, Assistant Commissioner (AR), for respondent ORDER Per: Sanjiv Srivastava These appeals are directed against the order in appeal No 174 175 (Adjudication Import)/2012 (JNCH)/IMP-148 149 dated 30.03.2012, of the Commissioner Custom (Appeal) Nhava Sheva. By the said order Commissioner (Appeal) has held as follows: I reduce the penalty imposed on the appellant no 1 under Section 114A to ₹ 2,41,673/- and hold that appellant is entitled to avail the benefit of first prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Target Plus License. 2.2 Subsequently on the basis on intelligence and information developed to effect that importers had short paid the duty on the said imported consignment by misdeclaring the value, Office and Residential premises of the importers were searched by the officers of DRI. The consignment of Disperse Dyes of China, imported against the said Bill of Entry and found in business cum office premises of the importer was detained under panchnama dated 25.04.2009 and subsequently seized vide DRI F No 856(12)LDH/2009/Pt-I/2423 dated 09.10.2009. 2.3 Investigation was undertaken and statements of various person recorded under Section 108 of Custom Act, 1962. On completion of investigations a show cause notice dated 23.04.2010 was issued to the importers alleging misdeclaration of value with intent to evade payment of duty. Show Cause Notice proposed for confiscation of goods seized demanded duty and interest and proposed penalty on the importers. 2.4 The show cause notice was adjudicated by the Additional Commissioner of Customs, JNCH as per his order referred in para 1, supra. 2.5 Aggrieved Appellants preferred an appeal before Commissioner (Appeal), which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value declared by them was as per the sale contract. Hence there is no justification what so ever for rejection of the declared value, or for confiscation of goods. Hence the order of Commissioner (Appeal) is bad in law and needs to be set aside. 4.3 Arguing for the revenue learned Authorized Representative, reiterated the findings of the lower authorities. He justified the rejection of declared value application of Rule 12 and for the reason of misdeclaration confiscation of goods under Section 111(m). 5.1 We have considered the submissions made in the appeal and during the course of argument. 5.2 Adjudicating authority in his order in original running into 18 pages have devoted 15 pages to reproduce the averments made in show cause notice, one page in recording the submission of the noticee and thereafter recorded the findings in less than a three quarter of page as follows: I have gone through the documents on record and heard the Advocate of the Importer carefully. The SCN was based upon certain relied upon documents including the email dated 13.08.08 from Yin Lifeng to Vish @ 1 Deora regarding the price of disperse dyes based on 25 Kgs carton, email dated 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Customs Valuation Rules 2007. 5.3 This order has been upheld by the Commissioner (Appeal) and the appellants are in appeal before us. We do not know what was consideration of the evidence and submissions made by the appellant which lead to rejection of the declared value by the Appellants. Rejection of declared value on Bill of Entry is a serious affair and the same could have been rejected on the basis of cogent examination of evidences and justifiable reasons. Hon ble Supreme Court has in case of Eicher Tractors [2000 (122) ELT 321 (SC)] laid down very categorical as follows: 6. Under the Act customs duty is chargeable on goods. According to Section 14(1) of the Act, the assessment of duty is to be made on the Value of the goods. The value may be fixed by the Central Government under Section 14(2). Where the value is not so fixed the value has to be determined under Section 14(1). The value, according to Section 14(1), shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation - in the course of international trade. The word ordinarily necessarily implies the exclusion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -rule (3). 9. These exceptions are in expansion and explicatory of the special circumstances in Section 14(1) quoted earlier. It follows that unless the price actually paid for the particular transaction falls within the exceptions, the Customs authorities are bound to assess the duty on the transaction value. 10. The respondent s submission is that the phrase the transaction value read in conjunction with the word payable in Rule 4(1) allows determination of the ordinary international value of the goods to be ascertained on the basis of data other than the price actually paid for the goods. This, according to the respondent, would be in keeping with the overriding effect of Section 14(1). We cannot agree. 11. It is true that the Rules are framed under Section 14(1A) and are subject to the conditions in Section 14(1). Rule 4 is in fact directly relatable to Section 14(1). Both Section 14(1) and Rule 4 provide that the price paid by an importer to the vendor in the ordinary course of commerce shall be taken to be the value in the absence of any of the special circumstances indicated in Section 14(1) and particularised in Rule 4(2). 12. Rule 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermined the transaction value under Rule 4 at the price actually paid by the appellant for the 1989 bearings. Naturally, if Rule 4 applies to the facts of this case, the Assistant Collector's reasoning under Rule 8 must, by virtue of language of Rule 3(ii), be set aside. 16. The Assistant Collector appears to have proceeded on the law as it was prior to the 1988 Rules when special considerations on the basis of which a transaction was held not to be an ordinary sale in the course of international trade within the meaning of Section 14(1), had not been statutorily particularised. 17. As to what would constitute such special consideration has been considered in several decisions of this Court. For example, a special quotation for the importer singling him out from other importers in India was held to be a special consideration in Padia Sales Corporation v. Collector of Customs, Bombay (supra) justifying the rejection of price paid as the transaction value. On the other hand in Basant Industries v. Addl. Collector of Customs, Bombay - 1996 (81) E.L.T. 195 (S.C.), a special quotation for an old and valued customer was upheld as not being a special. 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansaction value. This was erroneous and could not be a reason by itself to reject the transaction value. A discount is a commercially acceptable measure, which may be resorted to by a vendor for a variety of reasons including stock clearance. A price list is really no more than a general quotation. It does not preclude discounts on the listed price. In fact, a discount is calculated with reference to the price list. Admittedly in this case discount up to 30% was allowable in ordinary circumstances by the Indian agent itself. There was the additional factor that the stock in question was old and it was a one time sale of 5 year old stock. When a discount is permissible commercially, and there is nothing to show that the same would not have been offered to any one else wishing to buy the old stock, there is no reason why the declared value in question was not accepted under Rule 4(1). 23. In the circumstances, production of the price list did not discharge the onus cast on the Customs authorities to prove that the value of the 1989 bearings in 1993 as declared by the appellant was not the ordinary sale price of the bearings imported. 5.4 Similar view has been express ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... comparable commercial transaction were assessed; (b) the sale involves an abnormal discount or abnormal reduction from the ordinary competitive price; (c) the sale involves special discounts limited to exclusive agents; (d) the misdeclaration of goods in parameters such as description, quality, quantity, country of origin, year of manufacture or production; (e) the non declaration of parameters such as brand, grade, specifications that have relevance to value; (f) the fraudulent or manipulated documents. From plain reading of the rule 12 it is quite evident that the word doubt used in the rule do not refers to the doubt of a doubting Thomas, but said doubt has to be based on cogent reasons and evidences. No cogent evidence or reason has been put forth in the present case to justify the doubt of the assessing officer. If the case of the revenue was that contemporaneous imports were at higher price, could they have proceeded without referring to NIDB maintained by the revenue itself. Without even referring to their own database both adjudicating authority and Commissioner (Appeal) have rejected the declared value on the basis of the certain em ..... X X X X Extracts X X X X X X X X Extracts X X X X
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