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TMI Blog2005 (6) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... ported goods is to be determined u/s 14(1)(A) in accordance with the Customs Valuation (Determination of Price of Imported Goods), Rules, 1988. The 'special circumstances' have been statutorily particularised in Rule 4(2) and in the absence of these exceptions, it is mandatory for Customs to accept the price actually paid or payable for the goods in the particular transaction. In the present case, in my view, there are no 'special circumstances' warranting rejection of the transaction value. Hence, I propose to allow the appeal. As per by the Member (Judicial) Dr. S.L. Peeran - The valuation of the subject goods is governed by the Customs Valuation Rules, 1988. These very rules had fallen for examination by the Apex Court in the case of Eicher Tractors [ 2000 (11) TMI 139 - SUPREME COURT] . The Apex Court rejected the Revenue's contention that Rule 4(1) allowed the ordinary international value of the goods to be ascertained on the basis of data other than the price actually paid for the goods. Their lordships, further, held that, in terms of Section 14(1) and Rule 4, the price paid by an importer to the vendor in the ordinary course of trade shall be taken to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case. There was no Show Cause Notice issued nor there was an allegation that the contract price has not been given effect to and extra money has been paid to other source. Therefore, the learned Counsel submits that the Eicher Tractor ruling of the Apex Court is required to be accepted in the present case. It is his contention that the Calcutta High Court, in the case of Sneha Traders Private Ltd. v. CC - 1992 (60) E.L.T. 43 (Cal.) also held that price as prevalent at the time of contract is required to be accepted and subsequent price increase at or near the time of shipment or importation is irrelevant. He further relies on the judgment rendered by the Tribunal in the case of Vision Trade Links v. CC, Nagpur - 2004 (169) E.L.T. 151 (Tri. - Del.) wherein also the enhancement valuation was set aside on the ground that no evidence was produced by Revenue to show that transaction value between the parties was influenced by any consideration other than commercial consideration. 2. The learned JDR pointed out that the department can reject the transaction value and can rely on contemporaneous evidence to show that the invoice value is not the correct value and in this conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... geable on any goods by reference to their value, the value of such goods shall be deemed to be - (a) the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation, or exportation as the case may be, in the course of international trade, where the seller and the buyer have no interest in the business of each other and the price is the (sole) consideration for the sale or offer for sale; (b) Where such price is not ascertainable, the nearest ascertainable equivalent thereof determined in accordance with the rules made in this behalf . 6. A perusal of the said provisions contained in Section 14(1)(a) shows that for payment of customs duty the value of the goods is:- (i) the price at which such or like goods are ordinarily sold or offered for sale, (ii) for delivery at the time and place of importation and exportation as the case may be, (iii) in the course of international trade, (iv) where the seller and the buyer have no interest in the business of each other and price is the sole consideration for the sale or offer for sale. 7. This means that the value of the goods is to be ascertained on the basis of the price at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich were imported from the same supplier at about the same item as import of goods by the appellant. The date of shipment of the goods imported by M/s. Hibotex Pvt. Ltd. was June 25, 1988 and the date of arrival of the goods was August 4, 1988 while in respect of the goods imported by the appellant the date of shipment was June 18, 1988 and the date of arrival was July 26, 1988. There was a difference of about a week only between the dates of shipment and dates of arrival of goods in the said imports. The price of the goods imported by M/s. Hibotex Pvt. Ltd. could, therefore, provide the basis for assessing the value of the goods imported by the appellant. The price of the goods imported by M/s. Hibotex Pvt. Ltd. was 7,00,000 Japanese Yen per se. Having regard to the fact that the appellants had contracted for a larger quantity the Additional Collector has allowed quantity discount of 1,00,000 Japanese Yen per se on the basis of the letter of suppliers dated September 7, 1988 and he assessed the value of the goods at 6,00,000 Japanese Yen per se. The said assessment has been upheld by the Tribunal. We do not find any infirmity in the said approach of the Additional Collector. In th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upplier defaults. Thereafter, on 31st July 2001, the parties agree for extending the time for delivery till September 2001. On 10-8-2001, the first consignment of 500 MT was cleared by Bill of Entry at 428 USD per MT. On 29-9-2001, the last consignment of 500 MT was sought to be cleared at the same rate. Since in the same vessel, another consignment of identical goods were supplied at 485 US D per MT, the Revenue initiated action against the appellant for differential duty on the ground that there is a contemporaneous value at 485 US D per MT. 6. From the above facts, it is clear that the transaction value in respect of the appellant is only 428 US D per MT. If we have to reject the transaction value, the transaction should fall under any one of the instances enumerated in Rule 4(2). In my view, none of the instances enumerated in Rule 4(2) is applicable to the present case. The value of 428 US D per MT has been arrived at purely on commercial considerations based on contracts. The supplier, in order to honour the contract, supplied the goods at the contracted price. There is also no allegation that the appellant paid to the supplier more than the contracted value. Under these circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellants under Bill of Entry dated 29-9-2001. At this stage, the department sought to enhance the assessable value of the goods to US D 485 per MT on the basis of a contemporaneous import. In the vessel which brought the second consignment of crude sunflower oil to the appellants, there was another consignment of 500 MTs of identical goods supplied at the rate of US $ 485 per MT to another importer viz. M/s. Priyanka Refineries Pvt. Ltd. It was this import by M/s. Priyanka Refineries Pvt. Ltd. that was adopted as 'contemporaneous import' for the purpose of assessment of the appellants' goods. The issue before me is whether it was open to the department to reject the transaction value of the subject goods and adopt the value of the contemporaneously imported goods. 10. Heard both sides. Ld. Counsel for the appellants and ld. SDR for the Revenue reiterated their respective arguments. Ld. Counsel mainly relied on the Supreme Court's judgment in Eicher Tractors Ltd. v. CC, Mumbai, 2000 (122) E.L.T. 321 (S.C.) and submitted that it was not open to the Customs authorities to reject the transaction value solely on the ground that a higher value was available from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of trade shall be taken to be the value in the absence of any of the special circumstances indicated in Section 14(1) and particularized under Rule 4(2). The special circumstances particularized under Rule 4(2) were also reproduced in the Apex Court's judgment and the same are as under :- (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 by law or by the public authorities in India; or (ii) limit the geographical area in which the goods may be resold; or (iii) do not substantially affect the value of the goods; (b) the sale or price is not subject to same condition or consideration for which a value cannot be determined in respect of the goods being valued; (c) no part of the proceeds of any subsequent resale, disposal or use of the goods by the buyer will accrue directly or indirectly to the seller, unless an appropriate adjustment can be made in accordance with the provisions of Rule 9 of these rules; and (d) the buyer and seller are not related, or where the buyer and seller are related, that transaction value is acceptable for customs purposes under the provisions of sub-rule (3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to do with the Customs Valuation Rules, 1988 as rightly noted by learned Member (Technical) of the regular bench. There is no parallel between the instant case and the case of Rajkumar Knitting Mills (supra) insofar as the valuation issue is concerned. Hence, in my considered view, the Apex Court's decision in Rajkumar Knitting Mills (supra) is of no aid to the Revenue in the present case. As regards the Supreme Court's judgment in Punjab Processors (supra) cited by ld. SDR, I note their lordships' observation that, while the Customs authorities, in assessing the value of import, are not bound by the figure mentioned in the invoice, they can rely on contemporaneous evidence to show that the invoice price is not the correct value. In the instant case, it was not the invoice alone but also the contract between the appellants and their supplier that provided the transaction value of the subject goods and the Customs authorities had no reason whatsoever to reject this value. Thus the Revenue cannot claim effective support from Punjab Processors (supra). 14. For the reasons already noted, I hold that the transaction value of the subject goods requires to be accepted, in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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