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TMI Blog2005 (8) TMI 242X X X X Extracts X X X X X X X X Extracts X X X X ..... on the basis of comparable value of contemporaneous imports are sound and the same fully support the basis of valuation adopted in this case. Moreover, the different methods of valuation, whether based on transaction value, or comparable value (of identical/similar goods), or deductive value based on resale price, or computed value based on cost and profit etc. are designed to arrive at an equitable customs value for the purpose of charging customs duty. The importers cannot have a grievance so long as one of these methods is fairly used, unless he is trying to secure a grossly undue duty advantage as in this case by declaring a value which is 25-30% of the value declared by competing importers importing similar goods. Equity considerations justify levy of duty to the same extent on similar goods. As regards the Advisory Opinion 2.1 of the Technical Committee on Customs Valuation cited by the learned advocate for the appellants, we note that the citation is out of context as in this case Article 1 (Rule 4) method of valuation has been discarded. In any case, the said Opinion recognizes power of the Customs authorities to satisfy themselves as to the truth and accuracy of any decla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned goods at the lowest comparable price of US $ 1860 PMT CIF. The lower appellate authority has passed a detailed order considering all aspects of the case as well as various case laws while rejecting the appellants' claim and upholding the valuation ordered by the lower authority. Hence this appeal. 3. The main thrust of the arguments by Shri V.S. Nankani, learned Advocate appearing for the appellants is that in the absence of any allegation of appellants paying any amount over and above the invoiced price to the suppliers, the declared value should have been accepted by the authorities below for assessment purposes. He further states that in the light of the decision of the Hon'ble Supreme Court in the case of Eicher Tractors Ltd. v. Commissioner of Customs, Mumbai - 2000 (122) E.L.T. 321 (S.C.), the authorities below were required to accept the declared value under Rule 4 of the Customs Valuation Rules, 1988 instead of determining the value under Rule 5 on the basis of comparable goods. He also relies on an extract from the book Customs Valuation Law Practice 2003 to argue that the price below prevailing market price is acceptable as per the Advisory Opinion 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e purpose of assessing the value it is necessary to ascertain the price at which the said or like goods are sold or offered for sale for delivery at the time and place of importation and exportation in the cases of international trade. The words ordinarily sold or offered for sale do not refer to the contract between the supplier and the importer, but to the prevailing price in the market on the date of importation or exportation. The learned S.D.R. contends that in Rajkumar Knitting Mills (supra), the three Judges Bench of the Hon'ble Supreme Court have interpreted Section 14(1) of the Customs Act, 1962 and the same is binding on Courts and Tribunals as words in the said Section 14(1) have not undergone any change till date. (4) In Pan Asia Enterprises v. Collector of Customs, Bombay - 1995 (79) E.L.T. 322 (Tribunal), it was held that declared values are not acceptable if the same are grossly undervalued. This decision of the Tribunal has been upheld by the Hon'ble Supreme Court by dismissing the civil appeal vide Pan Asia Enterprises v. Collector - 1997 (94) E.L.T. A59 (S.C.). (5) Plast Fab v. Collector of Customs - 1993 (66) E.L.T. 441 (Tribunal) has held that valuation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... line with Article VII of GATT and Article VII in Annex I to GATT, to which India is a signatory) requires customs valuation to correspond to ordinary competitive price in international trade. Transaction value method is one of the methods of valuation under the Customs Valuation Rules, 1988 (which follows the Agreement to implement the said Article VII of GATT). The transaction value has been defined to be the actual price paid or payable. The declared value may not represent the transaction value in every case. When the declared value is ridiculously low compared to the ordinary competitive price of comparable goods contemporaneously imported, such declared values cannot be adopted as customs value. In such cases, the transaction value method is clearly inapplicable as the declared value does not conform to the requirement of the said Section 14(1). Valuation by adopting value of comparable goods contemporaneously imported is an equally efficacious method of valuation. Such valuation is also perfectly legal as has been held by the Hon'ble Supreme Court and various Tribunal Benches vide various decisions cited by the learned S.D.R. and listed in Paragraph 4 above. 6. The argume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fy levy of duty to the same extent on similar goods. 8. As regards the Advisory Opinion 2.1 of the Technical Committee on Customs Valuation cited by the learned advocate for the appellants, we note that the citation is out of context as in this case Article 1 (Rule 4) method of valuation has been discarded. In any case, the said Opinion recognizes power of the Customs authorities to satisfy themselves as to the truth and accuracy of any declaration made by the importers under Article 17 of the Agreement on Customs Valuation [Rule 10(2) of the Customs Valuation Rules, 1988]. The opinion merely says that it is permissible to have different transaction values of comparable goods under the Transaction Value method. As seen in this case also, the comparable goods were found to have been imported at different prices in a price range of US $ 1860 to $ 1950 PMT. However, the said Advisory Opinion cannot be taken to support a ridiculously low price of US $ 500 PMT. We also note that the Advisory Opinion given by the Technical Committee on Customs Valuation does not bind any country nor it has the same status as of the Decisions of the WTO Committee on Customs Valuation. The Advisory Opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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