1992 (3) TMI 169 - AT - Customs

Tribunal rejects value enhancement, upholds declared invoice value. Department lacks evidence.

SAWHNEY EXPORT HOUSE (P) LTD. Versus COLLECTOR OF CUSTOMS

The Tribunal concluded that the Department failed to provide adequate evidence to justify the enhancement of the imported goods' value. As a result, the ... Valuation Issues Involved:1. Valuation of imported goods.2. Application of Section 14 of the Customs Act.3. Justification for enhancement of value.4. Reliance on external quotations and invoices.5. Classification of products.6. Grant of interest on refund amount.Detailed Analysis:1. Valuation of Imported Goods:The appellants imported 'Hooks and Loops' and 'Self Adhesive Tape' from Taiwan. The declared invoice value for 25 mm hook and loop was US $0.195 per pair metre, and for self-adhesive tapes, it was US $0.395 per piece. The Additional Collector enhanced these values to US $0.25 and US $0.48 respectively, and ordered confiscation with an option to redeem the goods on payment of redemption fine. The appellants challenged this enhancement on the grounds of valuation and redemption fine.2. Application of Section 14 of the Customs Act:The appellants argued that the transaction value, as per the amended Section 14 of the Customs Act, should be the price actually paid or payable for the goods when sold for export to India. They contended that the declared invoice value should be accepted as the transaction was genuine and there were no allegations of underhand dealings or clandestine remittance.3. Justification for Enhancement of Value:The Department justified the enhancement by relying on quotations from M/s. Hermanos Kaybee (HK) Ltd., Taiwan, and M/s. M.S. Arora & Co., Jallandhar, as well as an invoice from M/s. Asia Chemical Corporation, Taiwan. The appellants argued that these quotations and invoices were not disclosed to them and were not from the manufacturer/exporter, but from traders for smaller quantities, whereas their imports were directly from the manufacturer/exporter for larger quantities.4. Reliance on External Quotations and Invoices:The Tribunal noted that the Department relied on a price list from M/s. Hermanos Kaybee (HK) Ltd., Taiwan, dated 7-3-1988, which was not an invoice but a price list for 10,000 meters, whereas the appellants imported more than 4 lacs Twin Metres. Similarly, the invoice from Asia Chemical Corporation dated 28-2-1987 was for a smaller quantity and not contemporaneous with the appellants' imports. The Tribunal held that the charge of under-invoicing must be supported by evidence of prices of contemporaneous imports of like kind goods.5. Classification of Products:The appellants raised the issue of incorrect classification of the products during the arguments. However, the Tribunal declined to address this issue as it was neither mentioned in the Show Cause Notice nor raised during the adjudication proceedings before the Adjudicating Authority.6. Grant of Interest on Refund Amount:The appellants requested interest at the rate of 18% on the refund amount from the date of filing the appeal till repayment. The Tribunal rejected this request, stating that there is no provision in the Statute for such interest, and the Tribunal, being a creature of the Statute, cannot grant such relief.Conclusion:The Tribunal concluded that the Department did not provide sufficient evidence to support the enhancement of the value of the imported goods. The invoice value should be accepted in the absence of any evidence to support the enhancement. The appeals were disposed of on these terms.