TaxTMI Login
AI Drafter - (New and Powerful) ✕
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Just a moment...
AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether import of complete electronic typewriters in knocked-down condition in breach of the Phased Manufacturing Programme and import restrictions justified confiscation under the Customs Act, 1962; (ii) Whether the goods were undervalued on the basis of the fax message, proforma invoice, and surrounding relationship between the importer and foreign supplier, warranting enhancement of value and penalty.
Issue (i): Whether import of complete electronic typewriters in knocked-down condition in breach of the Phased Manufacturing Programme and import restrictions justified confiscation under the Customs Act, 1962.
Analysis: The importer had an industrial licence and was required to indigenise progressively under the Phased Manufacturing Programme. The admitted position was that complete typewriters were imported in knocked-down condition, while the third-year import entitlement was only a limited percentage. The programme was not followed, and the facts were treated as falling within the principle applied in the precedent where import limits fixed under a manufacturing programme were binding. The import restrictions under the policy were therefore violated.
Conclusion: The confiscation of the goods was justified and sustainable in law, against the assessee.
Issue (ii): Whether the goods were undervalued on the basis of the fax message, proforma invoice, and surrounding relationship between the importer and foreign supplier, warranting enhancement of value and penalty.
Analysis: The record showed a special understanding between the importer and the foreign supplier, including reliance on proforma invoices for opening letters of credit. The proforma invoice number was reflected in the regular invoice, and the fax message and proforma invoice were treated as reliable indicators of the correct price. The claim of negotiated lower pricing was unsupported by evidence. On that basis, undervaluation was established and the enhanced value was upheld. The penalty was also found not excessive in the circumstances.
Conclusion: Under-valuation was proved and the enhancement of value and penalty were upheld, against the assessee.
Final Conclusion: The appeal failed in its entirety, and the confiscation, enhanced valuation, and penalty were sustained.
Ratio Decidendi: Where imported goods are brought in knocked-down condition in breach of a binding phased manufacturing programme, and contemporaneous documentary evidence establishes undervaluation in a context of special relationship, confiscation under the Customs Act and enhancement of value are justified.
TaxTMI 
