TaxTMI 
TaxTMI 
1994 (9) TMI 176
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....de Wide Spec. Since Directorate of Revenue Intelligence received information indicating mis-declaration and under-valuation in respect of imported goods, 80% goods were released provisionally at the request of the parties on execution of a provisional duty bond pending investigation. According to Department on detailed investigation carried out by them it was revealed that the Importers while importing Polystyrene G.P. Grade and H.I. Grade from M/s. Dongbu, Korea knowingly misdeclared the description of the said grades of Polystyrene as Polystyrene G.P. Grade Wide Spec and Polystyrene H.I. Grade Wide Spec respectively in the relevant Bills of Entry filed by them. They also misdeclared value of the said both grades at the rate of US $ 510 PMT CIF as against the actual and correct value of US $ 700 PMT CIF for Polystyrene G.P. Grade and US $ 760 PMT CIF for Polystyrene H.I. Grade. Accordingly, show cause notice was issued to enhance the value by rejecting the declared value and for confiscation of the 20% of the seized goods under Section 111(m) of the Customs Act, 1962 since 80% quantity has already been released provisionally, in addition to imposing penalty under Section 112(a) of....
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....v. Collector - 1991 (51) E.L.T. 457 (T) (8) P.A.C. Systems (P) Ltd. v. Collector - 1992 (58) E.L.T. 131 (T) (9) Punjab Niryat Ayat Pvt. Ltd. v. Collector - 1992 (58) E.L.T. 340 (T) (10) UOI v. Mahindra & Mahindra Ltd. - 1991 (55) E.L.T. 15 (Bom.) (11) Honesty Traders v. Collector - 1991 (55) E.L.T. 102 (T) He submitted that the imported goods are not of any specific grades and hence same cannot be compared with that of any graded material. The graded material which has quality, specific characteristics, brand and repute which the ungraded item lacks. While comparing the similar goods it should be substantially the same quantity as the goods being valued with reference to same grade. Similar goods are those which are commercially inter-chargeable and the items in question cannot be construed as inter-changeable since these are sub-standard goods. There is an inconsistency in the order passed by the Collector since he observed that prices of similar imports were not comparable but still compared with that of different graded material and ultimately determined the value under Rule 8 of the Valuation Rules as best judgment assessment without any data ....
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.... price was far less than the value of the comparable goods, the declared CIF price cannot be deemed to be the transaction value under Rule 4 of the Customs Valuation Rules, 1988 and it has been further held that determination of the value under Rule 8 of the Customs Valuation Rules was permissible even though in the show cause notice Rule 5 was invoked. He contended that Collector was not right in dropping the penalty in spite of his finding that importers were guilty of misdeclaring the value and there has been variation in declared value and value assessed. Alternatively, he requested that matter may be remanded to the Collector to decide the issues afresh. 6. In reply, Sri Asthana submitted that there is inconsistency in the opinions sought by the Department on the issue whether Wide Spec was a grade or not but there is no such inconsistency in the opinions of technical persons placed on behalf of Importers which clarifies that Wide Spec refers to Wide Specification not of standard grade but sub-standard goods or Off grade. He said that findings of the Collector that there has been no misdeclaration of description of the goods has not been challenged in the appeal filed ....
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.... GPPS, HIPS, etc., the properties that are specified for each grade include colour, Density, Melt Index, Heat Distortion Tem., Tensile and Elongation, Izod and/or Dart Impact, Shore Hardness, Electrical Properties etc. For every regular grade of PS, there is a set of values for each property for each grade and when the polymer produced does not conform to some of the important specified values of the range of grades, the polyer is considered as non-standard and is marketed at a much reduced price stamping it as `OFF-SPEC', `WIDE-SPEC', etc., and quite often in plain bags and without the brand name so that the supplier is free from any complaints on account of quality. On the commercial production runs, such problems are not unusual because of very many variables involved in the Polymerization Process, where one or more parameters could go wrong resulting into a Wide-Spec material. However, these materials are not useless for any applications. They can be used as such for some non-critical applications or by upgrading them by the use of Polymer additives or blended with virgin. Yet they are marked as Wide-Spec at a lower price so as to be protected from quality complaints and the re....