TaxTMI 
TaxTMI 
2006 (8) TMI 399
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....isions of Section 125 of the Customs Act, 1962. (b) Ordered that no drawback will be allowed on 1,68,000 pieces of T-shirts, as per Section 76(1)(b) of the Customs Act. (c ) Imposed a penalty of Rs. 1 crore upon the exporter under Section 114 of the Customs Act. (d) Imposed a penalty of Rs. 5,00,000/- each on Shri Nirmal Agarwal, authorised Signatory of the Exporters, Shri A.K. Vadera, Shri Uday Desai and Shri Sunil Verma, Directors of the Exporting Company and Shri Ajay Verma, Signatory of the export documents, under Section 114 of the Customs Act. (e) Imposed a penalty of Rs. 2,00,000/- each on M/s. Able Shipping Agencies Private Limited, Shri Gyan Sharma, Partner of M/s. Vinayak Shipping Agencies, Shri Rasheed Sheik, Manager of M/s. Panorama Express Agencies. (f) Ordered that goods under seizure and yet to be exported are allowed to be exported on payment of redemption fine and penalty but not drawback would be allowed on such exports and that the market price of these goods for the purpose of Section 76(1)(b) shall be wholesale market purchase price of M/s....
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....their delivery at docks and the only additional expense, if any, was the exporter's margin of profit and even adding 100% margin of profit, the value of the goods would not exceed Rs. 84/- per piece. The Revenue contends that the Commissioner has over looked the provisions of Section 14(1) of the Customs Act, 1962, while accepting the declared FOB value as the section provides that the value of import or export goods shall be deemed to be 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. Reliance is placed upon the decision of the Hon'ble High Court in the case of Bird and Co. (Pvt.) Ltd. v. Kalyan Kumar Sen Gupta, [1988 (37) E.L.T. 70 (Cal.)], wherein it has been held that what has to be taken as the basis of valuation is the price at which such or like goods are ordinarily sold at the time of place of exportation and, not the contract price and to the Apex Court decision in the case of Rajkumar Knitting Mills (P) Ltd. v. Collector of Customs, Bombay - 1998 (98) E.L.T. 292 (S.C.) to the same effect. 5. Further reliance is pl....
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....s declared was received by the appellants, and there was no evidence to show any money laundering. In the case of Cannon Steels Pvt. Ltd. v. Commissioner of Customs, Cochin [2002 (145) E.L.T. 490 (Tri.)], the Tribunal has held that invoice price has to be accepted as market price in the absence of any evidence to discredit the same, and the best evidence is documents and payments relating to the transaction itself. In the case of Commissioner of Customs, Kandla v. Dimple Overseas [2005 (190) E.L.T. 58)], it was held that since full remittance was received through banking channels, declaration of lower value made at consignee port cannot be a reason to arrive at the charge of having knowledge of under valuation. In the case of Sanjay Kapoor v. Commissioner of Customs [2004 (173) E.L.T. 198 (T)], the charge of mis-declaration of quantity and denial of drawback was set aside as there was no material or market enquiry regarding market value, specially when the foreign buyer had made full payment, which he would not have made if the goods were not of proper quality. 8. The case law relied upon by Shri Mondal to support his plea that receipt of remittance is not a definite indicati....
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....e. Therefore, in any event, the market price cannot be less than Rs. 42/- per piece. The drawback claimed by the exporter works out to Rs. 35.27 per piece i.e. 10.2% of the FOB value. In these circumstances, the market price of Rs. 42/- is above the amount of drawback claimed and, hence, bar under Section 76 (1)(a) of the Customs Act is not attracted against the exporters. Even if the department's claim that the PMV is Rs. 28.53 is correct, drawback of Rs. 35.27 cannot be rejected for the reason that it is well within 150% of the PMV, in terms of the Board's Circular No. 69/97-Cus., dated 8-12-97, para 3(b) of which states that "Where the manufacturer-exporter declared PMV which is higher than the AR4 price .................., the higher PMV declared may be accepted up to 150% of AR4 value. Reliance placed by Shri Mondal on Circular No. 7/2003-Cus., dated 5-2-2003 providing that in cases where it is conclusively proved through verification that the FOB value had been artificially inflated/manipulated by the exporter to avail of unintended higher drawback benefits, the cases shall be investigated and decided on merits in terms of Sections 14 and 113 read with Sections 76(1)(b) and 1....