TaxTMI 
TaxTMI 
2012 (11) TMI 25
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....dicated below :- Quantum of Penalty S. No. Party Penalty (in Rs.) 1 M/s. Rochees Watches Pvt. Ltd. 15,00,00,000 2 M/s. Rochi Ram and Sons 4,12,00,000 3 M/s. Jaipur Time Industries 2,52,00,000 4 M/s. Rajasthan Watch Manufacturers 2,75,00,000 5 M/s. India Watch Parts Manufacturers 1,92,00,000 6 M/s. HMD Exim Pvt. Ltd. 1,60,00,000 7 M/s. Prakash Sales Agency 20,00,000 8 Shri Iswar Das Moolrajani 10,00,00,000 9 Shri Nanak Das Moolrajani 5,00,00,000 10 Shri Hargun Das Nebhnani 50,00,000 2. The impugned order passed by the Commissioner is detailed one and we make it clear that we are guided by the arguments advanced at the time of hearing....
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....upon by the adjudicating authority is the cost of production of the watches which is lower than the FOB value declared by the exporters. For the above purpose, he has relied upon the fact that the appellant has shown purchase of gold and its use in the manufacture of watches whereas the samples of watches tested by the Revenue has revealed that no gold plating was done on the same. Learned Advocate submits that the above evidence relied upon by the adjudicating authority is erroneous and factually incorrect on the face of it inasmuch as the samples tested by the Revenue were for the domestic sale and not meant for export. He submits that the test conducted on the watches which were admittedly for domestic sale in respect of which the appell....
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....pt in terms of the provisions of law inasmuch as there are no common directors in the exporting company and buyer company; no revenue sharing between the two companies; other directors are independent directors and as such, exporting company and buyer company cannot be held and covered under the definition of 'related person' in terms of the provisions of Section 2(2) of Customs Act. He submits that the Commissioner has held them to be interconnected undertakings under the Companies Acts, which in fact is worse than the related person. The Commissioner has further relied upon the overseas enquiries made from High Commission in London, Singapore and Spain where exports have been made. Elaborating on overseas enquiries, he submits that in ....
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....ng at PMV is contrary to the said circular of the Board. In any case and in view of the matter M/s. Rochees Watches (P) Ltd. has already given a bank guarantee of Rs. 1.10 crore and they are ready to keep it alive during the pendency of the proceedings. 5. Learned SDR appearing for the Revenue reiterated the reasoning adopted by the adjudicating authority. Inasmuch as the reason adopted by him already stands discussed in the preceding paragraphs while dealing with the submissions made by the learned advocate, we are not reproducing the same again. 6. We are of the view that at this interim stage, apart from noticing that the evidence relied upon by the Revenue are not clinching evidence so as to advance their case, we tak....
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....bject to value cap, PMV is irrelevant. 8. We hold that the Revenue is bound by the said Circular issued by the Board and the Revenue's endeavour to re-decide the FOB based upon the PMV cannot be appreciated at this interim stage. Otherwise also by taking into account various evidence as discussed above, and the explaination for the same as advanced by the appellant and in view of the various decision of the Tribunal, we hold that the FOB value declared by the appellant cannot be discarded in lighter manner. Tribunal in the case of CC, Kandla v. Crown International - 2006 (203) E.L.T. 120 (Tri.-Mum.) has observed that cost to manufacture is not relevant for arriving at the FOB value as manufacturer might make huge profit and only fac....