TaxTMI 
TaxTMI 
2011 (11) TMI 620
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....n brief, as under :- 1.1.1 M/s. Siddharth Polymer Ltd., subsequently renamed as Siddharth Area Ltd., Flat No. 13L, 25, Gopala Towers, Rejendra Place, New Delhi (hereinafter referred to as SPL) with Shri Dinesh Aggarwal as its Director, M/s. Mono Acrylic Manufacturing Co. Ltd., Khasra No. 53, Gurudwara Road, Siraspur, Delhi (hereinafter referred to as MAML) with Shri Manish Agrawal as its Director, M/s. Global Enterprises, A-72, Swarup Nagar, Delhi (hereinafter referred to as GE) with Shri Sudhir Kumar Gupta as its proprietor and M/s. Gaitri Exports, 89-90, Industrial Area, Phase-I, Panchkula, Haryana (hereinafter referred to as GAE) with Mrs. Gaitri Devi as its Proprietor, and whose husband Shri Ashok Singla was running this firm, were, during the period of dispute i.e. from February, 1999 to October, 2001, engaged in import of Polycarbonate sheets. The polycarbonate sheets imported were opal white colour meant for signage/advertising industry. 1.1.1 During the period from January, 2001 to October, 2001, SPL imported 52 consignments of opal white polycarbonate sheets from Korea at declared price of US $ 1055 per M.T. out of which while 18 consignments had been purch....
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.....T. These consignments had been cleared by the concerned customs authorities after accepting the declared value and examination of the goods. 1.2 The officers of Directorate General of Revenue Intelligence, New Delhi, on receiving an intelligence that SPL, MAML, GE & GAE are evading huge amount of Customs duty by misdeclaring the description of polycarbonate sheets being imported by them as having been made out of recycled polycarbonate waste and thereby under declaring the value, searched their office as well as godown premises and also the premises of M/s. Shubh Plastics, Goregaon (West), Mumbai, the consignment agent for SPL, MAML & GE and of - (i) M/s. Hanuman Graphics Pvt. Ltd., Goregaon, Mumbai, and (ii) M/s. Laxmi Sales Corporation, Goregaon (West), Mumbai, the dealers, who were purchasing the polycarbonate sheets from M/s. GAE. Certain stock of imported polycarbonate sheets found in the godown of SPL, MAML, GE and GAE and also in the godown of the consignment agents/dealers - M/s. Shubh Plastics, M/s. Laxmi Sales Corporation and M/s. Hanuman Graphics was placed under seizure. From the office premises of SPL, a bunch of the certificates issued by M/s. Sehwa Polytech ....
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.... white polycarbonate sheets for signage/advertising industry, of the type which are imported and marketed by SPL, MAML, GE and GAE, are made out of virgin polymer material and the sheets of this type and quality cannot be made out of this recycled material, that the price of virgin raw material varies from 2 U.S. $ to 3.5 U.S. $ per kg. and the polymer sheets of virgin material are available in the international market at prices ranging from 4 U.S. $ to 6 U.S. $ per kg., that it is not possible to make such sheets out of 100% scrap/waste, that the approximate cost of converting polycarbonate waste/scrap into polycarbonate sheets is about U.S. $ 0.50 to U.S. $ 1 per kg., that price of polycarbonate scrap in international market, as available on internet, is about 0.58 U.S. $ per pound which would be about 1.2 U.S. $ per kg. and, that thus, even if polycarbonate sheets are made 100% out of recycled waste their cost would be around 1.75 U.S. $ to 2.2 U.S. $ per kg. Inquiry was made with Shri Vinay Kumar, Director - M/s. Vergola India Ltd., Mumbai, an importer of polycarbonate sheets, who stated that they are importing polycarbonate sheets made out of virgin material from Israel and th....
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....i through Indian Consulate as the standards samples, these samples along with the samples drawn from the consignments imported by SPL, MAML/GE and GAE were sent to IIT, Delhi and CIPET, Chennai. CIPET, Chennai under letter dated 1-8-2002 and IIT, Delhi letter dated 30-7-2002 reported that the samples drawn from the consignments (non-certified) and the samples sent to them as certified samples appeared to be similar and appeared to have been made from similar material. 1.2.3 Consulate (Eco.), Consulate General of India, Hong Kong on a reference from the investigating officers sent two reports dated 5-7-2002 and 7-8-2002 in this matter. In the report dated 5-7-2002, it was reported that information regarding prices of polycarbonate sheets for export from Korea to India during January, 2001 to December, 2001 has been obtained from Korean Customs and that average export price during this period was U.S. $ 3577 per MT. This report also gave the total export quantity of the Polycarbonate Sheets from Korea to India during January and December, 2001 period as 965.199 MT and its total value as 35,52,685 U.S. $ and on this basis, the average export price per MT came to U.S. $ 3577. T....
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....p; confiscation of the goods placed under seizure; (c) imposition of penalty on the importers - SPL, MAML, GE & GAE under Section 114A of Customs Act, 1962; and (d) imposition of penalty under Section 112(b) of the Customs Act, 1962 on Shri Dinesh Agarwal, Director SPL; Shri Manish Agarwal, Director of MAML; Shri Ashok Singla, husband of the proprietor of GAE; Shri Sudhir Gupta, Proprietor of GE, Shri Anand Bhandari, Partner of M/s. Shubh Plastics, Shri Ram Kishore Mandhana, Partner of M/s. Laxmi Sales Corporation and Shri Bharat Kumar M. Rathi and Shri Abhishek Lohia, Director and Manager respectively of M/s. Hanuman Graphics, Mumbai under Section 112(b) of Customs Act, 1962. 1.2.5 The Commissioner of Customs (Adjudication), New Delhi vide Order-in-Original No. 3/GS/CC/DRI/NCH/2006, dated 31-7-2006 in the case against M/s. SPL - (a) ordered enhancement of assessable value from U.S. $ 1055 per M.T. to U.S. $ 3580 per M.T. and confirmed duty demand of Rs. 8,92,88,587/- against SPL under proviso to Section 28(1) of Customs Act, 1962 along with interest on this duty at the applicab....
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....th option to be redeemed on total redemption fine of Rs. 7,05,000/-; and (d) imposed penalty of Rs. 1,00,00,000/- on Shri Ashok Singla, husband of Gaitri Devi, Proprietor of GE but did not impose any penalty on Shri Bharat Kumar M. Rathi, Director and Shri Abhishek Lohia, Director and Manager of M/s. Hanuman Graphics, Mumbai and Shri Ram Kishore Mandhana, partner of M/s. Laxmi Sales Corporation. 1.2.8 Against the above orders of the Commissioner, SPL and its Director Shri Dinesh Agarwal, MAML and its Director Shri Manish Agarwal, Global Enterprises along with its proprietor, Shri Sudhir Kumar Gupta - and GAE along with Shri Ashok Singla, the person in-charge of this company, filed appeals to this Tribunal. The appeals of SPL and its Director Shri Dinesh Agarwal were allowed by the Tribunal vide Order-in-Appeal Nos. 334-335/2007-Cus., dated 19-6-2007 on the grounds that - (a) since SPL in all the bills of entry had declared the goods as "Polycarbonate sheets" and not as "polycarbonate sheets made out of recycled material" and since the SPL's correspondence with M/s. Sehwa Polytech Ltd. in June, 2000 (which is reproduced in the ....
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....erage export price of polycarbonate items of Tariff Heading 3920 61 00 from Korea to India during the years 2000 and 2001 are of no evidence value in this case, as the Heading 3920 61 00 covers sheets, films, flats, foils and strips of polycarbonate, while in this case what was required to be produced was the price for export to India of opal white polycarbonate sheets. 1.2.10 The Department filed SLPs to Hon'ble Supreme Court against the above-mentioned two orders of the Tribunal and the Hon'ble Supreme Court vide its order dated 16-9-2008 set aside the Tribunal's orders and remanded the matter to the Tribunal for de novo decision with regard to the question of misdeclaration as well as the question of undervaluation. In this regard, observations of Hon'ble Supreme Court are reproduced below :- "At this stage we may state that in all these cases the point which arises for determination is that whether P.C. sheets imported by the noticees were made out of re-cycled or re-generated polycarbonate? This point has not been discussed or analysed in detail by the Tribunal which is the final fact finding authority. After noticing the arguments advanced on both sides, the Tribun....
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....ses, chemical test also. Long after clearance of the goods the Department has sought enhancement of the assessable value from U.S. $ 1040 - 1055 per M.T. to U.S. $ 3580 per M.T. without any concrete evidence. (2) As per the scheme of the Customs Act for filing of bills of entry and its processing, as laid down in Sections 17, 18, 46 & 47, the officers are supposed to examine the goods and call for all the necessary documents before finalizing assessment of duty. In view of this, once the goods are cleared, there is presumption that the officers had finalized the B/E after examining all the necessary records, thoroughly examining the goods and getting the same tested, if necessary. (3) The test report dated 30-7-2002 of IIT, New Delhi and dated 1-8-2002 of CIPET, Chennai reporting that the samples drawn from the imported consignments and the standard sample, provided by the Department, on tests, appear to have been made of similar material, are of no evidence value as - (a) the so called standard sample along with manufacturer's certificate certifying the same to be made out of virgin polycarbonat....
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....m virgin polymer and from recycled polymer can be used for signage/advertising applications. The appellants do not accept the contention that the price of recycled sheets is only 15% to 20% lower. (7) The documents that were recovered from the premises of SPL in course of search corroborate the appellants plea that the imported polycarbonate sheets have been made out of recycled waste/scrap. (8) The letters dated 5-7-2002 and 7-8-2002 of Consul (Eco.), Consulate General of India, Hong Kong are not the evidence of actual price for export to buyers in India of opal white polycarbonate sheets during the years 2000 and 2001, as these letters give only the average export price for export to India of all the goods falling under SH 3920 61 00 during the years 2000 and 2001. SH 3920 61 00, in addition to polycarbonate sheets, covers polycarbonate film, foils, strips, plates, etc. Moreover polycarbonate sheets are of a large number of varieties - transparent, optical quality, bullet proof, double walled, etc., with very wide variation in price. Moreover the information about total quantity and value of the goods of SH 3920 61 00 exported....
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....ugned order-in-original made the following submissions :- (1) Inquiry into the imports of polycarbonate sheets by SPL, MAML, GE and GAE had been started by the officers of DGRI on receipt of specific intelligence that the value and description of the polycarbonate sheets imported by them was being misdeclared. The imported polycarbonate sheets of opal white colour are meant for advertising/signage industry and for these applications, the sheets have to be of very good quality. The polycarbonate sheets made out of recycled waste cannot be used for signage/advertising industry. The very fact that the imported polycarbonate sheets are meant for signage/advertising industry indicates that the same have been made out of virgin polymer. (2) While the declared price of imported sheets by SPL, MAML and GE is from U.S. $ 1040 - 1055 per M.T. and in case of GAE the same was loaded from the declared price of U.S. $ 600 per M.T. to U.S. $ 1040 per M.T., the import price of polycarbonate resin during the period of dispute was in the range of U.S. $ 2093 - 2114 per M.T. Even in domestic market the sale price of polycarbonate resin during 1999....
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....lycarbonate sheets from Korea by persons, other than the appellants were very few. Therefore, the average price mentioned in Consul (Eco)'s report dated 5-7-2002 has been correctly adopted by the adjudicating authority. (6) As per the statement of Shri Mayank Jain of M/s. GE Plastics, a manufacturer of polycarbonate sheets in India, the international price of polycarbonate waste during 2000-2001 was about U.S. $ 1.2 per kg. and the recycling cost was about U.S. $ 0.50 per kg. to U.S. $ 1 per kg. Therefore the price of polycarbonate sheets made from waste would be U.S. $ 1750 - 2200 per M.T. The declared price of U.S. $ 1040 - 1055 per M.T., therefore, is not possible. (7) The goods imported were prime quality sheets without any defects. The correspondence of SPL with M/s. Sehwa Polytech regarding black spots and other defects in the sheets and M/s. Sehwa clarifying that the sheets being meant for signage applications are made out of recycled waste, had been fabricated by SPL and therefore no reliance can be placed on the same. Similarly the manufacturer's certificates recovered from SPL certifying that the polycarbonate sheets s....
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....goods at accepting three declared value. The fourth appellant - GAE imported the goods of Tiwan origin (553.174 MT) and Korean origin (147.632 MT) and all the imports had been made through dealers in U.K. at declared price of U.S. $ 600 per M.T., and the concerned customs authorities, allowed clearance of the consignments after their examination but enhancing the assessable to U.S. $ 1040 per M.T. The Department, after investigation conducted by the officers of DGRI is of the view that even the value of U.S. $ 1040 - 1055 per M.T. declared by SPL, MAML and GE and which was adopted by the Customs in respect of imports by GAE, is not the correct transaction value and that the same is to be enhanced to U.S. $ 3580 per M.T. The Department's allegation is that the appellants with intention to evade the duty have grossly underdeclared the value by claiming the goods to be made out of recycled polycarbonate scrap. It is these two points i.e. :- (a) Whether the imported polycarbonate sheets were made out of recycled/regenerated polycarbonate? and (b) Whether the evidence produced by the Department in support of the allegation of underva....
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.... Joshi, Vice-President, M/s. Jain Irrigation Systems, Jalgaon; statements dated 26-12-2001 of Shri Rakesh Jain, CEO, M/s. GE Plastic, Gurgaon and Statement dated 20-8-2002 of Shri Mayank Jain, Manager, M/s. GE Plastics wherein it has been stated that while it is technically possible to make polycarbonate sheets 100% out of recycled waste, the sheets so made would not be of good quality as such sheets have yellowishness (which can be offset only by using very costly pigments and thus making the process uneconomical) and black specks making them unsuitable for signage/advertising application, that the sheets meant for advertising/signage applications have to be of prime quality, that recycled polycarbonate waste is used for making dark colour opaque sheets only, not the white translucent sheets or transparent sheets and that since the international price of polycarbonate waste is U.S. $ 1.28 to U.S. $ 1.98 per kg. and since the cost of converting waste into sheets is U.S. $ 0.50 per kg. to one U.S. $ per kg., the cost of manufacture of polycarbonate sheets from recycled waste would be from U.S. $ 1.78 to U.S. $ 2.98 per kg. (ii) Test report dated 30-7-2002 of IIT....
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....ive the value of certain physical properties - "Tensile strength at yield", "Tensile strength at break", "Flexural strength", "Flexural modulus", - "Sp. Gravity" and "light transmission" of the "certified samples" obtained from M/s. Afro Textiles, Dubai and the samples drawn from the goods seized from the appellants and report that the non-certified samples have been made from similar material as in case of certified samples. But are the "certified samples" really certified samples? There is doubt about this in view of letter dated 3-7-2003 issued by M/s. Sehwa Polytech Ltd. and letter dated 3-3-2004 issued by M/s. Bayer Sewon Ltd. denying to have issued such certificates, denying to be having any dealer or distributor in Dubai, and even denying to have shipped opal white polycarbonate sheets to Dubai. There is no letter of M/s. Afro Textiles, Dubai introducing themselves as dealer/distributor of M/s. Sehwa Polytech Ltd., Korea and M/s. Bayer Sewon Ltd., Korea or explaining as to from where these samples along with the manufacturer's certificates had been obtained. It is, thus, not known as to how and from where the samples and the manufacturer's certificates certifying the samples....
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....IPET, Chennai, whose reports have been relied upon by the Department, it is seen that while for identifying contaminants in recycled plastics, there is ASTM-D-557-94 (2003) standard, the tests for identifying contaminants as per the procedure prescribed in the above-mentioned ASTM standard have not been conducted. The reports of IIT, Delhi and CIPET, Chennai are silent about presence or absence of contaminants. 4.5 The Department relies on the statements of Shri Subhash B. Joshi of M/s. Jain Irrigation System, Jalgaon; Shri Vinay K. Patel of M/s. M.H. Polymer, and Shri Rakesh Jain and Mayank Jain of M/s. GE Plastics, wherein it has been stated that the polycarbonate sheets of the type imported by the appellants and which are for signage/advertising industry application, cannot be manufactured by using recycled polycarbonate waste/scrap. All of them are domestic manufacturers of polycarbonate sheets and as such competitors of the appellants who marketed imported polycarbonate sheets. On going through their statements, we find that their statement that opal white polycarbonate sheets for signage/advertising applications cannot be made out of recycled polycarbonate waste/scrap....
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....Hong Kong and the details enclosed with this report go against the statements of the domestic manufacturers that good quality polycarbonate sheets cannot be made out of recycled waste. 4.5.2 As against the statements of the above-mentioned domestic manufacturers, we find that correspondence of SPL with M/s. Sehwa Polytech Ltd. in June, 2000, about the quality of polycarbonate sheets supplied by them, which was recovered from SPL's office in course of its search by the DRI officers, (pages 708 to 716 of the Vol. III of the compilation enclosed with the paper book of appeal No. C/625 of 2006 filed by SPL) it is clear that when SPL had complained to M/s. Sehwa Polytech Ltd. about defects like colour variation, black spots, etc., in the sheets, M/s. Sehwa Polytech Ltd. in their communication dated 5-6-2000 to SPL (page 712 of Vol. III of the compilation enclosed with paper book of Appeal No. C/625 of 2006 filed by SPL) had informed them that if the sheets are for lighting industry use, they must use scrap and remains. This correspondence (which supports the appellant's version) had been exchanged much before the investigation started in October, 2001. The Department's plea that....
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....) shall be accepted. One of such condition is that the importer and the suppliers are not "related person", as defined in Rule 2(2) and if they are so related, the relationship has not influenced the price. Besides sub-rule (2) of Rule 4, Rule 10A provides that when the proper officer doubts the value declared by the importer under Rule 10, he may seek further information and if he still has reasonable doubt, it shall be deemed that the value of imported goods cannot be determined under sub-rule (1) of Rule 4. The sub-rule (2) of Rule 4 and Rule 10A, thus complement each other and if either any of the conditions specified under sub-rule (2) of Rule 4 are not satisfied or the proper officer has reasonable doubt about the declared value, the assessable value has to be determined by sequentially applying Rules 5, 6, 7, 7A and 8, on the basis of the price of - (i) contemporaneous imports in comparable quantity of "identical goods", as defined in Rule 2(1)(c); (ii) price of contemporaneous imports in comparable quantity of "similar goods", as defined in Rule 2(1)(e); (iii) Deductive value method, (iv) computed value method; or (v) Residual (best judgment) method respectively. Under Rule....
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....ord "payable" in Rule 4(1) allows determination of the ordinary international value of the goods to be ascertained on the basis of data other than the price actually paid for the goods. This, according to the respondent, would be in keeping with the overriding effect of Section 14(1). We cannot agree. 11. It is true that the Rules are framed under Section 14(1A) and are subject to the conditions in Section 14(1). Rule 4 is in fact directly relatable to Section 14(1). Both Section 14(1) and Rule 4 provide that the price paid by an importer to the vendor in the ordinary course of commerce shall be taken to be the value in the absence of any of the special circumstances indicated in Section 14(1) and particularized in Rule 4(2). 12. Rule 4(1) speaks of the transaction value. Utilization of the definite article indicates that what should be accepted as the value for the purpose of assessment to customs duty is the price actually paid for the particular transaction, unless of course the price is unacceptable for the reasons set out in Rule 4(2). "Payable" in the context of the language of Rule 4(1) must, therefore, be read as referring to "the particular transaction" and....
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....n such cases would be imposing anti-dumping duties by following the procedure under Section 9A of the Customs Tariff Act, 1975. 5.2 The evidence relied upon by the Department for rejecting the transaction value of U.S. $ 1040 - 1055 per M.T. and enhancing it U.S. $ 3580 per M.T. is, in brief, as under - (i) The goods imported are prime quality polycarbonate sheets made out of virgin polymer while the same have been misdeclared as polycarbonate sheets made out of recycled waste/scrap. When the description has been misdeclared, the value becomes doubtful. (ii) Reports dated 5-7-2002 and 7-8-2002 of Consulate General of India, Hong Kong reporting the average export price from Korea to India during January, 2001 - December, 2001 period of polycarbonate sheets of SH 3920 61 00 as U.S. $ 3577 per M.T. and also giving month-wise figures (quantity and value) of export from Korea to India of the goods falling under SH 3920 61 00 for the years 1999, 2000 and 2001, coupled with the fact that the export figures of the goods of SH 3920 61 00 from Korea/India for the years 2000 and 2001, which are 1265.802 MT and 965.198 M.T. respecti....
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....99, 2000 and 2001 of the products of SH 3920 61 00 from Korea to India is based on the information obtained from the website - 'Korea Trade Statistics' of the Korean International Trade Association and though the earlier report dated 5-7-2002 of Consul (Eco.), CGI, Hong Kong mentioning the average export price during January, 2001 - December, 2001 from Korea to India of polycarbonate sheets as U.S. $ 3577 per M.T. also mentioned that this information has been obtained from Korea Customs, it appears that the average export price to India for 2001 mentioned in the report dated 5-7-2002 is also based on the information downloaded from the website of Korea International Trade Association. Thus what the reports dated 5-7-2002 and 7-8-2002 of Consul (Eco.), CGI, Hong Kong give us the average export price from Korea to India during 1999, 2000 & 2001 of the products of SH 3920 61 00. Even if it is assumed that the above average price and export figure are of polycarbonate sheets only, still this information is of no use for ascertaining the correctness or otherwise of the opal white polycarbonate sheets for signage/advertising usages imported by the appellants as there is wide variety of p....
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....tment's allegation of undervaluation against the appellants; and (ii) for determining the transaction value, it is only the price for export to India from the supplier country which is relevant, not the export price of those goods from the supplier country to some country other than India or the price of the goods in other countries. 5.3.2.2 In view of the above discussion, we hold that the reports dated 5-7-2002 and 7-8-2002 of Consul (Eco.), CGI, Hong Kong cannot be treated as evidence of actual transaction value of the goods imported by the appellants. 5.3.3 As mentioned above, for determining the assessable value of imported goods under Section 14(1) & 14(1A) of the Customs Act, 1962 read with CVR, 1988, what is relevant is the price under fully competition conditions of the goods for export to the buyer in India and this price is the transaction value i.e. the price actually paid or payable for the goods, when sold for export to India. The tests ascertaining the correctness or otherwise of the transaction value are prescribed in Rules 4(2) and 10A of CVR, 1988. The transaction value can be rejected only if the conditions for its acceptance ....
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....nd that if the charge of undervaluation cannot be supported either by evidence or information about comparable imports, the benefit of doubt must go to the importer. In this case, not only there is no concrete evidence to prove the charge of undervaluation, the evidence of comparable contemporaneous imports by other importers is in favour of the appellants. We, therefore, hold that the allegation of undervaluation is not sustainable. 6. In view of our above findings in Paras 4.1 to 4.6 and Paras 5.1 to 5.4 above, the Orders-in-Original No. 3/GS/CC/DRI/NCH/2006, dated 31-7-2006; No. 4/GS/CC/DRI/NCH/2006, dated 31-7-2006 and No. 6/GS/CC/DRI/ NCH/2006, dated 11-9-2006 passed by the Commissioner are not sustainable and the same are set aside. The appeals are allowed. (Pronounced in open Court on_____________) Sd/- (Rakesh Kumar) Member (Technical) 7. [Per : D.N. Panda, Member (J)]. - I have great advantage of reading elaborate order recorded by my learned brother Shri Rakesh Kumar, Technical Member. But in view of peculiar evidence on record, material facts borne by it and pleadings made by the parties in the course of hearing, it has become necessary to rec....
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....ain Irrigation Limited and M/s. Vergola India Limited. Statements were also recorded from them. 13. All the appeals arose out of common cause involving a most crucial and important question in all such appeals for which all the appeals were heard analogous and disposed by common order. The question so involved in this batch of appeals being whether P.C. Sheets imported by the notices were made out of recycled or regenerated polycarbonates and such question having direct bearing on valuation and other consequences of law, it has become necessary to deal with the efforts of Revenue made to find out quality and manner of manufacture of the impugned goods since Revenue claimed that recycling process was costly and not followed practice due to various unviable reasons and commercial infeasibility. So also the matter required an intensive examination of evidence in respect of quality claimed by the appellants. 14. While end-use of imported goods by advertising and signage industry threw light to doubt misdescription of goods by the appellants with intent to undervalue the impugned goods causing prejudice to the interest of Revenue, that also became one of the basis for Re....
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....17-5-2002. IIT also felt need of raw material of polycarbonate of prime quality (Virgin) which is clear from the evidence in cross-examination. In absence of such raw material, another option before IIT was for comparison of sample with prime quality sheet or the virgin quality sheet to be procured from the same source. Accordingly IIT requested to procure referral sample (comparable goods) of such quality (Ref : Answer to Q. 9, 13, 14, 15 and 22 in cross-examination at page 664 of Vol. 3 of Paper book). 18. Summons dated 8-2-2002, 16-8-2002, 12-9-2002; 20-9-2002 and 3-10-2002 were issued to the concerned importer to supply manufacturing details. But there was no response from the importer. Therefore, Revenue collected sample from Dubai and such sample related to "Hi-Tech" brand and "Polyglass" brand which were referred to as "certified sample". Such samples of six sets were procured from Afro Textiles of Dubai and duly sealed. Along with manufacturer's certificate those sealed packets were sent by Consulate General of India in Dubai (U.A.E) by Consulate's letter dated 12-5-2002 to Revenue. 19. The sample ("Hi-Tech" and "Polyglass") collected by Revenue from Dubai w....
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....e statements of the importer and their traders. (Ref : SCN Paras 12.1 & 12.2). Accordingly Show Cause Notice was issued to the appellants for opportunity of defence. The show cause notice also brought out above test results for the knowledge of the appellants. 22. Being aggrieved by report of IIT, Delhi and CIPET, Chennai, the appellant Siddhartha Polymer, by its letter dated 12-4-2003 requested DRI to provide the sample of seized goods and samples obtained from Dubai. But DRI vide their letter 23/24-4-2003 denied to provide sample to the appellant. For denial of supplying both the samples (sample of seized materials and Dubai samples) collected by DRI, the appellant again by its letter dated 4-6-2003 informed DRI that it was entitled to samples of seized goods as well as samples obtained from Dubai. On 5-8-2003, the appellant informed the learned Commissioner of Customs, ICD, Tuglakabad, New Delhi that the appellant soon after receipt of show cause notice requested the DRI to supply sealed samples drawn from godown of the appellant since that was not given to them at the time of seizure as well as the samples obtained from Consulate General of India in Dubai for testing an....
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....e to summon dated 14-1-2002, Shri Vinay Kumar, Director of Vergola India Ltd. replied that they import PC sheets made of virgin sheets only and they are not dealing with any recycled or regenerated PC sheets. They are also not aware of marketability of PC sheets manufactured through recycled scrap or regenerated scrap. Shri Rakesh Jain, President and CEO of GE Plastics India Ltd. in response of summon, stated by a letter dated 14-1-2002, that there is difference between virgin and recycled or regenerated PC. Also Shri Mayank Jain of GE Plastics appeared on 20-8-2002 and stated characteristics of PC sheets as under :- (1) Multiwall sheets are multilayered sheet with hallow cavity and are used in the building and construction industries. (2) Margard is a hard coated, abrasion resistant sheet which is used in security glazing. (3) Lexgard sheets are bullet resistant sheets which are primarily used for security glazing purposes. (4) Solid sheets are regular polycarbonate sheets, transparent, translucent or opaque. These may also be plain or textured. The use of these sheets large....
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....that was used by the manufacturer of the appellant remained unproved. 27. From some of the aforesaid evidence it is noticed that polycarbonate sheets is also possible to be manufactured using regenerated/recycled materials. But an important question arises is whether commercial quantity of the polycarbonate sheets is manufactured out of recycled/regenerated polycarbonates and traded in International market and whether such manufacture is commercially and economically viable. Revenue therefore cannot be denied to have benefit of preponderance of probability against the appellants. 28. Also a query was made to both sides as to whether impugned goods are covered by standard, if any, prescribed by Bureau of Indian Standards (BIS). There was no reply from either side to show that specification and description of the goods are standardised. Had there been any specification prescribed by the Bureau that would have thrown some light. But this case is not guided by BIS specification. 29. Specification, quality and nature of any goods as well as process of manufacture thereof if expected to be understood by technical test and sense, it would be safe to understand the ....
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....tunity shall result in miscarriage of justice. It may also be stated that when the appellants were buying the goods from traders of Singapore how they had access to the Manufacturer of Korea to have their stand that the documents gathered by Revenue were not genuine. It is curious to note that when the appellants question Dubai sample, at the same time they rely on test report of CIPET, Bhopal and Amritsar testing such samples to report in their favour. Such controversy needs resolution to meet the end of justice. 33. When Revenue discharged its onus of proof bringing "Certified sample" showing that only opal white polycarbonate sheets, used in advertising and signage industry are manufactured out of virgin raw materials and such goods are commercially traded in International Market, there was no evidence led by the appellants to show that commercially and economically viable/feasible quantity of recycled/regenerated polycarbonate sheets are manufactured in the globe for international trade. So also no evidence was led by appellants to discard that the "Certified samples" procured by Revenue was not opal white nor manufactured from virgin polycarbonate resin. 34. In....
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....rd both sides on the difference of opinion in the above appeals. 36. The facts of the case are already set out in detail in the order recorded by learned Member (Technical) Shri Rakesh Kumar and hence are not repeated herein. The finding of the adjudicating authority that opal white polycarbonate sheets imported by the appellants are made out of virgin polymer and not from the recycled waste as declared, is based upon (a) statement of domestic manufacturers of polycarbonate sheets - statement dated 6-2-2002 of Shri Vinay K. Patel, General Manager of M/s. M.H. Polymers; statement dated 15-2-2002 of Shri Subhash Baburao Joshi, Vice-President of M/s. Jain Irrigation Systems, Jalgaon; statement dated 26-12-2001 of Shri Rakesh Jain, CEO of G.E. Plastics India Ltd., Gurgaon and statement dated 20-8-2002 of Shri Mayank Jain, Manager, G.E. Plastics India Ltd. wherein it has been stated that while it is technically possible to make polycarbonate sheets 100% out of recycled waste, the sheets so made would not be of good quality (2) test report dated 30-7-2002 of IIT, Delhi and test report dated 1-8-2002 of CIPET, Chennai that the standard samples i.e. samples of Hi-Tech brand and Pol....
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....ve not been independently tested, I find that the test reports of CIPET, Bhopal and CIPET, Amristar clearly opine that the material (seized goods) is reprocessed/recycled grade. The reports are reproduced herein below : Even if the CIPET, Bhopal report cannot be relied upon for the reason that the samples were in loose form, CIPET, Amritsar report clearly shows that the samples were sealed. CIPET, Amritsar has tested the seized goods (Hi-Tech brand of Sehwa Poly Tech with reference to physical appearance, identification, density, overall migration and MFI). The goods have been tested by the same parameters, by CIPET, Bhopal. The appellants have also produced evidence that M/s. Afro Textiles of Dubai does not deal in plastic products. 40. I also find that it has been reported that Bayer Sewon does manufacture polycarbonates from recycling and these are Base Recyclates. 41. The Revenue has relied heavily on the fact that prior to March, 1999 the importers had described their goods as "off spec" or "stock lot" polycarbonate sheet while in the Bills of Entry under which the goods in dispute have been imported, the goods have only been described as per Customs Tariff ....
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....about the former type of polycarbonate sheets. 43. To clinch the matter, I note that in the counter-affidavit filed before the Hon'ble Punjab & Haryana High Court at Chandigarh in the writ petition filed by the importers for release of the goods, the Revenue has clearly stated that M/s. Siddharth has not been suspected of misdeclaration of the goods as they have not declared it to be made out of scrap. 44. In the light of above, I agree with learned Member (Technical) that the finding of the Commissioner that the imported polycarbonate sheets are not made out of recycled polycarbonates is not sustainable. 45. As regards valuation, I find that the charge of undervaluation of goods depends upon the finding as to whether the goods have been misdeclared or not. I have already concurred with the finding of learned Member (Technical) that the goods have not been misdeclared. However, without stopping here, I am going into the question of alleged undervaluation. I find that the learned Member (Technical) has recorded a detailed finding on valuation and then come to the conclusion that there is no merit in the contention of the Revenue that appellants have misdeclar....
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....nd for collecting samples would also amount to going beyond the scope of the SCN. Further, the direction of limited remand would be impractical to follow. If it was possible for the Revenue to collect the desired samples from the Korean manufacturers, they would have done it through Consulate General of India in Hong Kong. It is also not clear as what are the other authentic sources known to law and therefore this is a vague direction which is not capable of being implemented. The Chemical Examiner of CIPET, Bhopal and CIPET, Amritsar have not been cross-examined by the Revenue, which they could have done if so desired, and therefore the direction in the order of the learned Member (Judicial) for Revenue to cross-examine these Chemical Examiners amounts to giving an opportunity to the Revenue which was never asked for by them. Ld. Member (Judicial) has also advised adjudicating authority to take advantage of the detailed discussion on valuation by learned Member (Technical), without recording any independent finding on the valuation issue. Ld. JCDR has also not put forth any plea in support of the order recorded by learned Member (Judicial). 46. In the light of the above di....
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....2 क पà¥à¤²à¤¾à¤¸à¥à¤Ÿà¤¿à¤•à¥à¤¸ टेकनॉलाजी उरà¥à¤µà¤°à¤• मंतà¥à¤°à¤¾à¤²à¤¯, à¤à¤¾à¤°à¤¤ सरकार) 600 032. 42371 (6 Lines) 44-2347120 144-2344673 TEST CERTIFICATE PART-C TEST RESULTS CENTRAL INSTITUTE OF PLASTICS ENGINEERING & TECHNOLOGY (Ministry of Chemicals & Fertilizers. Govt. of Indial Guindy, Chennai - 600 032. Phone: 2342371 (6 Lines), Grams: CIPET Fax: 91-44-234712u 91 44 2344673 Email: [email protected] Website: www.cipetindia.com Result Property Standard Unit oblained No. 4053 Specified requirement Sampie A-1 Sample A-2 Sampie.A-3, Sample B-1 Sample B-2 GE-2 SP-2 MA-2 Senwa Bayer-Sewon Tensile strengt at yield ASTM D Kg/cm² 655.0 643.0 640.0 666.0 673.0 638 Tensile strength at break ASTM D Kg/cm² 500.0 638 531.0 " 488.0 604.0 517.0 Flexural strength ASTM D Kg/cm³ 726.0 805.0 837,0 852.0 811.0 Flexural modu....
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....hall not be published, advertised, used for any legal action, unless prior permission has been secured. This test report is only for the sample tested. PART-B SUPPLEMENTRY INFORMATIONS Reference to sampling procedure wherever applicable. Supporting documents for the measurements taken and Resuks derived like graphs, tables, sketches and/or Photographs as appropriate to test report, if any (to be attached). Deviation from the teal methods as prescribed in Relevant work instruction, if any : Supplied by the party As given in Part-C Nil дет Contd....2/- Document 4 सेंट, à¤à¥‹à¤ªà¤¾à¤² Continuation Sheet CIPET, BHOPAL Test Report No.5253 Date :16/8/2005 Page No. 2 of 2 PART-C Test Results S.No Name of the test Test Method Unit Test value obtained 1 Physical appearance CIPET Method Size: mm 198 x 116 Colour: Shape Milky white Rectangular 1.76 Thickness mm 2. Identification CIPET Method Poly Carbonate 4. Density ASTMD-792 gm/cc 1.20 5. Overall Migation IS:4985 mg/Litre 28.....