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2016 (12) TMI 1157
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....ed goods (speakers) of Thailand, Malaysia, Korea, China, Japan and Mexico origin were supplied by dealers from Dubai, Hong Kong, Singapore. The value of the speaker were enhanced on the basis of contemporaneous import and allowed the clearance of the goods. Later on department has contended that market survey/investigation wherein it appear that there was gross mis-declaration and under invoicing of the goods imported by the appellant and that value of the speaker while assessing the same for payment of customs duty was also not approximate to their actual value. The price of the goods also checked from the internet which revealed the price as below: Model Wholesale price Market price 1) TS-A-6955 U$39.69 US$ 66.15 2) TS-A-6985 U$57.15 US$ 81.00 3) TS-A-6995 U$67.50 US$ 98.55 Thereafter, inquires were conducted and quotation of the same goods were called for from M/s. Sun City Electronics, Dubai which was submitted by them vide their fax letter dated 17th June, 2002. As per quotation, the following wholesale prices were quoted. (i) TS-A 6955 DHS 147.00 each paid(Wholesale) (ii) TS-Z-6985(made in China) DHS 215.00 each pair-1000 pair (iii) TS-A 6995(Made in China) ....
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.... us. 3. Shri. Jitu Motwani, Ld. Advocate for Newteck and Star audio, Shri. D.H. Nadkarni, Advocate for Laxmi Enterprise and Orient Impex, Shri. C.S. Birasdar, Advocate for Bright Impex and Hari Om Electronics, None for M/s. Merico and Continental traders. They made following submissions. (a) The entire case of undervaluation was made out on the basis of quotation said to have been obtained from Dubai based dealer. The quotation is in the name of the officer and same is unsigned but the same was received by fax, therefore the authenticity of the said quotation itself doubtful. (b) The quotation relied upon by the revenue was obtained six months before the import of the goods. The impugned goods being electronic goods, the price of the electronic goods can be reduced very fast, this is general trend of the market of the electronics goods therefore the six months old quotation cannot be relied upon when the goods imported six months later. All the goods not imported from Dubai but also from the Hong Kong and Singapore whereas for all the cases the reliance was placed on the quotation, said to have been obtained from Dubai. (c) At the time of import of speaker the assessing authori....
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....hancement of the value even when the price was once enhanced at the time of clearance of the goods. He submits that in the present case there is clear suppression of actual value of the goods and in investigation the actual price was revealed. In such situation since actual price of the goods was not made available before the customs authority at the time of the assessment, the department is free to enhance the value as and when fresh evidences are available to the department therefore even once the value was enhanced the subsequent enhancement of the value on the basis of the evidence made available by investigation is in order. He submits that as regard the submission of the appellant that goods are imported not only from Dubai, but also from Hong Kong and Singapore, he submits that in present case in respect of the goods, the country of origin is either China, Thailand, Japan and Maxico. Therefore the country from where the goods were supplied is immaterial. The product is established pioneer brand goods having particular specification, such goods are available more or less at the same price irrespective of country of supply therefore the country of supply of the goods is not si....
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..... M/s. Ocean Intl. TS-A6955-6"x9"-220 w US $ 15 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6"x9"-260 w US $ 15 58.05 140.0 57.51 58.05 TS-A6995-6"x9"-300 w US $ 15 62.10 170.0 67.50 62.10 4. M/s. Newtech Corpn. TS-A6955-6"x9"-220 w US $ 9.00 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6"x9"-260 w US $ 9.50 58.05 140.0 57.51 58.05 TS-A6995-6"x9"-300 w US $ 10.00 62.10 170.0 67.50 62.10 5. M/s. Star Audio TS-A6955-6"x9"-220 w US $ 9.00 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6"x9"-260 w US $ 9.50 58.05 140.0 57.51 58.05 TS-A6995-6"x9"-300 w US $ 10.00 62.10 170.0 67.50 62.10 6. M/s. Orient Impex, Delhi TS-A6955-6"x9"-220 w US $ 9.00 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6"x9"-260 w US $ 9.50 58.05 140.0 57.51 58.05 TS-A6995-6"x9"-300 w US $ 10.00 62.10 170.0 67.50 62.10 7. M/s. Continental Traders TS-A6955-6"x9"-220 w US $ 9.00 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6"x9"-260 w US $ 9.50 58.05 140.0 57.51 58.05 TS-A6995-6"x9"-300 w ....
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....present appellant's are under common investigation. In the said case also the same quotation of Dubai based trader and value available on websites were relied upon and the enhancement of the value on that basis has been affirmed by the Tribunal. This Tribunal judgment was upheld by the Apex court, relevant paras of both the judgments are reproduced below: Mytri Enterprises(supra)(Tri.) 4. M/s. Mytri Enterprises is a partnership firm. It has two partners S/Shri Sushil Kumar Agarwal and Jayant Bachata. The firm imported car speakers (declared them as load speakers) of three models, declared on uniform price of US $ 9 per pair totally valued at US $ 14,391 CIF and filed a bill of entry for their clearance. They were assessed to duty enhancing the value from US $ 9 to US $ 11.60 per pair in respect of one model, US $ 9 to 11.74 per pair in respect of another and US $ 9 to 11.81 per pair in respect of the third one. This revision of value is in accordance with a formula invented by the Commissioner of Customs, Mumbai. The formula is contained in a letter dt. 11-1-2003 by the Commissioner addressed to the Chief Commissioner. We append the letter to this order so that we don't have to r....
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.... (T) = 2000 (41) RLT 101 (Tr.)] is relied upon to agree that quotations cannot overrule the prices shown in the invoice. (d) Reliance on prices exhibited in the internet is erroneous. Aggarwal Distributors Pvt. Ltd. v. CCE, New Delhi [2000 (117) E.L.T. 49 (Tri.)] was relied upon. (e) Cross examination of Shri Sharma and Shri Colaco was not allowed resulting in gross violation of principles of natural justice. (f) Burden of proving under-valuation is on the department and it can only be discharged by production of affirmitive evidence and not on the basis of suspicion etc. The department failed to produce any worthwhile evidence. Puja Poly Plastics Pvt. Ltd. v. CCE, Calcutta [2001 (131) E.L.T. 200 (Tri.)] and Sounds N. Images v. CCE [2000 (117) E.L.T. 538 (S.C.)] were relied upon in support of the contention. (g) Price quotations addressed to non-existing parties are not offers for sale under Section 14 of the Customs Act, Priti International v. CCE, Chennai [2001 (137) E.L.T. 184 (Tri.)] is relied upon. (h) Penalties on both the partners of the firm should not have been imposed under Section 114A of the Customs Act, whereas the section provides for imposition of penalty on the....
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....ontention he relied upon the case of Maya Enterprises v. CCE, Kandla [1994 (71) E.L.T. 817 (Tri.)]. In the present case the three models of speakers have different specifications but an uniform price is declared. Once the declared value is rejected on this ground the department can determine the assessable value on the basis of evidence, under Rule 8 of the Valuation Rules, in the absence of any other recourse available under Rules 5, 6, 7 of Valuation Rules. 14.In regard to the letter dt. 11-1-2003 of the Commissioner, Mumbai addressed to the Chief Commissioner which according to the appellants formed the basis of Valuation of car speakers in earlier imports he argued that the circular clearly speaks of rejection of the basis stated therein if evidence of higher prices is brought out. The department is not bound to adopt the norms prescribed in the letter cited supra in all cases and particularly so when evidence of higher values is gathered. 15.He distinguished the case of Aggarwal Distributors cited supra wherein the Tribunal held that internet prices cannot be relied upon to reject the transaction value. In the present case the internet price relied upon is a wholesale price ....
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....resh evidence indicating higher prices for car speakers. What the Commissioner did was exactly this. Again, we are not aware whether the imported goods in the case before the Delhi Bench are identical with the ones we are concerned with. Valuation Rules themselves do not provide for any floor prices that could be adopted while determining the value of imported goods. It is the transaction value or the value determined in accordance with the said rules that should commend itself for adoption and not those mentioned in some letter of some Commissioner irrespective of the fact that evidence of higher prices is brought to the notice of the department. In fact the basis of valuation of car speakers enunciated in the said letter can be easily challenged on the ground that it is not in accordance with Valuation Rules. 19.The letter under reference is nothing much to talk about. Determining prices of car speakers on the basis of their sizes and their out put ignoring other specifications such as the size of the woofer, midranges and Dom tweeter, frequency response etc., is to say the least appears, looks archaic. That perhaps is the reason while the department wished to reopen the past cl....
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.... price than what is declared by the appellants is in the form of quotations, and prices indicated to the internet. The prices indicated both in the website and the quotations are wholesale prices. A lot of arguments were advanced against acceptance of the prices indicated in the quotations. It appears that the quotations themselves, though were given by traders in Dubai, were engineered by two over enthusiastic officers. We observe that so long as the quotations themselves are tendered as evidence, the appellant had opportunity to demolish them by producing evidence in their favour. They did not avail of the opportunity except asking for cross-examination of the officers concerned. We have the authority of the decision of the Tribunal in the case of Satellite Engineering Ltd. relied upon by the ld. JDR, which held that non-disclosure of intending importers and not producing them for cross-examination will not amount to violation of natural justice. 24.The Commissioner has also considered the prices indicated in the internet, which are wholesale prices, to determine the prices at which the impugned goods are ordinarily sold in the course of international trade. At page 9 of the imp....
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....tor prices etc. to reject the declared price. We feel that it is perfectly in order to do so. We do not find any infirmity in so far as the revision of the value. 28.We observe that the adjudicating officers do not normally confiscate the goods and impose penalties on the importers while rejecting the transaction value. In the present case the Commissioner confiscated the goods and imposed penalties. We find that such an action is called for in the present case at least for two reasons. The value has been misdeclared so grossly that it attracts the charge of under-valuation. In other words it is not merely an issue where a transaction value is rejected. It is something more. And secondly an attempt to declare prices of all models at 9 US $ CIF per pair definitely constitutes mis-declaration of value. We hold therefore that the goods in question are liable to confiscation under Section 111(m) and persons concerned are liable for penal action under Section 114A of the Customs Act. 29.The Department's appeal is in regard to non-imposition of penalty on the firm. The Commissioner argued that a firm is not a legal entity and therefore no penalty can be imposed on it. According to him ....