TaxTMI 
TaxTMI 
2016 (12) TMI 1157
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....l examination, it was seen that the impugned 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 17^th 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....
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....1) of the Customs Act, 1962. Interest under Section 28AB was demanded. Penalty under Section 111(m) in lieu of confiscation was imposed and also penalty under section 114A was imposed. Aggrieved by the impugned order, appellants are before 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. A....
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....authority has also verified the price from various sources and websites and thereafter ascertained the correct value of the goods. Therefore it is not the case where the value was enhanced arbitrarily and without any basis. He submits that there is no bar in enhancement 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 th....
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.... 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 2. M/s. Hari Om Electronics 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 3. 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"-....
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.... and the clearance in the impugned case were made from Goa. It is fact that assessing officer while assessing Bill of Entry and clearing the goods from Goa, evidences such as quotation, value available on website etc were not known to the assessing officer therefore the quotations obtained even prior to the assessment of Bill of Entry does not make any difference as the same was not available before the Customs Authority at Goa. Therefore submission of the appellant in this regard will be of no help as it is clear case of suppression of value. On going through the judgments in case of Mytri Enterprises(supra) it is observed that case of Mytri Enterprises and the 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....
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....al proceedings. The Tribunal accepted the contention that the same norms as stated in the letter should be adopted in the case of the appellants before them. The present appellants are put to a dis-advantage vis-a-vis other importers when a different norm is applied to their goods. The case of Techno Marketing v. CCE, Calcutta, Order No. 640/03 dt. 18-11-2003 [2004 (164) E.L.T. 113 (T)] was relied upon. (c) The Commissioner erred in discarding the transaction value relying on some prices quoted in some obscure quotations engineered by the investigating officers themselves (S/Shri Sharma and Colaco). The case of Overseas International v. CCE, Chennai [2001 (127) E.L.T. 599 (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 pro....
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....cy as the importer failed to disclose the actual value of each of the models of speakers, a fact which is known to him alone. 12.He cited the case of Pan Asia Enterprises v. CCE, [1995 (79) E.L.T. 322 (Tri.) which is later upheld by the Supreme Court [1997 (94) E.L.T. A59 (S.C.)] and argued that when the imported goods were not supplied by the manufacturer and when the investigation revealed that higher prices were indicated in quotations, declared value could be rejected. 13.He argued that when goods of various models were imported but uniform price for all the models declared irrespective of model and combination without any details, invoice price is not acceptable. In support of this contention 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.....
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....he value indicated in this letter (letter dt. 11-1-2003) of the Commissioner of Customs, Mumbai has been arrived at after considering the prices observed in the trade as well as from other sources and the prices are also indicated size-wise and brand-wise, the prices indicated in the circular should commend itself for adoption in cases of doubt". We have perused the said letter. The letter further reads thus "However, if evidence of higher price is noticed or provided by agencies the aforementioned floor price (emphasis provided) will be revised". In the present case evidence of higher prices is gathered by the agency (CIU). The letter cited supra provides for revision/determination of price in case of fresh 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 ....
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....d price but seem to contest such revision because the prices ultimately determined were not in accordance with norms prescribed in the letter. We observe that the department is not bound to go by the letter and sprit of the Commissioner's letter while determining the value of imported goods. This is particularly so when the department decided to reopen the cases of similar goods cleared in the past. 22.Rejection of the declared price is one thing determination of value is another. It is therefore necessary to see whether the Commissioner re-determined the value of the impugned goods in accordance with the valuation rules. We proceed to do so. 23.The evidence suggesting that the speakers command a much higher 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....
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.... wonder then, that nobody imported the speakers declaring the real value during the period in question. And the letter of the Commissioner referred to earlier has not exactly served the cause of finding out the real value of the speakers. A few more of such letters would permanently discourage the importers from declaring the real value of the goods. 27.We have also considered the argument that just as a single Swallow does not make a summer, a single quotation or a couple of them cannot form the basis for rejecting a declared price. We could have agreed with that preposition but for the fact that in the present case the Commissioner relied on not a just of couple of quotations but also on the internet prices, distributor 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 ....