Custom, Excise & Service Tax Tribunal
M/S. Nava Durga Enterprises vs Cc (Sea Import), Chennai on 9 April, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
C/61/2004
(Arising out of Order-in-Appeal C. Cus. No. 693/2003 dated 19.11.2003 passed by the Commissioner of Customs (Appeals), Chennai)
For approval and signature:
Honble Shri P.K. Das, Judicial Member
Honble Shri Mathew John, Technical Member
1. Whether Press Reporters may be allowed to see the Order for Publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Members wish to see the fair copy of the Order?
4. Whether order is to be circulated to the Departmental authorities?
M/s. Nava Durga Enterprises Appellant
Vs.
CC (Sea Import), Chennai Respondent
Appearance Shri R. Alwan, Advocate, for the Appellants Shri K.S.V.V. Prasad, Jt. Commr. (AR) for the Respondent CORAM Honble Shri P.K. Das, Judicial Member Honble Shri Mathew John, Technical Member Date of Hearing: 09.04.2013 Date of Decision: 09.04.2013 Final Order No. ____________ Per P.K. Das The appellant filed this appeal against Order-in-Appeal No. 693/2003 dated 19.11.2003.
2. The relevant facts of the case in brief as revealed from the record are that the appellant filed a Bill of Entry No. 213662 dated 9.2.2001 for clearance of 32000 sheets of hardboard of size 2440 x 840 x 3.2mm declaring the value as USD 0.64 per sheet. The goods were accompanied with Invoice No. 16141 dated 16.1.2001 issued by M/s. Sawmill Lumber Sales (Pty.) Ltd. South Africa and the country of origin was declared as Zimbabwe. The appellant purchased the imported goods on high sea sales basis from M/s. JG Impex, Delhi. The adjudicating authority enhanced the value from USD 0.64 per sheet to USD 1.25 per sheet and fixed the assessable value at Rs.18,95,471/- under Rule 8 of the Customs Valuation Rules, 1988. He also confiscated the goods and allowed redemption of the goods on payment of fine of Rs.3,80,000/- and imposed penalty of Rs.6,16,220/- under Section 112(a) of the Customs Act, 1962. The Commissioner (Appeals) modified the adjudication order by reducing the redemption fine to Rs.2.50 lakhs and penalty to Rs. One lakh.
3. The learned counsel on behalf of the applicant submits that the appellants purchased the goods on high sea sales basis from M/s. JG Impex, Delhi. The Bill of Entry and the commercial invoice would indicate the description of the goods as hardboard, 3.2mm thickness, 2440 x 840 size, quantity of 32000 sheets at the price of USD 0.64 per sheet. The learned counsel submits that M/s. Sawmill Lumber Sales (Pty.) Ltd., the exporting company of Zimbabwe have exported odd size hardboard (2440 x 840 x 3.2mm) quantity being 12800 sheets at USD 0.64 per sheet to M/s. Agarwal manufacturing Company, Ajmeer, cleared from the Mumbai Port vide Bill of Entry No. 181108 dated 8.5.2001. It is submitted that show-cause notice was issued on the basis of quotation and the value cannot be enhanced on the basis of such quotation. He also drew the attention of the Bench the certificate issued by the manufacturer on this regard. It is also stated that the price was fixed after a thorough negotiation with the supplier.
4. The learned AR reiterates the findings of the Commissioner (Appeals). He submits that the appellant failed to produce the invoice issued by the manufacturer. He further submits that value was enhanced on the basis of quotation issued by the manufacturer. It is also submitted that the description of the goods and the quotation and the commercial invoice in this case are mostly similar.
5. After hearing both sides and on perusal of the records, we find that the adjudicating authority has observed no identical import or similar imports have taken place during the contemporaneous period. It is observed that apart from the quotation price there was various letters addressed to SIIB, Chennai Customs House by the All India Fibre Board Manufacturers Association, Mumbai, regarding the import of same goods by undervaluation. We find that the said evidence was not found in the show-cause notice. It is noticed that the thickness of the goods in the quotation and the present goods are different. The appellant produced Bill of Entry No. 181100 dated 8.5.2001 of import of hard board of the same size in the same price by M/s. Agarwal Manufacturing Co. in Mumbai Port. In any event, it is settled law that the quotation cannot be the basis for rejection of transaction value unless any other positive evidence of contemporaneous import. The price declared by the importer cannot be disbelieved on the ground that the manufacturers invoice had not been produced particularly when the goods were purchased from a trader on high sea sales. Revenue failed to produce any material to discard the declared price. In view of that, we find the enhancement of the declared value is not sustainable. Accordingly, the impugned orders are set aside and the appeal is allowed with consequential relief.
(Operative portion of the order was
pronounced in open court)
(Mathew John) (P.K. Das)
Technical Member Judicial Member
Rex
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