Customs, Excise and Gold Tribunal - Calcutta
Akshay Exports And Indus. vs Commissioner Of Customs (E.P.) on 1 November, 2002
Equivalent citations: 2003(160)ELT663(TRI-KOLKATA)
ORDER Archana Wadhwa, Member (J)
1. All the six appeals are being disposed of by a common order as they arise out of the same impugned order passed by Commissioner of Customs.
2. As per the facts on record/ the appellants, M/s. Akshay Exports & Industries, exported 86400 sets of Gaskets made of rubberised cork declaring FOB value of Rs. 1,44,38,840/- and filed six Shipping Bills with duty drawback claim of Rs. 23,82,400/-. The value declared as per the sets of Gasket was Rs. 167.37 and drawback claim of it is Rs. 27.62 per set. The Revenue has disputed the value of the said goods and alleged that the goods in question were over invoiced. The said allegations are based upon the following evidences produced by the Revenue :-
(i) A cash memo dated 30-3-2000 of one M/s. Dewang Automobiles showing the value of the Gasket stating as Rs. 1.60 per set;
(ii) Calculation of cost of the Gasket sets arrived at on the basis of purchase of cork sheet from M/s. Dharmesh Enterprises;
(iii) The earlier adjudication order by the Commissioner of Customs wherein the value of Gaskets was accepted as Rs. 80/- for the purposes of drawback claim.
3. Basing his decision on the above evidences, the Commissioner, Mumbai, has rejected the appellants' FOB value in respect of the six shipping bills and ordered for confiscation of impugned goods. However, inasmuch as the goods were released provisionally and exported, he has imposed a fine of Rs. 20 lakhs in lieu of confiscation. In addition personal penalty of Rs. 2 lakhs has also been imposed on M/s. Akshay Exports and Industries and penalty of Rs. 50,000/- on all other appellants has been imposed under the provisions of Section 114 of the Customs Act, 1962.
4. Shri Sudhir Mehta, ld. Advocate appearing for the appellants assails the impugned order and submits all the evidences relied upon by the Revenue are without any merits and are required to be rejected. He submits that the appellant has entered into a contract for export of Gaskets to M/s. Avia Exports, a Government Company of USSR. The said Company manufactured Air Crafts and highly precision items. The Gaskets exported by the appellants were to be used by the said Company in the manufacture of high speed jet engines and were made of superior quality. The value declared by them has been disputed by taking a quotation from a small scale dealer of automobiles without comparing the quality of the goods. He submits that the value quoted by the said dealer is in respect of cheap quality Gaskets used in the water pump and or accessories etc. He submits that there are various types of Gaskets and the value of the same cannot be compared with each other without comparing quality or the technical aspects of the two types. Shri Mehta also submits that the export between the appellants and the foreign buyers was at arm's length and the goods were exported in the usual course of business where the price was the sole consideration and they have also received the entire consideration of the same from their foreign buyers.
5. As regards the second piece of evidence, Shri Mehta submits that the Customs Authorities have arrived at the value of the goods on the basis of value of cork sheets purchased from the market. He submits that this system of valuation is not authorised and the value of the final product does not always depend upon the value of the main raw material only. Shri Mehta further submits that the earlier order of the Commissioner accepted the export value as Rs. 80 per Gasket set was appealed against by the appellants before the Tribunal and the order was set aside by the Tribunal vide Final Order No. A-1008/Kol/2002, dated 3-7-2002 rejecting the Revenue's contention that the value should be brought down of Rs. 166.67 to Rs. 80/-. In any case, Shri Mehta submits that the Commissioner has not even accepted the lower value of Rs. 80/- as held by the Commissioner in his earlier order. He draws our attention to the above order of the Tribunal wherein it was held that there was no evidence on record to substantiate the charge of over valuation of the goods. In view of the foregoing, he submits that the impugned order be set aside and the appeals be allowed with consequential relief to the appellants.
6. We have heard Shri N.K. Mishra, JDR for the Revenue who reiterated the reasoning of the Commissioner. After giving our careful consideration to the submissions made from both the sides, we find that the evidence of cash memo from M/s. Dewang Automobiles cannot be held to be an admissible evidence on record inasmuch as there is nothing in the impugned order of the Commissioner to show that the quality of the Gaskets exported by the appellants was the same in respect of which cash memo was obtained from M/s. Dewang Automobiles. As rightly argued by the ld. Advocate, there can be different variety and the gaskets which has to be used in high speed jet engines cannot be compared with the value of the simplicitor type of a Gasket to be used in water pump etc. As regards the valuation arrived at on the basis of sheet of cork, the same reasoning applies and it cannot be said at all a cork sheet of size is 3 x 2 can produce 40 sets of Gaskets and as such the prices 011 the said basis would be on the lower side. We also note of the fact that the appellants' buyer is a Government Company of USSR and have also remitted the entire consideration of the goods in question. The draw back required the adoption of the market value of like goods. In the absence of any evidence to show the lower market value of identical type of goods, the evidences produced by the Revenue cannot be accepted. We note that vide the earlier order, the Tribunal has accepted the value of the Gaskets as declared by the appellants. As such, we are of the view that there is no justification for lowering of FOB value of exported Gaskets of confiscation of the said goods or for imposition of penalty on M/s. Akshay Exports and Industries and other individuals. Accordingly, we set aside the impugned order and allow all the six appeals with consequential relief to them.