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      2000  L  46    0.70 Dollar    each    1400 Dollars
     1000  L  12    2.80 Dollars   each    2800 Dollars
      600  L  31    0.75 Dollar    each     450 Dollars
      300  L  34    2.85 Dollars   each     850 Dollars

 

In each of the invoices the price was mentioned as F.O.B. New York, airfreight being added thereto, to arrive at the total C & F Bombay price shown.

Two show cause notices were issued with reference to these imports alleging that the prices declared and shown in the bills of entry were incorrect and were much lower than the actual prices and that there had thus been misdeclaration. It was also alleged that more quantity had been imported than declared in the invoices and bills of entry and thus there had been misdec-laration on that account also. Action was proposed, therefore, under the provisions of the Customs Act, 1962 as well as the Imports and Exports (Control) Act, 1947. Action was proposed thereunder against M/s BVH Limited as well as M/s Rallis India Limited.

5. Appeal No. 1464/80 (A) This appeal relates to imports by M/s BVH Limited under three bills of entry dated 14-9-78 (day old GP layer chicks46 boxes), 19-4-1979 (day old GP broiler stock50 boxes) and 18-7-79 (day old GP layer stock46 boxes). There is no dispute regarding the quantity imported in these cases. But, following the valuation made earlier, show cause notice was issued for violation of the provisions of Section 111 of the Customs Act as well as the Imports ard Exports (Control) Act, 1947 on the basis that there had been misdeclaration in respect of value and that the import was without licence of appropriate value. M/s BVH Limited claimed that they had approached the Government by way of a revision with reference to the earlier orders and that they were prepared to pay duty at the enhanced value subject to their objections being heard and were prepared to execute a bond for purposes of value of the licences. The supply under these bills of entry was in pursuance of the agreements dated 2-8-1978, 17-8-1978 and 9-4-1979 with the suppliers M/s Cobb Internationa] Inc. and M/s Babcock International Corporation. M/s BVH Limited claimed that the price mentioned in the agreements was proper and the same having been followed for showing the total value in the bills of entry there had been no misdeclaration regarding the value and therefore the imports were under cover of proper licences. After adjudication the Additional Collector under his order dated 28-2-1980/12-9-1980 rejected the contentions of. M/s BVH Limited regarding the price having been mentioned properly and, following the earlier findings regarding the valuation, held that there had been misdeclaration regarding the value and therefore in view of the enhanced value for purposes of duty there had been failure with reference to proper licence also to cover the imports. As regards the contention that since they had mentioned in the bills of entry the assessable value as declared by the department and that therefore there had been no misdeclaration, he pointed out that the importers had mentioned their own value as well as the value mentioned by the department and in such circumstances they cannot rely upon the mention of value according to the department to escape the charge of misdeclaration. He also pointed out that they had asked for provisional assessment only. He therefore directed finalisation of assessment on the basis of the value as determined by the department earlier and further imposed, under Section 112 of the Customs Act, penalties of Rs. 30,000, Rs. 63,000 and Rs. 72,000 respectively (for misdeclaration of value), and Rs. 12,500, Rs. 25,000 and Rs. 30,000 respectively (for ITC Contravention). On appeal to the Central Board of Excise and Customs it was ordered by the Board under order dated 31-1-1981 that in the absence of any documentary evidence to indicate otherwise, the values determined by the department are accepted as correct and confirmed but that as regards the charge of misdeclaration of value the Board was of the view that when the appellants themselves had asked for provisional assessment in the light of the assessment made in the earlier cases the charge of misdeclaration was not sustainable. They also held that there was no evidence of any extra remittance over and above the invoice value having been made. Following the same they held that the charge of under valuation for purposes of ITC remained unestablished. In the result they remitted in full all the penalties imposed by the Additional Collector and further directed that the invoice value should be accepted for ITC purposes. But so far as duty is concerned they confirmed the final assessment made by the Additional Collector on :the basis of the value earlier determined. In the revision to the Government against the said order M/s BVH Limited prayed for refund of the excess duty recovered, contending that the value for purposes of duty should also have been accepted according to the value mentioned in the invoice. It is the said revision that, on transfer, is now being dealt with as an appeal before this Tribunal.

11. So far as the misdescription with reference to the quantity is concerned this question arises only in Appeals No. 963/80 and 964/80 and 1378/80. In the first two cases as against the declared quantity of 1775 chicks the actual count disclosed 2754 chicks to have been imported. M/s BVH Limited or M/s Rallis Tndia Limited do not dispute that,excess quantity had been received. But the defence of M/s BVH Ltd. is that the despatch of excess quantity was due to error on the part of the seller and M/s BVH Ltd. was not aware of the same in any manner. It is in this connection that the subsequent correspondence between M/s BVH Ltd. and Babcock International Corporation has been produced. It is pointed out that when under their letter dated 19-9-1976 M/s BVH Ltd. complained about the receipt of excess quantity of chicks they were informed by the supplier under letter dated 23-9-1976 that for several months earlier they (Babcock International Corporation) were sending 'C line males also in addition to the 'N' line males in an experiment to better breeding but that by oversight they had failed to inform the same to M/s BVH Limited and that the excess in the 'D' line (which according to them was 500 only) was due to a clear mistake on the part of their shipping department in labelling and packaging. It is contended for M/s BVH Limited that thus it is established that the misdescription regarding quantity in the bill of entry filed for that import was due to total ignorance on their part of the excess despatched and therefore there was no wilful misdeclaration, which alone would invite a penalty. From the correspondence produced (between M/s BVH Limited and Babcock International Corporation) it appears that Babcock International Corporation were in fact willing to have the excess number of chicks destroyed if importation thereof was objected to as being more than the quantity mentioned in the bill of entry or in the alternative they were willing to send a supplementary invoice for the excess in the 'D' line leaving it to M/s BVH Limited to adopt either course. But the department appears to have been unwilling to allow the first alternative as they felt that destruction of the birds would merely entail loss of revenue to the Government. Therefore Babcock International Corporation appear to have sent a supplementary invoice dated 27-10-1976 with reference to the excess quantity, charging the 'D' line only (500 numbers) under that invoice. M/s BVH Limited contend that these letters would also establish that the excess quantity had been sent without their knowledge and, evidently, due to a mistake in the labelling and packaging department of Babcock International Corporation. Further, as pointed out by them, these imports were to be always allowed only after physical check and counting. In the circumstances it may be normally expected that M/s BVH Limited could not have agreed for the despatch of a number larger than mentioned in the invoice and, consequently, in the bill of entry. In the circumstances their defence that the excess quantity had been despatched due to mistake on the part of Babcock International Corporation and was not intentional and that in any event they (M/s BVH Limited) had no knowledge at all of the same till the birds were counted on arrival, appears to be very probable. In any event, the above circumstances would be sufficient to give the benefit of doubt to M/s BVH Limited regarding their participation in any intended excess import than the number mentioned in the invoices and the bill of entry. The contention for the department is that the ratio between male and female is to a large extent maintained even with reference to the excess quantity. This contention was advanced to suggest that the excess sent in the 'D' line could not have been due to any accidental mistake. But the contention about maintenance of the ratio with reference to the excess quantity also is not strictly correct. Therefore, this would also not be a sufficient ground to infer any intentional excess in the number sought to be imported. Therefore for all the above reasons we are satisfied that the charge of misdeclaration, arising out of the quantity imported, is not established so far as the imports covered in appeals No. 963/80 and 964/80 are concerned.

(ii) Appeal No. 1378/80 (A) In this appeal an excess import by 99 chicks had been found but no penalty had been imposed by the Deputy Collector on that ground. But on the basis of misdeclaration in respect of value resulting in importation without cover of valid licence (as the licence produced was not sufficient to import the goods of the value as determined by the department) the Deputy Collector had imposed a penalty of Rs. 40,000 which had been reduced to Rs. 25,000 by the Appellate Collector. This imposition was under Section 112 for violation of Section 111(d) of the Customs Act. But in view of the conclusion that the price mentioned by the importer was not lower than the international price (as had been held by the lower authorities) it follows that the charge of misdeclaration regarding value [under Section lll(m) if not lll(d)] cannot be upheld. Therefore, that penalty is also set aside, directing assessment on the price declared which has been accepted by us to be the proper price.