TMI Blog1998 (2) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... on under Section 111(d) has been ordered. The Commissioner has, however, given an option to the appellant to redeem the goods on payment of redemption fine of Rs.35 lakhs. For the purpose of Customs Duty, Commissioner has fixed the value of the goods at U.S.$ 1120 per M.T. CIF. He has also denied the appellant the benefit of Notification No. 203/92-Cus., dated 19-5-1992. A personal penalty of Rs. 15 lakhs has been imposed under Section 112(a) ibid on Shri Navneet Kumar, Proprietor of the appellant firm for his deliberate acts and omissions. 1.2.2 Two Appeals have been filed against the above Order-in-Original 51/95 (Commr.) dated 28-7-1995 one by the appellant firm, Goodluck Industries and another by the proprietor Shri Navneet Kumar being Appeals No. C/525/95A C-524/95A respectively. 1.3 Order-in-Original No. 3/96 (Commr.) dated 25-9-1995 involves 305 MTs. of polypropylene (PP) which have been confiscated by the Commissioner under Section 111(d) and 111(m) with an option to the appellant to redeem them on payment of fine of Rs. 50 lakhs. For Customs duty purposes, the Commissioner has fixed the value of the goods imported at U.S.$ 1015 per M.T. (CIF) for F.A. 8014 and PD-943 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1995. Personal hearing was given on 8-9-1995, Proceeding resulted in another impugned order dated 25-9-1995 referred to in Para 1.3 above. 3.1 Following two issues arise on the allegations made in the show cause notices, namely, (i) whether there is undervaluation of the goods as alleged for both PS and PP, and (ii) whether benefit of Notification 203/92 on the basis of licenses produced is available to the appellant firm. 4.1.1 It was alleged in the show cause notice relating to PS that the appellant submitted invoices of M/s Earth Resources Private Ltd. (ERPL) along with Bs/E and Xerox copies of the Bs/L, name of the Shipper is shown as ERPL and the name of the consignee is shown as To Order , and the party to be notified with address as Goodluck Industries, Sant Tukaram Road, Bombay India. In the invoices submitted, reference has been made to contract No.ER:GPPS dated 11-4-1994. 4.1.2 Show cause notice refers to Bs/E collected from Shipping Agent by Customs authorities who allege that these Bs/L are identical to the xerox copies filed by the appellant except the name of the Shipper and party to be notified which were as follows :- Shipper : Fook Lai Trading, Sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to order or assigns are by mercantile customs negotiable instruments, the endorsement and delivery of which may affect the property in the goods shipped. Endorsement is effected either by the shipper or consignee writing his name on the back of the bill of lading, which is called an endorsement in blank or by his writing Deliver to J [or Order] F which is called an endorsement in full . The shipper may, if he has retained the right of disposal of the goods, delete the name of the consignee and either leave the bill deliverable to a name left blank or insert the name of another consignee. So long as the goods are deliverable to a name left blank, or to bearer, or the endorsement is in blank, the bill of lading may pass from hand to hand by mere delivery, or may be redelivered without any endorsement to the original holder, so as to affect the property in the goods. But the holder of the bill may at any time fill in the blank either in the bill or endorsement, or restrict by endorsement the delivery to bearer, such power being given to him by the delivery to him of such a bill of lading." [emphasis supplied by the ld. Advocate] He submits that the above convention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relationship between the proprietor Shri Navneet Kumar of the appellant firm and controlling persons namely Vinod Kumar Didwania and Nidhi Didwania of ERPL who are uncle and aunt of Navneet Kumar. Ld. Advocate for the appellant has urged that Rule 2(2) of the Customs (Valuation) Rules, 1988 (hereafter the Valuation Rules) does not envisage any relationship between a supplier which is a private limited company and is, therefore, only a juristic person; it cannot be a `member of the same family as of Navneet Kumar. Even otherwise, it is submitted that there is no evidence that ERPL is controlled by Vinod Didwania except ipse dixit of the Commissioner. He further submits that the imports were made by the appellant at normal price, as per Section 14 ibid, as prevalent in the course of international trade during the relevant period. So-called relationship if any, had no influence on prices. Ld. Advocate Shri N.C. Roychowdhury has re-iterated the above finding of the Commissioner. 4.2.2. We have carefully considered the pleas advanced from both sides. We agree with the ld. Advocate for the appellant that Rule 2 (2) (viii) of the Valuation Rules, 1988 does not cover within its sco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be accepted. He submits that it is settled position in law that price contracted between a foreign supplier and an importer is a valid normal price of delivery of goods at a later date within the terms of the contract. Ld. Advocate relies for this proposition on Calcutta High Court s judgment in the case of Sneha Traders reported in 1992 (60) E.L.T. 43 (Cal.) . He relies on para 12 thereof, which for better appreciation is reproduced below : 12. When the contract has already been entered into between the parties and such contract was at the prevailing international market price on the date of contract, there can be no question of the foreign supplier being treated as imprudent when he acted in terms of such contract and supplied the materials even though at the time of shipment the prices had gone up. Similarly, the period of supply under the contract is agreed between the parties and the contract itself can never be treated as not genuine on the ground that the supply period is long. In so far as the payment is concerned, sometimes the payment terms provide for opening of letter of credit and sometimes the payment terms may provide for payment against documents and/or afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same supplier under the same contract imported by the appellant but sold on high seas sale basis to a person. `Silpi Exports Revenue has not taken any action whatsoever against those four consignments. But, submits the ld. Advocate, the adjudicating officer has set aside these pleas on a sweeping observation that the goods imported in this case is not of the same quality and specification as that on which reliance has been made on behalf of the importer (appellant herein). The importer has not placed the facts and circumstances relating to each of such imports as to whether the goods are of the same specification and composition as the goods in question and who their manufacturers are. When the actual price is available for import made of identical goods manufactured by the same manufacturer the same cannot be ignored with reference to other imports of goods of different specifications and compositions........ In fact the importer has not made any submission with reference to the said import. The importer has not even filed the manufacturer s invoice to show at what price the shipment in question was made by the manufacturer..... 4.4.5 Ld. Advocate, Shri N.C. Roychowdhu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acturer of the goods or that the grade of the goods in that Bombay print-out does not tally with the grade of the goods actually imported and found on examination, which as per the notings on the reverse of the copies of original Bs/E (forming part of the paper book of the appellant), is 15 NF-P-211 I . We are at a loss to understand these differences in further alphabets and figures P - 211 I actually found on the goods. We also observe from the Bombay Customs House print-out, relied upon by the Commissioner, that grade NF 15" is also general purpose polystyrene resin because the description of goods as given therein is Polystyrene Resin General Purpose Grade NF 15." It cannot, therefore, be said, as appears to be the impression of the ld. Commissioner that the goods contracted for and invoiced are different from the goods actually imported. We, therefore, hold that the declared value of the goods has not been proved to be wrong by the Revenue. 5.1.1 Next issue before us is whether the benefit of Notification 203/92-Cus., dated 19-5-1992 would be available to the appellant firm. On this issue, the adjudicating officer has observed that the Customs authorities can grant exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Policy 1992-97. He submits that Notification 203/92-Cus. has been issued to effectuate the Exim Policy 1992-97 as contained in Chapter VII thereof under the heading `Duty Exemption Scheme . This is also apparent from the opening para of Notification 203/92-Cus. which ........exempts materials imported into India, against a Value Based Advance License,....... in terms of para 49 of the Export Import Policy (1st April 1992 - 31st March 1997), from the whole of the duty of Customs .......subject to the following conditions, namely, ...... . He further points out that the appellant is not the original licence-holder who is required to fulfil export obligation. A transferee of a VBAL, as the appellant is, is required to fulfil only condition (vii) of the Notification, which is reproduced below :- Where benefit of the Notification is sought by a person other than licensee, such benefit shall be allowed against the said license and the said certificate only if it bears endorsement of transferability by the Licensing Authority. He also invites our attention to para 67 of the Exim Policy relevant extracts from which are reproduced below :- Transferability of Advance License : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or that the particular grade of PS imported is required for export product i.e. TVs. 5.3.1 We have carefully considered the pleas advanced from both sides. We observe from a plain reading of the Exim Policy 1992-97, Chapter VII thereof containing the duty Exemption Scheme and the Notification 203/92-Cus., that it is a composite scheme; primary responsibility for monitoring the same rests with the L.A.. It is for this reason that the EXIM Policy was announced first on 1-4-1997 and the Notification 203/92-Cus dated 19-5-1992 contains references to the VBAL (issued under the said scheme). The Notification speaks `materials imported are covered by a VBAL and DEEC issued by the L.A. [c.f. condition (i)]. Importer produces proof of having executed a bond or Legal Undertaking (LUT) before the L.A. concerned for complying with the condition of the Notification [c.f. condition (ii)], No double clause (b) of condition (ii) also casts a duty on the importer to give a declaration before the Assistant Commissioner of Customs binding himself to pay on demand equal to the duty leviable but for the exemption. Proviso to condition (ii), however makes it clear that the bond/LUT or the declaration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been held by the lower authority as not proved to having been fulfilled, can be satisfied by the original licensee whose duty is to discharge the export obligation. In other words, this could be proved by Samtel India Ltd. and Jolly Television Ltd.. No burden of proving condition No. (v) can be thrown on the appellant who comes into the picture after endorsement of transferability of the license by the L.A.. Presumption would be that the L.A. has satisfied itself about fulfilment of condition No. (v) before making endorsements of transferability on the license and the certificate. Condition No. (vii) alone governs the import made by a transferee licensee which is not disputed by the Revenue to have been satisfied in the present case. Similarly, the nexus between the imported material and the export product is not required to be proved afresh by a transferee licensee, once the material is otherwise covered by the VBAL and/or DEEC. There is no doubt about it inasmuch as it is not disputed that PS granules/moulding powder are covered by the VBAL. We are fortified in our above conclusions by Tribunal s two judgments as follows :- (1) Nitco Marble Granite (P) Ltd. v. Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mported goods are comparable with similar other imports at Calcutta. Therefore, reliance placed by the Commissioner on a single example in Madras Customs House print-out, which does not indicate the date of contract, is not of such a weight as to displace the worth of evidence produced by the appellant. Another document relied upon by the Commissioner is an instance of import by an importer in Nepal through Calcutta Port in transit. This evidence cannot be relied upon in terms of Rule 8 (2) (iv) of the Valuation Rules, as rightly pointed out by the ld. Advocate for the appellant. Another document relied upon by the Commissioner is a so-called quotation addressed to the Assistant Commissioner SIB. Ld. Advocate rightly points out that this document is at once unworthy of reliance because (i) it is not signed by any one; (ii) it relates to a period long after the relevant period; (iii) validity of the quotation is just for two days ; (iv) no import has been shown to have been made against the said quotation. We are, therefore, of the view that the appellant has been able to successfully rebut the evidence of the Revenue as being unworthy of reliance and prove his case with his own evi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
