TMI Blog2016 (4) TMI 882X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned in the invoices was the correct market value of the goods imported at the relevant time. The adjudicating authority in these circumstances was perfectly justified in taking the prices mentioned in the quotations as a basis for determining the correct value of the imported goods. Period of limitation - Appellant contended that declaration regarding the intended re-export was made in the first bill of Entry and the Invoice itself at the time of assessment - Held that:- it is a fact that the Bill of Entry contained the endorsement that it was intended for the purpose of display in exhibition and return thereafter. However it was found to be a misdeclaration as the documents recovered did not show any such intent. Furthermore the fact that it was at a special and highly discounted price was not declared. It is not apparent from the declaration that the import is at a discount of over 80% to the list price. The misdeclaration is alleged, not merely on the basis of the misdeclaration that the goods were for exhibition and return thereafter, but on the basis of the fact that a specially discounted price was declared for the said purpose but not disclosed. It is apparent from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 30/08/95 of M/s. Hitachi Denshi Ltd. addressed to the appellants for various products including the Z-ONE-D Camera for Japanese Yen 9,55,000 per piece. Also recovered was a documents dated 03/08/85 of the appellant claiming that they have to pay money to the officers of BEL, Doordarshan and Ministry of Broadcasting. The appellants had suggested the exporter that in case they wanted to sell goods to these customers, price including additional 10% is to be quoted by Hitachi Camera System. Another documents dated 02/06/94 recovered was letter of M/s. Sansho Co. Ltd. addressed to the appellant regarding delivery of six units of Hitachi KP-C571. The said letter asked following from the appellant: 1) How should we deliver MSAS or other? 2) Is it all right to present our documents to our banker at full invoice value yen 9,30,000? 3) Please instruct about invoice etc. today Another document recovered (Appendix XI to SCN) contained following remarks: Re-Z-ONE-D Price list: We apologize for delay, the draft was already completed and we are just thinking how we can fix the prices. The price of our Hitachi Affiliated Company in USA is as follows: Z- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by way of negotiations are admissible, provided it is not unusual in the course of international trade and the circumstances of the transaction justify a discount. It was alleged that in this case, the manufacturers (M/s. Hitachi Denshi Ltd.) Price Lists dated 6/2/95 and 18/12/95 do not show any discount schedules. The only document which talks about discount is the estimate dated 30/08/95 of M/s. Hitachi Denshi Ltd. This estimate indicates a Special Discount of Japanese Yen 805,400 for purchase of 2 sets of Hitachi Z-ONE-D Cameras. It was alleged that this was a special discount offered only to the particular buyer i.e. M/s. Shimnit and as such would not be admissible. It was alleged that the price indicated in the invoices and corresponding Bs/E thus do not appear to represent the transaction value defined under Rule 4 of CVR, 1988. It was based on the invoices raised by M/s. Sansho co. Ltd., Japan, who in turn were authorised agents of the manufacturers M/s. Hitachi Denshi Ltd. It was highlighted that the total per unit price for complete Hitachi Z-ONE-D Camera System is indicated as Japanese Yen 955000 FOB, Japan, in both the Price Lists dated 6/2/95 and 18/12/95 of M/s.Hitac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these price lists dated 8/2/95 and 18/12/95 (Appendix VI VIII) were taken to indicate the actual prices of the Hitachi Z-ONE-D Camera systems and accessories imported by the Noticee M/s. Shimnit Machine Tools and Equipments Ltd., Mumbai under various Bills of Entry. These prices were taken to be the correct prices of imported goods under Rule 8 of CVR. Duty evaded on the basis of these arguments, for each bill of entry was worked to ₹ 55,95,830/- 2.5 On the basis of above a notice was issued; i) Seeking rejection and re-fixing of transaction value ii) Determination of value under Rule 8 iii) Demand of differential duty invoking extended period and interest thereon iv) Confiscation of imported goods v) Penalty on two firms under Section 114A vi) Penalty on Shri Nitin Shah 3. The learned Counsel argued that price list even if true cannot be basis of rejecting the price declared by them. For this they relied on decision of Hon ble Supreme Court in the case of Eicher Tractors Vs. CC - 2000 (122) ELT 321 (SC). In the said decision, the Hon ble Supreme Court has observed as follows: 22. In the case before us, it is not alleged? that the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound that the invoice submitted by the importer was incorrect. In Eicher Tractors (supra) this Court observed that Rule 4(1) of the Customs Valuation Rules refers to the transaction value. Utilization of the word the as definite article indicated that what should be accepted as the transaction value for the purpose of assessment under the Customs Act is the price actually paid by the importer for the particular transaction, unless it is unacceptable for the reasons set out in Rule 4(2). In the said judgment, it has been further held that, the word payable in Rule 4(1) also refers to the transaction value and payability in respect of the transaction envisaged a situation where payment of price stood deferred. Therefore, this decision of the Supreme Court directs the Revenue to decide the validity of the particular value instead of rejecting the transaction value. We wish, however, to clarify that it is still open to the Department based on evidence, to show that the declared price is not the price at which like goods are sold or offered for sale ordinarily, which words occur in Section 14(1). Lastly, it is important to note that in the above decision of this Court in Eicher Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Delhi, Ramgopal Lachmi Narayan, Bombay, Sanmukh Engineering Industries, etc. had also imported comparable quantities of similar bearings at the same or lesser prices as that of Mirah Exports and that discount from 50% to 70% on the list prices was the normal invoice price for a number of unconnected importers during the period. The Collector of Customs, while passing the orders dated December 5, 1986 and March 20, 1987 and the Tribunal in the impugned judgment have not taken note of the said documents and the fact that the importers had been given 50% to 70% discount on the prices indicated in the list price. 3.3 The learned Counsel also argued that extended period cannot be invoked in this case. He argued that they had declared in their first import documents that the goods were intended for display in the exhibition and re-export after the exhibition. The fact that they sold the said goods at much higher price domestically is irrelevant. It was also argued that the even if the extended period is invoked for the first import the same cannot be invoked for subsequent imports. 3.4 The learned counsel, during the hearing on 18th February, 2016, specially held for clarificatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ually paid or payable for the goods when sold for export to India, adjusted in accordance with the provisions of Rule 9 of these rules. (2) The transaction value of imported goods under sub-rule (1) above shall be accepted; Provided that - (a) - (b) the sale or price is not subject to same condition or consideration for which a value cannot be determined in respect of the goods being valued; (c) - (d) - (3) - From the rule it is clear that if the imports are for any specific consideration the declared price can be rejected. In this case the import was at a special price for the purpose of display in exhibition for the purpose of promotion of sales. In these circumstances this cannot be called the ordinary price which is available to every importer. This by itself is a good reason to reject the declared sales price. The Hon ble Supreme Court in the case of Padia Sales Corporation - 1993 (66) ELT 35 (SC)has observed as under: 4. We have been taken through the order of the Collector and of the Tribunal. We have also examined the correspondence placed on the record. The trade representative of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en. Also recovered in the search was an Estimate dated 30/08/95 of M/s. Hitachi Denshi Ltd. addressed to the appellants for various products including the Z-ONE-D Camera for Japanese Yen 9,55,000 per piece. This document which is dated 30.8.95 (the day after the meeting for modalities of supplies for the exhibition on 29.8.1995) specifically mentions the discount that was being offered by Hitachi Denshi Ltd to the appellants. Here only a lump sum discount of Japanese Yen 8,05,000/- was offered on a total invoice value of Yen 3,108,000/-(Appendix VII to SCN). Thus it is seen that the real price for supply were as per the estimate dated 30.8.95 given by the manufacturer Hitashi Denshi following the meeting dated 29.8.95. Also recovered during search was a documents dated 03/08/95 (Appendix IX to SCN) of the appellant, addressed to M/s Hiteshi Denshi, claiming that they have to pay money to the officers of BEL, Doordarshan and Ministry of Broadcasting, therefore, in case they wanted to sell goods to these customers price including this 10% is to be quoted. Another documents dated 02/06/94 recovered was letter of M/s. Sansho Co. Ltd. addressed to the appellant regarding delivery of six ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty discounts to the extent of 50 to 70 % are normal in course of International trade. It is seen that the Honble Supreme Court had made that observation on the basis of numerous other contemperenous imports of same commodity by other importers at that kind of discounts. In the instant case no such evidence has been produced. 5.5 In these circumstances the declared prices have been rightly rejected. The appellants have asserted that price list/quotation, by itself cannot be treated as contemporaneous import. They asserted that the price list of the 1995 can certainly not be treated as contemporaneous for the imports made in 1997 and 1998. Having rejected the declared price under rule 4, the learned counsel argued that the authorities should have proceeded sequentially from rule 4 onwards for determination of the value. For this purpose the appellants have relied on the the decision of Honble Supreme Court in case of South India Television Vs CC Calcutta 2007 (214) ELT 3 (SC). It is seen that the impugned order notes that the contemporaneous imports of the similar or identical goods are not available. The appellants have argued that there is no evidence of any such enquiry. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of each other and the price is the sole consideration for the sale or offer for sale. In the present case the company itself had produced a copy of the quotations received by them from M/s. Shun Hing Technology Ltd., Hongkong in respect of the copiers and other items imported alongwith their application for approval of their phased manufacturing programme. The company itself having produced these quotations, they cannot dispute the correctness of the prices mentioned therein. The company has not only not disputed the correctness of these quotations but has not produced any other material on record to show that the value mentioned in the invoices was the correct market value of the goods imported at the relevant time. The adjudicating authority in these circumstances was perfectly justified in taking the prices mentioned in the quotations as a basis for determining the correct value of the imported goods. It can be seen from aforesaid observation of Honble Supreme Court that in the circumstances where quotations are available the same can be relied if the importer is not able to produce any other material on record to show that the value mentioned in the invoices was the correct ..... X X X X Extracts X X X X X X X X Extracts X X X X
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