TMI Blog2016 (12) TMI 1157X X X X Extracts X X X X X X X X Extracts X X X X ..... ove judgments it can be observed that products are identical i.e. Pioneer brand speakers, the facts such as product specification, declared price, enhanced price, evidences such as quotation, price available on website etc. are identical therefore aforesaid judgment is directly applicable in the present case. Taking into consideration the overall facts and aforesaid judgment, we are of the view that lower authorities have rightly enhanced the value and confirmed the differential duty. Since the appellants deliberately suppressed the value by mis-declaring, the goods were liable for confiscation. Though the redemption fine was not imposed, for purpose of imposition of penalty, availability of the goods which was liable for confiscation is not necessary, therefore penalty was rightly imposed in lieu of confiscation. Since differential duty rightly confirmed under proviso to Section 28 (1) of the Customs Act, penalty imposed under Section 114A is inevitable. As per our above discussion and the settled legal position, the impugned orders are upheld and appeals are dismissed. Appeal No. C/1349/05 - appeal of Star Audio - stands abated for the reason of demise of proprietor of the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ii) TS-A 6995(Made in China) DHS 230.00 each pair-100 pair On further checking of price on the official website of Brand owner M/s. Pioneer Corporation, Japan the following prices are available on website: (a) TSA 6955 Price not available (b) TSA 6965 US$ 90.00 (c) TSA 6975 US$ 110.00 (d) TSA 6985 US$ 140.00 the price of impugned (e) TSA 6995 US$ 170.00 goods As per analysis of the quote in the proforma invoice and the price print out obtained from the website www.jackys.com following price were revealed. Mode Model No. Country Qty Port Value per pair Value in US$ Internet TSA 6955 - W/sale Dubai 147 Dhs 39.69 Internet TSA 6985 W/sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty under section 114A was imposed. Aggrieved by the impugned order, appellants are before us. 3. Shri. Jitu Motwani, Ld. Advocate for Newteck and Star audio, Shri. D.H. Nadkarni, Advocate for Laxmi Enterprise and Orient Impex, Shri. C.S. Birasdar, Advocate for Bright Impex and Hari Om Electronics, None for M/s. Merico and Continental traders. They made following submissions. (a) The entire case of undervaluation was made out on the basis of quotation said to have been obtained from Dubai based dealer. The quotation is in the name of the officer and same is unsigned but the same was received by fax, therefore the authenticity of the said quotation itself doubtful. (b) The quotation relied upon by the revenue was obtained six months before the import of the goods. The impugned goods being electronic goods, the price of the electronic goods can be reduced very fast, this is general trend of the market of the electronics goods therefore the six months old quotation cannot be relied upon when the goods imported six months later. All the goods not imported from Dubai but also from the Hong Kong and Singapore whereas for all the cases the reliance was placed on the quotation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is not the case where the value was enhanced arbitrarily and without any basis. He submits that there is no bar in enhancement of the value even when the price was once enhanced at the time of clearance of the goods. He submits that in the present case there is clear suppression of actual value of the goods and in investigation the actual price was revealed. In such situation since actual price of the goods was not made available before the customs authority at the time of the assessment, the department is free to enhance the value as and when fresh evidences are available to the department therefore even once the value was enhanced the subsequent enhancement of the value on the basis of the evidence made available by investigation is in order. He submits that as regard the submission of the appellant that goods are imported not only from Dubai, but also from Hong Kong and Singapore, he submits that in present case in respect of the goods, the country of origin is either China, Thailand, Japan and Maxico. Therefore the country from where the goods were supplied is immaterial. The product is established pioneer brand goods having particular specification, such goods are available ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 80 N.A. 39.69 Sun City 37.80 TS-A6985-6 x9 -260 w US $ 9.50 58.05 140.0 57.51 58.05 TS-A6995-6 x9 -300 w US $ 10.00 62.10 170.0 67.50 62.10 2. M/s. Hari Om Electronics TS-A6955-6 x9 -220 w US $ 9.00 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6 x9 -260 w US $ 9.50 58.05 140.0 57.51 58.05 3. M/s. Ocean Intl. TS-A6955-6 x9 -220 w US $ 15 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6 x9 -260 w US $ 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 57.51 58.05 TS-A6995-6 x9 -300 w US $ 10.00 62.10 170.0 67.50 62.10 8. M/s. Laxmi Enterprises TS-A6955-6 x9 -220 w US $ 10.20 37.80 N.A. 39.69 Sun City 37.80 TS-A6985-6 x9 -260 w US $ 10.40 58.05 140.0 57.51 58.05 TS-A6995-6 x9 -300 w US $ 10.60 62.10 170.0 67.50 62.10 As regard the submission of the Ld. Counsel that the price was enhanced at the time of the assessment of the Bill of Entry on the basis of contemporaneous import, we are of the clear view that at the time of assessment of Bill of Entry whatever material was available, proper officer relying those material assessed the Bill of Entry by enhancing value. However, at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t US $ 14,391 CIF and filed a bill of entry for their clearance. They were assessed to duty enhancing the value from US $ 9 to US $ 11.60 per pair in respect of one model, US $ 9 to 11.74 per pair in respect of another and US $ 9 to 11.81 per pair in respect of the third one. This revision of value is in accordance with a formula invented by the Commissioner of Customs, Mumbai. The formula is contained in a letter dt. 11-1-2003 by the Commissioner addressed to the Chief Commissioner. We append the letter to this order so that we don t have to reproduce its contents here. After the bill of entry was assessed the goods were examined by the shed appraiser in the presence of officers of C.I.U. Such an examination resulted in the discovery that the consignment consisted of three different models, of three different sizes and wattage. The model numbers are TS-A 6955, TS-A6985 and TS-A6995. The invoice doesn t speak of any TS though. The goods were seized on the ground that the importers mis-declared the value and material particulars. The goods were imported from a trader in Dubai. Apart from the brand, the sizes and the wattage no other technical details of each of the models are eith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce any worthwhile evidence. Puja Poly Plastics Pvt. Ltd. v. CCE, Calcutta [2001 (131) E.L.T. 200 (Tri.)] and Sounds N. Images v. CCE [2000 (117) E.L.T. 538 (S.C.)] were relied upon in support of the contention. (g) Price quotations addressed to non-existing parties are not offers for sale under Section 14 of the Customs Act, Priti International v. CCE, Chennai [2001 (137) E.L.T. 184 (Tri.)] is relied upon. (h) Penalties on both the partners of the firm should not have been imposed under Section 114A of the Customs Act, whereas the section provides for imposition of penalty on the importer who contravened the provisions of the Act. 9. The ld. JDR Shri R.K Pardesi strongly supported the impugned order in so far as it related to confiscation of goods, rejection of transaction value and imposition of penalties on the partners of the firm. His grouse is confined to non-imposition of penalty on the firm as well. 10. In support of his contention that prices indicated in a quotation can be relied upon to reject a declared price the ld. JDR found support in the case of Hind Industries v. Commissioner [1997 (90) E.L.T. 499 (Tri.)]. An appeal against this d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bai addressed to the Chief Commissioner which according to the appellants formed the basis of Valuation of car speakers in earlier imports he argued that the circular clearly speaks of rejection of the basis stated therein if evidence of higher prices is brought out. The department is not bound to adopt the norms prescribed in the letter cited supra in all cases and particularly so when evidence of higher values is gathered. 15. He distinguished the case of Aggarwal Distributors cited supra wherein the Tribunal held that internet prices cannot be relied upon to reject the transaction value. In the present case the internet price relied upon is a wholesale price unlike the ones in the above said case. In Aggarwal s case there was no indication as to whether the internet price was wholesale price or a retail one. He averred that the impugned order he upheld in regard to enhancement of value of the imported goods, confiscation of the goods and imposition of penalties. 16. On the issue whether penalty can be imposed on the firm as well on its partners the ld. JDR argued that a firm is an association of persons and is distinct from its partners. A penalty can be imposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adoption and not those mentioned in some letter of some Commissioner irrespective of the fact that evidence of higher prices is brought to the notice of the department. In fact the basis of valuation of car speakers enunciated in the said letter can be easily challenged on the ground that it is not in accordance with Valuation Rules. 19. The letter under reference is nothing much to talk about. Determining prices of car speakers on the basis of their sizes and their out put ignoring other specifications such as the size of the woofer, midranges and Dom tweeter, frequency response etc., is to say the least appears, looks archaic. That perhaps is the reason while the department wished to reopen the past clearances in the light of evidence gathered by the department. And rightly so. Apart from the fact that Valuation Rules do not permit the customs authorities to revise declared prices by adopting the methods suggested in the said letter the method itself is irrational. It has no statutory backing. Further it provides escape clauses such as the ones mentioned elsewhere in this order. There is no gain saying the fact that the goods under import have different specifications ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng as the quotations themselves are tendered as evidence, the appellant had opportunity to demolish them by producing evidence in their favour. They did not avail of the opportunity except asking for cross-examination of the officers concerned. We have the authority of the decision of the Tribunal in the case of Satellite Engineering Ltd. relied upon by the ld. JDR, which held that non-disclosure of intending importers and not producing them for cross-examination will not amount to violation of natural justice. 24 .The Commissioner has also considered the prices indicated in the internet, which are wholesale prices, to determine the prices at which the impugned goods are ordinarily sold in the course of international trade. At page 9 of the impugned order the Commissioner analyses as to how the prices indicated in the internet compare well with the ones shown in the quotations from other dealers in Dubai and the distributor of the same goods in that country. For each of the models indicated in the invoice the prices, on enquiry ranged as follows :-Serial No. 1 US $ 37.80 to 39.69; Serial No. 2 US $ 47.50 to 58.05 and Serial No. 3 US $ 53.64 to 67.50. In this range the lowes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e find that such an action is called for in the present case at least for two reasons. The value has been misdeclared so grossly that it attracts the charge of under-valuation. In other words it is not merely an issue where a transaction value is rejected. It is something more. And secondly an attempt to declare prices of all models at 9 US $ CIF per pair definitely constitutes mis-declaration of value. We hold therefore that the goods in question are liable to confiscation under Section 111(m) and persons concerned are liable for penal action under Section 114A of the Customs Act. 29. The Department s appeal is in regard to non-imposition of penalty on the firm. The Commissioner argued that a firm is not a legal entity and therefore no penalty can be imposed on it. According to him a partnership firm is not a legal entity within the meaning of Section 3(42) of the General Clauses Act. The ld. JDR relied on the decision of the Hon ble Supreme Court in the case of Agarwal Trading Corporation Ors. [1983 (13) E.L.T. 1467] and similar other pronouncement by the Tribunal on the issue of imposition of penalties on both the firm and its partners. This Tribunal also held that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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