TMI Blog2017 (4) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... be accepted for the purpose of determining the transactions. The Invoice No.KSS01 9903/370 dt. 10-10-2003 of Kalmart Systems (Malaysia) for unit value of US$ 397.50 PMT and Invoice No.MA046/10103 dt. 14-10-2003 of Mamba Sdn Bhd (Malaysia) for unit value of USD 385.00 will have to be necessarily taken as the correct invoice and transaction value and consequently for determination of assessable value in respect of goods covered by B/E No.550460 and 551112 respectively. These would be the correct prices paid or payable for the purposes of Rule 4 (1) of the Customs Valuation Rules, 1988. Appeal dismissed - decided against appellant. - C/474/2004 & C/475/2004 - 40529-40530/2017 - Dated:- 24-3-2017 - Shri D.N. Panda, Judicial Member And Shri Madhu Mohan Damodhar, Technical Member Shri S. Murugappan, Advocate For the Appellant Shri K. Veerabhadra Reddy, JC (AR) For the Respondent ORDER Per Madhu Mohan Damodhar Brief facts of the case are that M/s.Karnataka Soaps Detergents Ltd., the first named appellant herein (hereinafter referred to as KSDL ) filed two Bills of Entry No.550460 dated 05.11.2003 and No.551112 dated 07-11-2003 respectively for cleara ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. (viii) Taking the Transaction Values mentioned above and adding actual Freight and the Insurance amounts plus 1% Commission, the total assessable value of the goods imported under the Bills of Entry No.550460 dated 05.11.2003 and No.551112 dated 07.11.2003 were liable to be determined at ₹ 19,21,664/- and ₹ 20,04,593/- respectively. 3.2 Against request of General Foods Limited, Chennai made on 24.11.2003 and 25.11.2003 for release of the goods against Bank Guarantee for the differential duty amount pending enquiry/verification provisionally and if BG was not acceptable, such release to be allowed on payment of differential duly under protest, Authority ordered provisional release of the goods. 3.3 The goods covered by Bill of Entry No.550460 dated 05.11.2003 were released provisionally on execution of test bond and on payment of duty under protest adopting the price USD 408.613 (C F) taking FOB as USD 397.5 PMT. 3.4 The goods covered by Bill of Entry No.551112 dated 07.11.2003 were also released provisionally on execution of test bond and on payment of duty under protest by adopting the price of USD 396.58 (C F) taking FOB as USD 385.00 PMT. 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Rule 4 of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988. Total assessable value of the goods was determined at ₹ 20,04,593/- (Rupees Twenty Lakh Four Thousand Five Hundred and Ninety Three only) and accordingly assessed. (b) Duty of ₹ 10,18,333/- was levied and amount of ₹ 10,18,334/- (Admitted duty of ₹ 7,73,174/- + Provisional Differential duty of ₹ 2,45,159/-) paid provisionally was adjusted/appropriated against the total duty demand; 5.4 The goods imported being misdeclared, that was confiscated under Section 111 (m) of the Customs Act, 1962 imposing redemption fine of ₹ 2,00,000/-. 5.5 Penalty of ₹ 1,00,000/- each were imposed on the importer M/s. Karnataka Soaps Detergents Ltd., and the High Seas Seller, M/s. General Foods Limited, respectively. 5.6 Lower authority in para 25 (vii) of the impugned adjudication order has also analysed the applicability of Board's Circular No.32/2004 dated 11-05-2004 with regard to appellant's reliance thereon in the context of acceptance of High sea sales price as under: The Central Board of Excise Customs, New Delhi in its Circular N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Customs Act, 1962 and Rule 4 (1) of the Customs Valuation Rules, 1988 in itself emerges as transaction value acceptable under Rule 4 (2) ibid. It is well settled in law that when manufacturer's invoice is available and is genuine, it is the best evidence of the price of the imported goods and in that case there is no need to go to other contemporaneous imports of identical or similar goods, etc. In this regard, I place reliance on the decision of the Hon'ble CEGAT in the case of Sai Impex Vs Collector of Customs 1992 (62) ELT 616 (Tri.) which was confirmed by the Hon'ble Supreme Court in the case of Collector of Customs Vs Sai Impex 1996 (84) ELT 47 (SC) and on the decision of the CESTAT in Finacord Chemicals (P) Ltd. Vs Commissioner of Customs, Raigad 2003 (157) ELT 537 (Tri.). In the present case, in place of manufacturer's invoice, the invoice issued by the original supplier-exporter of the country wherefrom the goods were sold for export is available which is undisputedly authentic and genuine and as good as manufacturer's invoice in the facts and circumstances of the present case and is therefore, the best evidence of the price paid or payabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that high seas sales prices should be higher in the ordinary course than the price paid to the exporter abroad. These are nothing but presumptions and there is no law stating that the high seas sales price should be higher than the price paid to the exporter abroad. (e) The adjudicating authority has made a fatal error when in para 25 (v) of the impugned order in concluding that invoice prices shown in the supply invoices of the Malaysian manufacturers raised on Aavanti Industries Pte Ltd., Singapore are the prices which were actually paid or payable for the goods sold for export to India by the Malaysian exporter concerned. The adjudicating authority has completely lost sight of the fact that those invoices are confined to the transaction between the Malaysian supplier and the Singapore buyer. These invoices are raised on the Singapore buyer for the supplies received by them. Thus, these invoices refer to a transaction between a Malaysian party and a Singapore importer. It has also happened that the same consignment has been resold by the Singapore buyer to the Indian importer viz. General Foods Ltd. Therefore, what is relevant to be considered as price for export to India is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Invoice No.KSS019903/370 dt. 10-10-2003 of Kalmart Systems, Malaysia to M/s. Aavanti Industries, Singapore Qty : 101.230 MTs Unit rice=USD 397.50 PMT (FOB Port Klang) Amount=USD40238.93 B/L : NOVPKGCHE0210 Dt.10-10-2003 SO1/70/045454 dt. 22-10-2003 of M/s. Aavanti Industries, Singapore 108.780 MTs Unit price= USD 301.00 (C F) Amount= USD 32742.78 B/L: NOVPKGCHE4210 dt.17-10-2003 For 108.780 MTs corresponding Invoice No.MA046/10/03 dt. 14-10-2003 of MAMBA SDN BHD, Malaysia to M/s. Aavanti Industries, Bangalore Qty : 108.780 MTs Unit Price=USD 85.00 PMT (FOB Port Klang) Amount=USD 41880.30 BILL OF LADING No.NOVPKGCHE0210 dt.10-10-2003 Port of loading: Port Klang, Malaysia Shipper : M/s. Kalmart Systems, Malaysia No.NOVPKGCHE4210 dt.17-10-2003 Port of loading: Port Klang, Malaysia Shipper : M/s. MAMBA SDN BHD, Malaysia CERTIFICATE OF ORIGIN KUALALUMPUR SELANGOR INDIAN CHAMBER OF COMMERCE INDUSTRY dt. 17-10-2003. EXPORTER : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rges that this invoice has actually been issued by Kalmart Systems (Malaysia) SDN BHD, Malaysia to Aavanti Industries Pte. Ltd., Singapore at unit price of US$ 397.50 PMT (FOB) and total amount is US$ 40238.93. However, the destination is not shown as Malaysia to Singapore but as SHIPPED FROM PORT KLANG, MALAYSIA TO CHENNAI, INDIA . This fact is also confirmed by the Invoice for ocean freight dt. 10-10-2003 issued by M/s.Eagle Transworld Shipping Lines where the port of loading is indicated as PORT KLANG and port of discharge as CHENNAI, INDIA . It therefore transpires that the very same consignment of 101.230 MTs of Palm Kernel Fatty Acid Distillate in the same containers/flexi bags shown as invoiced by M/s.Kalmart Systems, Malaysia to M/s.Aavanti Industries, Singapore, nonetheless were shipped directly by Kalmart Systems to General Foods Ltd., Chennai. There is no dispute on these facts. 13. Similarly, in case of goods imported vide Bill of Entry No.551112 dated 07-11-2003, though the importers had submitted invoice No.SO1/70/045454 dt. 22-10-2003 of Aavanti Industries Pte.Ltd., Singapore, the Bill of Lading shows the shipper as M/s.MAMBA SDN BHD, Malaysia pertaining to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ost component. 14.4 It is therefore but evident that this is only a paper trial created by the players involved to create a subterfuge that the value of the goods imported is only US$ 301.00 PMT. 14.5 Discernably, elaborate planning has gone into the entire modus operandi right from the creation of High Seas Sale Agreements dated 13-10-2003 and 21-10-2003 between General Foods Ltd. (now Ruchi Soya) and KSDL, in the Contract between General Foods Ltd. (now Ruchi Soya) and Aavanti Industries, Singapore dated 28-03-2003 and in the Purchase Order dated 12-06-2003 of KSDL with General Foods Ltd., the entire exercise culminating in all invoices No.SO1/70/045445 dt. 17-10-2003 and SO1/70/045454 dt. 22-10-2003 both being issued by Aavanti Industries Pte. Ltd., Singapore for supply of the impugned goods at US$ 301 PMT only. 14.6 But notwithstanding their best efforts at camouflage and subterfuge, the proof that impugned goods have actually been invoiced and sent by Kalmart Systems (Malaysia) and Mamba Sdn, Bhd, Malaysia to General Foods Ltd., (now Ruchi Soya), Chennai, which, as found above, has been certified even in the Certificate of Origin accompanying the goods gives the l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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