9911796707
TMI Blog2022 (6) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... with M/s Harshul Enterprises, had been charged with import of television sets, video compact disc (VCD) players and music system in disassembled form, as well as that of Mr Ramesh Mehta, the Director in the company. Under challenge are the confirmation of differential duty of Rs. 22,76,475, fine of Rs. 12,50,000 imposed under section 125 of Customs Act, 1962 in lieu of goods held as liable for confiscation under section 111(m) of Customs Act, 1962 and penalty of Rs. 2,00,000 each on the sole proprietor and the company and Rs. 1,00,000 on the Director of the company 3. The allegation in show cause notice dated 30th September 2005 flow from bills of entry no. 352399/28.04.03 and no. 352403/28.04.03, declaring 'electronic components/parts' valued at Rs. 2,49,946.96 and Rs. 3,95,195.39 filed by M/s Arigato & Obligado Merchandise Pvt Ltd and M/s Ankit Enterprises respectively, which were found to contain 838 pieces and 250 pieces respectively of branded and unbranded parts of television sets, video compact disc (VCD) players and music systems that complemented one another for assembly of fixed number of such sets, players and systems. Investigations found that the two consignments had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terprises and M/s Arigato and Obligado Merchandise Pvt. Ltd were examined by the Sony's Engineer. After examination he opined that in case of TV and VCD players except for the cabinets all other components were available that would make the complete units. In the case of Music System except for the speakers and cabinets all other components were available that would make the complete units of the Music System. xxxxx 51. Statements of employees of M/s Sai Dutt Clearing Agency show that Shri A. K. Dham gave the false statement on 6.08.04 that is employees had stamped and signed as authorized signatory for M/s Ankit Enterprises and M/s Arigato and Obligado Merchandise Pvt Ltd. As same person had signed for authorized signatory of both the firms it reveals that these firms were signing the Bills of Lading of each other which indicates that the firms are either related to each other or controlled by one person. Scrutiny of the Xerox copy of employee's muster roll for the month of April 2003 showing the signatures of employees of M/s Sai Dutt Clearing Agency also revealed that signatures of the employees of M/s Sai Dutt Clearing Agency on the muster roll do not tally with the signatu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suspect xxxxx 56.... Therefore, impugned goods can only be assessed by resorting to 'best judgement' method under rule 8 of the Customs Valuation Rules, 1988. 57. To arrive at assessable value, the price of M/s Sony Pvt. Ltd in Singapore were therefore studied and compared with the MRP of the identical goods in India. On comparing the prices of the four items... where both Singapore price and MRP are available, it is found that MRP is on average 73.12% more than Singapore price. Since Singapore price of Sony TV KV-XJ 29 M 50, KV-XG 25 P 50, and Samsung VCD Player Z-850 could not be ascertained the same ratio was applied to determine the value of these three models in Singapore.' to which were added dealer's profit, dismantling charges, freight and insurance, and landing charges to arrive at the assessable value in the proposal for recovery of differential duty and imposition of penalties in the show cause notice. Furthermore, additional duties of customs were also proposed to be recovered. 4. The impugned order has redetermined the assessable value of all five consignments, taken together, to be Rs. 51,67,563 instead of Rs. 10,58,677.35, the sum of the amounts declared in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed valiantly to convince us of their perspective of the impugned dispute; not unnaturally, these have been built, both for and against, upon the perspective offered by the original authority in the impugned order. We have no doubt that a plodding start from the 'zero point', or from first principles, may appear less glamorous than jumping of the deep end at some point along the axes, or even within the quadrant, but there is, at least, the assurance that the path taken is straight and true. Therefore, we will revert to the arguments placed before us, including the citations, only if warranted as we proceed to resolve this issue by reference to the law which, in our opinion, has been discarded, from the very commencement of investigations, in favour of emotive justification. 8. That the goods imported, even as 'parts', could be assembled into television sets, video compact disc (VCD) players and music systems is not particularly controverted by any of the three importers - of whom one was not concerned with the assessment that featured in the leap of the investigators - placed on notice in the proceedings leading to the impugned order. However, that, in the world of commerce, an en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... veral guidelines, inter alia, General Rules for the Interpretation of the Import Tariff. Valuation, on the other hand, is governed by the Rules notified under the authority of section 14 of Customs Act, 1962 for application to situations in which the conceptual framework or the 'gold standard', as the case may be, is not discernible in the declared price. Even if the classificatory engagement requires 'parts'- taken together - to be deemed to be 'finished products' for deployment of appropriate rate of duty in assessment, such consummation does not, save under the grace of section 14 of Customs Act, 1962 or the Rules framed thereunder, have any bearing on valuation for assessment. Indeed, even such an unlikely proposition is not canvassed by Revenue, either in the impugned order or in the submissions of Learned Authorized Representative. And, therein lies the allure of the deep end. The interpretative instruments, invoked for section 12 of Customs Act, 1962 and betokening yet to be achieved form of imported goods, has been unleashed for obscuring its actual state with the deemed state, undoubtedly not in conformity with the declared description, deployed to invoke rule 10 of Custom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Tri-Del)] besides an order of the Settlement Commission. 14. Learned Authorized Representative has, while placing these decisions on record, also drawn attention to the affirmation of these by the Hon'ble Supreme Court, and further cited the decisions of the Hon'ble Supreme Court in Commissioner of Customs (Import), Mumbai v. Pundrick Ravindra Trivedi [2015 (322) ELT 812 (SC)] which had set aside the finding of the Tribunal in the matter relating to 'clubbing' of clearances by distinguishing the applicability of the decision of the Hon'ble Supreme Court in Commissioner of Customs, New Delhi v. Sony India Limited [(2008) 13 SCC 145] that had upheld the decision of the Tribunal in Sony India Ltd v. Commissioner of Customs, ICD, New Delhi [2002 (143) ELT 411 (Tri-LB)] on which reliance had been placed for setting aside the clubbing ordered by the original authority in Savaram D Patel v. Commissioner of Customs, Ahmedabad [2014 (312) ELT 193 (Tri-Ahmd)]. Likewise, reliance was also placed on the decision of the Hon'ble Supreme Court in Commissioner of Customs, New Delhi v. Phoenix International Ltd [2007 (216) ELT 503 (SC)] to support the correctness of the position adopted by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccepted the aforesaid arrangement as disclosed by Mr. Patel and Mr. Soni and admitted that it is he who was calling the shots and, in fact, was actual importer of the material in question... He also stated that these goods were offered to him in SKD condition and he imported the same vide different Bills of Entries for tax management purpose. xxxx 18. In the light of these facts backed by solid evidence, the Tribunal committed grave error in ignoring these facts and allow the appeal by simply relying upon the case of Sony India Ltd. (supra). 19. We may point out that the aforesaid decision of the Tribunal in Sony India Ltd. (supra) has been affirmed by this Court... However, the distinguishing feature can be discerned from Paris 13 and 14, which we reproduce below : 20. It is clear from the above that in Sony India Limited (supra) what was found that there was no allegation of fraud and there was also absence of any subterfuge. On this basis, earlier judgement of the Supreme Court itself in Phoenix International Ltd. (supra) was distinguished. We find that the present case is more akin to the facts of Phoenix International Ltd. (supra).' 17. From the findings supra, it emer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... occurred to the adjudicating authority. 20. The impugned order has rendered a finding that the goods, even if imported by different entities, were sought to be cleared, in concert with one another, after disassembling in Singapore. There are obvious gaps in this tale that the principle of 'preponderance of probability' may not bridge. The conclusion that '84. In the instant case all the consignments have come virtually at the same time, i.e. within gap of 3 days. Had they been presented together before the customs officer the subterfuge could have been easily detected. The 3 importers deliberately chose to file Bills of Entry on different dates to mislead and confuse the customs officers. Had they presented these items together they would have been assessed as complete consumer electronic items and the CVD would have to be discharged on specific rates or on MRP basis.... The whole exercise was therefore a colourable device to evade taxes. They try to do something indirectly which they were not permitted to do directly.... xxxx 86. SONY has confirmed that they do not sell components parts of their electronic consumer items anywhere in the world and that the supplier in Singap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... signed for levy of duty on imported goods. The consistent thread in the several decisions cited by both sides is the applicability of the framework for assessment and permitting reconstructed depiction solely on evidence of attempted subterfuge. A motive must clearly be proved. The motive should also display disproportionate windfall from such subterfuge. Neither is on record here. The goods have been imported, and presented, separately and independently; no evidence, other than conjecture about the conspiracy to disassemble branded products, is on record. None of the judicial decisions approve the contrived combining of separate imports in circumstances of lack of evidence of admitted conspiracy and, to accord judicial approval here, would be to open Pandora's box of lack of certainty, lack of consistency and lack of consummation insofar as clearance of imported goods are concerned. 23. The impugned order fails on the test of law and, therefore, the appeals of M/s Arigato and Obligado Merchandise Pvt Ltd, Mr Devendra Ahuja, and Mr Ramesh Mehta are, thus, allowed. In view of these facts and circumstances, the appeal of Revenue stands dismissed. (Order pronounced in the open court ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
