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TMI Blog2024 (3) TMI 1053X X X X Extracts X X X X X X X X Extracts X X X X ..... s recovered, it was noticed that during the period from 2005-06 the appellant had imported two consignments of Patchouli Oil declaring the same as "Patchouli Oil PS24 (Natural essential oil)" of Indonesian origin, from M/s.K.L.Koh Enterprises Pvt. Ltd., Singapore, the details of which are as under: 2. Scrutiny of the import documents further revealed that the insured value of the goods was higher than the invoice value declared for clearance of the goods. The details of the invoice value and the insured value of the goods declared in both the Bills-of-Entry are as below : - 3. The officers ascertained the value of contemporaneous imports of Patchouli Oil of Singapore origin and found that in few of such imports, the value of the imported goods from the same supplier viz. M/s. K.L. Koh Enterprises Pvt. Ltd., Singapore was found to be higher than the value declared by the appellant, which is furnished below : - 3.1 From the above, it appeared that the appellant has mis-declared the assessable value of the Patchouli Oil during the period between February 2005 and May 2005. As per the value available for contemporaneous imports, USD 33.50/- per kg. appeared to be the ordinary compet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t international price of that grade of Patchouli Oil i.e. PS24. Having not done the verification of the correct price at the time of importation, the department cannot question the correctness of the declared value later. (iii) The enhancement of value of the imported goods from USD 3.25/- per kg. to USD 33.50/- per kg. is not supported by any evidence. The appellant relied upon the decision of the Ld. Commissioner of Customs (Appeals), Chennai in Pushpa Perfumery Products (P) Ltd. reported in 2001 (136) E.L.T. 1005 (Commissioner Appeals) in support of their contention that enhancement of price is not sustainable without ascertaining the quality, commercial level, country of origin, grade, technical literature, test report, etc. of the contemporaneous imports, whose price was proposed to be adopted. (iv) The officers rejected the assessable value declared by them on the value declared by the appellant for the same goods for the insurance purpose was much higher. However, there was no finding in the impugned order to reject the assessable value declared by the appellant. After rejecting the declared assessable value, the Department has adopted the price of contemporaneous impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 (146) E.L.T. 361 (Tri. - Chennai)] which has been upheld by the Hon'ble Supreme Court as reported in 2003 (157) E.L.T. A150 (S.C.). (ix) The appellant further submits that one of their sister concerns M/s. Imperial Fragrances Pvt. Ltd., Kolkata has imported Patchouli Oil, STD and Patchouli Oil Pure SPX from the same manufacturer viz. M/s. K.L. Koh Enterprises Pvt. Ltd., Singapore under Bill-of-Entry No. 276058 dated 20.03.2006. Against this import, the Customs initiated proceedings vide DRI F.No. 97/KOL/APP/2006/Pt.1/2766 dated 03.11.2006. In the said case also, the Show Cause Notice dated 03.11.2006 was issued by DRI and the proceedings were later dropped by the Ld. Addl. Commissioner vide his Order-in-Original No. KOL/CUS/ADC/65/09 dated 05.03.2009, after going through the copy of "International Business Information Service". The documents submitted in that case proves that different grades of Patchouli Oil such as Patchouli Oil pure, Patchouli Oil good, Patchouli Oil Pure SPX, Patchouli Oil STD and Patchouli Oil Iron Free have different values. Accordingly, the appellant submitted that the valuation of one grade of Patchouli Oil cannot be the basis for the assessable value o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the value declared by the appellant for insurance purpose has no relevance for the purpose of assessment of customs duty. There is no evidence on record produced by the investigating officers to the effect that the appellant had actually paid the insured value for the purpose of importation of the impugned goods. Thus, we observe that there was no basis for rejection of the declared value by the Department. 10.2 We observe that the value of Patchouli Oil depends on various parameters such as alcohol content, specific gravity and Refractive Index of the Patchouli Oil. The appellant submits that the alcohol content in the Patchouli Oil varies from 32% to 2%. However, the investigation has not brought in any evidence to show that the contemporaneous import price whose price had been relied upon in this case to demand differential duty, has the same alcohol content, specific gravity and refractive index as that of the goods imported by the appellant. Accordingly, we hold that rejection of the declared price by the appellant is legally not sustainable. 10.3. We observe that the appellant submitted letter dated 12.12.2005 wherein the importer clarified that the value declared by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng any evidence to the effect that the goods are comparable. There is no evidence available on record to indicate that the Patchouli Oil imported by the appellant and the contemporaneous imports whose price has been adopted by the Department are similar in all respects. Accordingly, we hold that the demand of differential duty along with interest confirmed in the impugned order is not sustainable and accordingly, we set aside the same. Since, the demand of duty is not sustainable, the question of imposing penalty on the appellant importer does not arise. 11. With regard to imposition of personal penalty on Shri Subhas K Naik, the appellant submits that imposition of huge penalty of Rs. 25,00,000/- is not warranted in the matter in as much as there is neither any contumacious conduct or deliberate violation of statute in order to enable the department to invoke penal provisions. We observe that there is no finding in the impugned order regarding the role played by the appellant in the alleged under valuation. It has been alleged that Shri Subhash Khandubhai Naik has visited the supplier and fixed the price over telephone and accordingly, the lower price was fixed due to his persona ..... X X X X Extracts X X X X X X X X Extracts X X X X
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