TMI Blog1990 (8) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... against the common order made by the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi dated 31-10-1988 in C.A. Nos. 808 to 810/87-A. 2. Brief facts of the case are that M/s. Sharp Business Machines (Pvt.) Ltd., Bangalore (hereinafter referred to as the company) is a small scale unit duly registered as such since 1984. The company had started the phased manufacture of plain paper copiers and obtained a licence in this regard dated 25-11-1986 for ₹ 4,94,500/- from the licensing authority. The company imported components and consumables in SKD/CKD for plain paper copiers. Three consignments were imported from M/s. Paralax Industrial Corp., Hongkong under airways bill numbers 098, 4960, 3120; 098, 4960, 3116; and 098, 4960,3105 all dated 21-1-1987. The goods were received at the air cargo complex, Bangalore. The company sought the clearance of the imported goods under bills of entry Nos. 2044, 2045 and 2046 all dated 3-2-1987. Similarly, the goods were also imported from M/s. Alpha Papyrus Trading Co. Pvt. Ltd., Singapore under airway bill No. 098, 4925, 4914 dated 19-2-1987. The clearance for this consignment was sought under bill of entry No. 4993 dated 11-3- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was a misdeclaration that the imported goods were only parts of the copiers. The Collector also held that description of most of the items in the invoices had been deliberately manipulated to suit the description in the licence. The goods covered by three bills 2044, 2045 and 2046 were held to be one consignment and one AWB and thus viewed as one consignment, it amounted to the import of ten copiers. The goods imported under the 4th bill No. 4993 were four fully finished copiers in SKD/CKD form. The Collector further held that in terms of note (i) to Imports Control Order, 1955 and Customs Tariff Act, 1975, these goods will be deemed to be fully assembled copiers for the purpose of valuation and licence. Thus the goods imported as fully assembled copiers were not permissible to be imported and this was a clear violation of the Act and the terms of the licence. It was also held in the alternative that even if all the parts imported were viewed individually, none of the items tally with the licence. The Collector in this regard gave detailed reasons for arriving at this conclusion. The Collector also held that the value of the parts imported for the purposes of Sec. 14(1) of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... As regards the question of imposing fine and penalty also the Tribunal found the order of the Collector as correct, and did not find any cogent reason to interfere in the order of the Collector. 7. We have heard Mr. Dholakia for the appellants and Mr. Kapil Sibbal learned Addl. Solicitor General for the respondents. 8. It was argued by Mr. Dholakia that the Tribunal committed a serious error in holding that the invoices submitted by the company were undervalued and could not be relied upon for determining the correct value of the goods imported. It was contended that the Collector Customs was not correct in determining the value of the imported goods on the basis of the quotations of M/s. Shun Hing Technology Ltd., Hongkong. The quotation of Shun Hing indicated prices at Hongkong and not the place of importation. There was no other material on record to determine the value of the imported goods. It was thus contended that in the absence of any other relevant material, the invoice price has to be taken as the basis for valuation. It was also submitted that there was no justification in discarding the price shown in the invoices which contained the correct value of the goods im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the goods contained in the cartons comprised of all the parts required for full and complete assembly of copiers. At the time of examination of the goods covered by Bill of Entry No. 4993 dated 11-3-1987, it was found that out of the six cartons, four cartons were the original cartons used for packing fully finished/assembled copiers Model FP 2625. The description, model number, brand, manufacturer and country of origin/manufacture of the copier (viz. Plain Paper Copier FP 2625 Panasonic, Matushita Electric Co. Ltd. and Japan respectively) were clearly marked on these four cartons, one set of cassettes, trays, covers, one drum, one developer unit and a bottle of developer. It was thus argued that the original packing cartons used for packing fully finished copiers are normally supplied only if fully finished copiers are purchased. It was submitted that the adjudicating authority has given detailed reasons for showing that the goods imported were not components of plain paper copiers as declared. In fact, the company had purchased 14 fully finished copiers 10 in Hongkong and 4 in Singapore and had then dismantled for importing the same in the guise of components of copiers. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vided that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented under Section 46, or a shipping bill or bill of export, as the case may be, is presented under Sec. 50. According to the above provision the value of the goods shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation, in the course of international trade where the seller and the buyer have no interest in the business 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 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and consumables. The licence produced is valid for certain components and is not valid for fully assembled copiers. The fully assembled copiers are the end products of the importers and hence cannot be imported by them. Plain Paper Copiers are electronic equipments. 14. The case Union of India v. Tara Chand Gupta Bros. (supra) lends no assistance to the appellants in the facts and circumstances of the present case. In the above case Tara Chand Bros. held an import licence dated July 10,1956 permitting them to import parts and accessories of motorcycles and scooters as per Appendix XXVI of the Import Policy Book for July-December, 1956. Under the said licence, the respondents in that case imported certain goods which arrived in two consignments, each containing 17 cases by two different ships. According to the respondents, the goods so imported by them were motorcycle parts which their licence authorised them to import. The Customs authorities, on the contrary held, on the examination of the goods, that they constituted 51 sets of Rixe Mopeds complete in a knocked down condition . After holding an inquiry the Deputy Collector directed confiscation of the said goods with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld as under : Under entry 295, except for rubber tyres and tubes for whose import a separate licence could be obtained under entry 41 of Part V, there are no limitations as to the number or kind of parts or accessories which can be imported under a licence obtained in respect of the goods covered thereunder. Prima facie, an importer could import all the parts and accessories of motor cycles and scooters and it would not be a ground to say that he has committed breach of entry 295 or the licence in respect of the goods described therein, that the parts and accessories imported, if assembled, would make motor cycles and scooters in C.K.D. condition. There are no remarks against entry 295, as there are against entry 294, that a licence in respect of goods covered by entry 295 would not be valid for import of spares and accessories which, if assembled, would make motor cycles and scooters in C.K.D. condition. Apart from that, the goods in question did not admittedly contain tyres, tubes and saddles, so that it was impossible to say that they constituted motor cycles and scooters in C.K.D. condition. The first two could not be imported and were in fact not imported b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Collector to say that had the importer desired it was possible for him to assemble all the parts and make motor cycles and scooters in C.K.D. condition. Surely, such a meaning has not to be given to entry 295 unless there is in it or in the licence a condition that a licensee is not to import parts in such a fashion that his consignments, different though they may be, when put together would make motor cycles and scooters in C.K.D. condition. Such a condition was advisedly not placed in entry 295 but was put in entry 294 only. The reason was that import of both motor cycles and scooters as also parts and accessories thereof was permitted, of the first under entry 294 and of the other under entry 295. A trader having a licence in respect of goods covered by entry 294 could import assembled motor cycles and scooters, but not those vehicles in C.K.D. condition, unless he was a manufacturer and had obtained a separate licence therefor from the Controller of Imports who, as aforesaid, was authorised to issue such a licence on an ad hoc basis. Thus the restriction not to import motor cycles and scooters in C.K.D. condition was against an importer holding a licence in respect of goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de up the completed article because of the lack of certain essential parts which admittedly were not available in India and. could not be imported. The real distinction, however, between the two cases was that the decision of the Collector in D.P. Anand's case was not, as was the decision in Girdhari Lal's case under which of the two competing entries the imported goods fell but that the imported goods in question, if assembled together, would not be the goods covered by the entry, and therefore, not the goods in respect of which the licence was granted. Further, the articles in question, even when assembled together, were not prohibited articles as in Girdharilal's case. Girdharilal case is clearly distinguishable because it is not as if motor cycles and scooters are prohibited articles as was the case there. The restriction is not against licensees importing motor cycles and scooters under entry 294 and parts and accessories under entry 295 but against the licensees under entry 294 importing motor cycles and scooters in C.K.D. condition. The question in the instant case was not under which of the two entries, 294 or 295, the goods fell, but whether the goods were part ..... X X X X Extracts X X X X X X X X Extracts X X X X
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