METHODEX SYSTEMS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) IN this appeal at the instance of the importer the issue raised is whether the Customs authorities were justified in enhancing the assessable value of currency counting machine imported by the appellant.

(2.) THE appellant as part of its trading business imported currency counting machine (hereinafter referred to as CCM) from two overseas suppliers, namely, M/s. Herny Yung of Taiwan and M/s. Jaewoo Corporation of South Korea. These machines are of two models, namely, Floor Model and Desk Top Model. Initially the appellant imported CCM from M/s. Herny Yung @ USD 900 from April, 2000 to September, 2000. For the period October 2000 till March 2001 the price was reduced to US 850 in view of the increase in the volume of import. Since M/s. Henry Yung was not able to supply entire requirement of the appellant, the appellant imported 42 number of CCM from M/s. Jaewoo Corporation at a unit price of 920 US under Bill of Entry dated 26 -2 -2001. Since the price quoted by M/s, Jaewoo Corporation was very high the appellant reverted to M/s. Henry Yung. Under invoice dated 18 -7 -2001 100 numbers of Floor Model of CCM was purchased @ 830 US and 10 numbers Desk Top Model of CCM at the same rate.

(3.) IN the meanwhile the appellant took up negotiations with M/s. Jaewoo Corporation for reducing the price of CCM. The learned counsel for the appellant took us through the correspondence between the parties starting from letter dated 15 -5 -2001 onwards. By letter dated 3 -7 -2001 M/s. Jaewoo Corporation informed the appellant that they are ready to offer DHP -IF Model at US 790 and DHP -ID Model at US 750 subject to the condition that order will be placed for minimum of 100 machines, that the payment would have to be made through an irrecovable letter of credit and that the freight and insurance charges would have to be borne by the appellant. To this offer the appellant replied placing an order for 150 machines (75 Nos. of each type). They also made a request to bring down the price of DHP -IF to 750 US . Machines thus ordered were covered by invoice dated 14 -9 -2001 and were imported vide Bill of Entry No. 804 dated 17 -9 -2001.