UTTAM IMPEX Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) The appellant, M/s. Uttam Impex imported a consignment of Zeera Kajak weighing 9150 kgs at Mumbai and filed Bill of Entry No. 28883476 dated 5.8.2002 for assessment and clearance of the goods. The value declared was @ US 1 per kg. In the light of the investigation carried out by Directorate of Revenue Intelligence Officers at Mumbai regarding value of imported Zeera Kajak from Afganistan, order in adjudication dated 10.1.2003 was passed by the Additional Commissioner of Customs (Import), Mumbai holding that the importer had mis -declared the value of the imported goods with a view to evading customs duty and, therefore, the consignment was liable to confiscation under Section 111(m) of the Customs Act, The order enhanced the value to US 2 per kg. in terms of Rule 5 of the Customs Valuation Rules, 1988. The consignment was confiscated under Section 111(m). However, an option to redeem was given upon payment of a fine of Rs. 2 lakhs. Further, a penalty of Rs. 40,000 was also imposed on the appellant under Section 112(a) of the Customs Act. The appellant contested that order before the Commissioner of Customs (Appeals), Mumbai -I. That appeal failed. Hence, the present appeal.

(2.) The contention of the appellant is that the value @ of US 1 per kg. declared by them was the true transaction value and that the goods should have been assessed to customs duty on the basis of that value and that doubling of the value based on the investigations of the DRI in the case of some other parties was not justified. In support of their contention that their transaction value represented the normal price of the goods, the appellant also pointed out that similar consignments were being assessed at around the same value at Mumbai and Amritsar Customs. The learned Counsel for the appellant has pointed out that while the appellant's Bill of Entry was dated 5.8.2002 just about two weeks prior to that Bill of Entry another consignment of Zeera Kajak had been assessed at Mumbai Customs House under Bill of Entry No. 27999451 dated 22.7.2002 accepting the assessable value of US 1 per kg. He also pointed out that this consignment was also of Afghanistan origin and was almost identical quantity of over 9 MTs. The learned Counsel also referred to several assessments at Amritsar around the price of US 1 per kg. It is also the appellant's contention that viewed from the domestic sale price of Zeera Kajak, an import price of US 2 is not commercially viable. In this context, he referred to several invoices for Zeera from domestic dealers viz. Sunil Kumar and Bros., Sudhir Trading Company, Delhi and Ratan Lal Sunil Kumar, Delhi and pointed out that the wholesale price of Zeera was in the range of Rs. 70 to 80 per kg. The Counsel also referred to Spice India Report of March 2003 indicating the average price of cumin at Mumbai around Rs. 80 to 81 per kg. The appellant also pointed out that the disposal price of seized Zeera Kajakby Mumbai Port Trust in April 2003 through auction also would show that the sale price in auction was around Rs. 72 per kg. (letter dated 9.4.2003 of Assistant Manager, Sales, Mumbai Port to Deputy Commissioner of Customs, Group I, New Customs House, Ballard Estate in relation to auction on 5.2.2003). With regard to the DRI investigation, the submission 01 the appellant is that two importers in October 2002 appeared to have agreed to the enhancement of assessable value to US 2 per kg and such admission is applicable only to their cases and is no ground for rejecting the transaction value declared by the appellant importer.

(3.) Learned SDR has made available a copy of the letter dated 22.10.2002 from Joint Director, DRI to Additional Commissioner of Customs, Mumbai on the valuation of Zeera Kajak. This letter states that M/s. Wala Overseas P. Ltd., Mumbai have confessed to have under -invoiced the goods at US 1100 per MT. and are ready to pay duty on the actual contracted price of US 2000 per MT. The letter also states that in a similar case, M/s. Regency Trading Company have suo moto given in writing that they had misrdeclared value of Zeera Kajak at US 1000 per MT of Afghanistan origin when the actual purchase value of the said goods was US 2000 per MT and are ready to pay the duty on the enhanced value. The letter requested for adjudication of the present appellant's case on the basis of the enhanced value. The SDR has also made available a print out for the period 1.1.03 to 28.4.03 which shows that there was no import of Zeera Kajak during that period at Mumbai.