REINKERS Vs. COMMISSIONER OF CUSTOMS, AHMEDABAD

JUDGEMENT

(1.) AS per the facts on record, M/s. Reinkers, Ahmedabad had imported 3 types of inked ribbon rolls totally valued at US$ 5500 CIF as per invoice and sought clearance under Bill of Entry No. 36/95 dt. 2 -2 -95. The invoice produced by them was in respect of 3 types of ribbon rolls i.e. 48000 pcs. of EM 200B, 5000 pcs. of B 200B and 1000 pcs. of EW 300M type for which the CIF value declared were US$ 0.10, US$ 0.12, US$ 0.15 per roll respectively. The invoice was issued by one Exim Enterprises in favour of the importer. The physical examination of the goods were ordered before assessment and on physical examination one envelope was found in one of the 20 crates containing an invoice issued by M/s. Ribbon Technology Corporation, manufacturer of the ribbons issued in favour of M/s. Exim Corporation, the supplier for delivery to M/s. Reinkers, the present importer along with a packing list which gave details of the shipping address which was that of the importer at Ahmedabad and the suppliers address along with a purchase order No. 081694 placed by the customer. This invoice carried the same number, i.e. 4344 which was presented by the importer while filing the Bill of Entry. However, this invoice was in respect of only one variety, i.e. EM 200 pancakes having a size of 5/16 1385 100 mm large 20 crates/ 5 cases (480) each. The unit price declared in this invoice was US$ 0.41 per roll as against US$ 0.10 declared by the importer. The number of rolls indicated was 40,800 which appeared to be typographical error because the invoice was for 20 crates having 5 cases each and each case contained 480 rolls and accordingly the number of rolls would be 48,000. In view of this invoice, assessments were initially made provisional pending inquiries from other Custom Houses etc. and the clearance was allowed after obtaining a bond and bank guarantee from the importers.

(2.) DURING investigations, it came to light that the same importer had earlier imported another consignment of 50,400 pcs. of EM 200B type rolls at the same price of US$ 0.10 per roll from the same supplier and had cleared the same vide Bill of Entry 129/94 dt. 19 -7 -94 from CFS Adalaj.

(3.) SINCE the second invoice found in the packing was issued by the manufacturer in favour of the same importer for the same kind of EM 200B pancakes of same size, it genuinely appeared that the value declared by the importer in both the Bills of Entry was incorrect and mis -declared and accordingly a SCN was issued to the importer asking them to show cause as to why the value of rolls of EM 200B type should not be enhanced from US$ 0.10 to US$ 0.41 per roll. Since the quantity of the other 2 rolls was very small and since they appeared to be of better quality because the value declared was more than the EM 200 variety, the SCN also proposed to enhance the value of the other 2 varieties also at the rate of US$ 0.41 per roll. The SCN also demanded duty amounting to Rs. 6,24,220/ - in respect of 50,400 pcs. of EM 200B type rolls already cleared vide Bill of Entry No. 129/94 dt. 19 -7 -94 and further asked the importer as to why duty amounting to Rs. 6,64,129/ - should not be recovered by enforcing the bank guarantee submitted by the importer in respect of the present consignment imported vide Bill of Entry No. 36/95 dt. 2 -2 -95 and also as to why both the consignments should not be confiscated under Section 111(m) of the Customs Act, 1962 for mis -declaration of value and why penalty should not be imposed on the importer under Section 112(a) of the Customs Act, 1962.