COMMISSIONER OF CUSTOMS, KANDLA Vs. MICRO INKS

JUDGEMENT

(1.) We heard Shri S.K. Mall, learned SDR appearing on behalf of the appellant and Shri S. Suriyanarayanan, learned advocate appearing on behalf of the respondent.

(2.) THE facts in brief are that M/s. Hindustan Inks and Resins, Vapi, Gujarat (hereinafter called the respondent) imported 51.089 MT of Methyl Isobutyl Ketone (MIBK or the goods) from South Africa and filed Bill of Entry No. 8067 dt. 14 -6 -02 by declaring the price as USD 690 PMT. During the same period, another importer M/s. Crescent International had imported the 70 MT of the same commodity at a price of USD 755 PMT vide Bill of Entry No. 8068 dt. 14 -6 -02. The respondent was asked to justify their price under Rule 10A of the Customs Valuation Rules, 1988 (hereinafter called the Rules) by a query memo. In reply, the respondent stated that they are manufacturers of Ink and import the said MIBK directly from the manufacture on a half yearly contract at USD 700 PMT (690 + 10 as interest for late payment, if any). Not satisfied with the reply, the department issued a Show Cause Notice calling the respondent to show cause as to why the declared price should not be rejected under Rule 10A of the Rules and why the value should not be enhanced to USD 755 PMT. The respondent, in their reply to the SCN, stated that they had entered into a contract with the supplier -manufacturer in the month of April, 2002 for supply of the goods from April to July, 2002. The prices of the goods increased to USD 755 PMT during this period but they continued to receive the goods at the same price of USD 690 PMT. The first lot of 100 MT was imported in April -May, 2002 at the same price and the same was cleared by the Customs House.

(3.) AFTER going through the submissions, the adjudicating authority vide his impugned OIO observed that the import in the instant case was based on the half yearly contract No. COPL/MIBK/SASOL/108/2002(1), dt. 5 -4 -02. The supplier is also the manufacturer and the importer is also an established manufacturer. He also relied on the Chemical Trade Intelligence Bulletin for June, 2002 which indicated the price of MIBK of South Africa origin @ USD 818.11 PMT if packed in drums and an abatement of 15% if supplied in Bulk. This was at par with the declared price by the respondent.