KAMANI OIL INDUSTRIES Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners imported "Copra" of Zanzibar origin under a valid import licence. The shipment was invoiced by M/s. Panachand & Co. Pvt. Ltd., Singapore, under their Invoice No. 451 of 15th July, 1980. The Assistant Collector of Customs thought that the goods had been under-invoiced and, therefore, a show cause notice was issued on 23rd January, 1981. The petitioners sought to explain to the Assistant Collector of Customs stating that they had imported the goods as per the conditions contained in the import licence and on a price as agreed between themselves and the said sellers M/s. Panachand & Co. and that they had paid the Sellers only the Invoice value as per the contract and nothing more and therefore, there was no question of any under invoicing. It was pointed out that the petitioners had no interest whatever in the Sellers and the price was the sole consideration for the transaction. However, the Department proceeded totally on a wrong basis. It appears that the origin of the supply was from Zanzibar State Trading Corporation, Zanzibar. The Department said that in the International trade at the material time, there were fluctuation in the prices and, therefore, the goods could not have been imported at the price shown in the invoice and according to them the petitioners were liable to pay an additional duty amounting to Rs. 43,792.13P.

(2.) As against the decision given by the Assistant Collector of Customs, the petitioners filed this petition, sometime in October 1981.

(3.) It appears that in the meanwhile another Oil Company viz. Liberty Oil Mills had imported from the same source the same goods and the Department had proceeded against the said Company more or less on the same basis and contended that the invoice had been under invoiced. As against the decision by the Assistant Collector of Customs, the said Liberty Oil Mills filed an appeal before the Appellate Collector. Finally, the matter came up before the Central Board of Excise and Customs. The Board by its order dated 31st December, 1981, copy of which is annexed as Exhibit 1 to the affidavit of a partner of the petitioners dated 14th February, 1986, negatived the contention of the Department and held that there was no question of under invoicing and that the price which was required to be taken for the purpose of valuation under the Customs Tariff Act was the price at which the Sellers had offered the goods for sale and accordingly the decision of the Department was reversed. Mr. Gursahani appearing for the petitioners pointed out that now that the Central Board of Excise and Customs has upheld the contentions of the petitioners, the same line of reasoning should be accepted and this petition should be allowed.