TAITO WATCH MANUFACTURING INDS. Vs. COMMISSIONER OF CUS.

JUDGEMENT

(1.) In these three appeals, arising out of a common Order -in -Original Nos. 5 to 9/2002, dated 7 -6 -2002 passed by the Commissioner of Customs, the issue involved relates to the enhancement of the value of the goods imported by the Appellants.

(2.) Shri C. Harishankar, learned Advocate, mentioned that all the three Appellants, namely M/s. Taito Watch Manufacturing Industries, Appellant No. 1, M/s. Rochi Ram and Sons, Appellant No. 3 and M/s. Rajasthan Watch Manufacturers, Appellant No. 2 imported watch cases, watch dials, leather straps, winding knobs and watch hands from M/s. Legend Watch Manufacturers Ltd. (LWM in short), Hongkong; that they filed five Bills of Entry in which the value was declared as per the invoices received from the foreign suppliers; that the goods imported by the Appellant Nos. 1 and 2 were assessed to duty on the basis of the invoice price declared and the imported goods were permitted to be cleared on payment of duty; that the goods imported by the Appellants No. 3 were seized and released on execution of Bond and furnishing of bank guarantee; that subsequently show cause notices dated 4 -5 -2001 were issued alleging under valuation of the imported goods on the ground that the Revenue had obtained from Hong Kong Customs a copy of the Export Declaration lodged by LWM before the Hong Kong Customs Department in respect of the impugned goods and the value declared by the Appellants was grossly at variance with that declared in the said Export Declaration; that the Commissioner under the impugned order has confirmed the demand of Customs duty and imposed penalties on all the three Appellants, besides confiscating the goods imported by the Appellants and imposed redemption fine, holding that the importers' name, Airway Bill Nos., Invoice Nos. and description of goods as entered in the Export Declarations matched with the invoices filed by the Appellants with Bills of Entry which indicated their intention to evade payment of duty.

(3.) The learned Advocate submitted that the assessable value of the impugned goods had been enhanced on the basis of price shown in the Export Declaration allegedly filed by M/s. LWM before the Hong Kong Customs Authorities; that there is no allegation contained in the show cause notice nor is there any finding in the impugned order that the Appellants had any collusion with the suppliers of the goods abroad; that only allegation mentioned in the show cause notice that the Appellants had willfully misstated and suppressed the actual values of the imported goods in the invoices and Bills of Entry; that they had declared the prices as mentioned in the invoices and there being no allegation/finding about collusion between the Appellants and the supplier of the impugned goods, extended period of limitation for demanding duty under Section 28 of the Customs Act cannot be invoked in respect of Bills of Entry at serial Nos. 2 to 5 in the Chart given in Para 1 of the impugned order, [that is Bills of Entry Nos. 37, dated 10 -4 -1997, 634, dated 17 -5 -96, 38, dated 10 -4 -1997 and 6461, dated 20 -5 -1996]. The learned Counsel, further, submitted that none of the situations envisaged in Rule 4(2) of the Customs Valuation Rules, exist and, therefore, the declared transaction value cannot be rejected; that the law on this subject is settled, most definitively, by the judgment of the Supreme Court in the case of Ei -cher Tractors Ltd. v. Commissioner of Customs, 2000 (122) E.L.T. 321 (S.C.) wherein it has been unequivocally laid down that Rules 3(1) and 4(1) of the Valuation Rules mandate acceptance of the invoice value as the transaction value and only after the transaction value is rejected as per the special circumstances contemplated in Rule 4(2), the assessing or adjudicating authority can proceed to resort to alternate methods of valuation; that the Supreme Court in Mirah Exports Pvt. Ltd. v. C.C., 1998 (98) E.L.T. 3 (S.C.) has held that in absence of mutuality of interest or special price being given the invoice price had to be accepted. He thus contended that as none of the ingredients mentioned in Rule 4(2) of the Valuation Rule exists in the present matters, transaction value has to be accepted by the Revenue; that even if it were to be assumed that LWM declared a different price in the Export Declaration, that would not constitute a ground to reject the invoice price declared by the Appellants, as it is not one of the considerations enumerated in Rule 4(2) of the Valuation Rules.