PAB (I) PVT. LTD. Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) The issue involved in this Appeal filed by M/s. PAB (I) Pvt. Ltd. relates to enhancement of the assessable value of the goods imported by them under the Customs Act.

(2.) Shri L.P. Asthana, learned Advocate, submitted that Appellants imported goods under Bill of entry dated 26.12.2000 describing the goods as Copper clad laminates (1) side cut, off cuts and rejected, and (2) grade 'C' sheets; that the value declared by them was 0.4 US per kg. in respect of side cuts, off cuts and rejects and 0.75 US per kg. in respect of grade 'C' sheets, that the Commissioner under Order -in -Original No. 48/2001 dated 6.11.2001 had held that the grade 'C' sheets were actually virgin prime sheets and that similarly side cuts etc. were actually strips cut from virgin sheets of copper clad laminates; that the Commissioner determined the value of the sheets to be US 95.75 per sheet and that of strips US 750 per MT; that on Appeal filed by them, the Tribunal vide Final Order No. 373/2002 A dated 14.8.2002 has held that the Commissioner's order "rejecting the declared value for imported goods misdeclared as 'C' grade and rejects cannot be questioned. However, there is force in the contention of the Advocate for the Appellants that the goods imported by them requires to be inspected in their presence to ascertain the thickness of the sheets which are less than thickness of sheets usually imported." The Tribunal, therefore, remanded the matter for determination of value of the imported goods after allowing inspection of the goods in question in the presence of the appellants and after disclosing the basis of valuation and after hearing the appeals on the issue of valuation. The adjudicating officer may also redetermine fine and penalty imposed on the basis of fresh determination of value. The learned Advocate, further, mentioned that under the impugned order the Commissioner has determined the assessable value at US 9.75 per sheet and US 750 per MT in respect of off cuts/strips; that the Commissioner has also imposed a penalty of Rs. 5 lakhs under Section 112 of the Customs Act and confiscated 2000 sheets of copper clad laminates and strips with an option to redeem the same on payment of fine of Rs. 4.5 lakhs.

(3.) That the Commissioner has not proceeded in accordance with the Customs Valuation (Determination of Price of Imported Goods) Rules, 1965; that the Commissioner has determined the assessable value on the basis of data called from ICD, Tuglakabad, New Delhi; that as per the information received from ICD, Tuglakabad, Copper clad laminates had been imported at US 5.9 and 9.75 per sheet; that the Commissioner under the impugned order had adopted the highest price i.e. US 9.75 which is against the provisions of the Customs Valuation Rules; that even Rule 5(3) of the Customs Valuation Rules clearly provides that if more than one transactional value of identical goods is found, the lowest of such value shall be used to determine the value of the imported goods; that similarly Rule 8(2)(ii) provides that no value shall be determined under Rule 8 on the basis of a system which provides for the acceptance for Customs purposes of the highest of the two alternative values; that accordingly the highest value reported by ICD Tuglakabad cannot be accepted. He also mentioned that the Chartered Engineer, who had inspected the impugned imported consignment on the instance of Customs Department, has mentioned in his Report dated 18.1.2001 the market rates as follows: Rs. 175 per kg. in respect of sheets and Rs. 58 per kg. in respect of side and off cuts; that applying the deductive method of arriving at assessable value as provided in Rule 7 of the Customs Valuation Rules, the value of imported goods would be nearer to the price declared by the Appellants in their bill of entry. He also emphasised that in respect of determination of value of side and off cuts, the Adjudicating Authority has not given any basis and the value has been enhanced arbitrarily. Finally, he submitted that the redemption fine of Rs. 4.5 lakhs is very unreasonable and excessive; that on the basis of market rates of the sheets as given by the Chartered Engineer in his Report, the margin of profit on sale will be in negative and therefore, redemption fine should not be imposed or in any case it should be very nominal; that similarly a penalty of Rs. 5 lakhs is on the very high side.