1. Heard Shri A.K. Saxena, learned J.D.R. for the Department. None appeared for the respondents. We find that the impugned order passed by the Adjudicating Commissioner of Customs has been challenged on the basis of a Review Order passed by the Board on the following grounds:- "1. The Commissioner by applying the ratio of the judgment in case of Jopson v. James, Doleman v. Osset Corporation, referred to in the case of AIR 1954 Patna 262 of Sree Bhabapritananda Ojha, has held that when proper officers of Bombay Custom House were seized of the mater with the filing of the B/E and assessment thereof, the jurisdiction of DRI was deemed to be barred, who are having concurrent jurisdiction over the same subject. For convenience sake, relevant extract of the order of the High Court of Patna is set out herein below.
"(6) In my opinion the argument of Mr. P.R. Das is correct. If the statute is construed in its plain and grammatical sense there would be conflicting orders between two jurisdictions. Complications and difficulties would arise if the two authorities hold conflicting views as to proper way of dealing the trust properties. The petitioner cannot serve two masters at the same time and if there are conflicting orders the petitioner would be placed in an impossible situation. These results are so startling that I must reject the interpretation which leads to them. In a case of this description the rule of construction is well settled. It is a matter of great public importance that there should be as far as possible no conflict or clash of jurisdiction between two equally competent authorities. The principle at stake is the principle of comity,".
The ratio of judgments relied upon by the Commissioner are not applicable to the facts of the subject case, as the DRI cannot be considered as an authority having concurrent jurisdiction over the subject case in so far as quasi judicial powers are concerned. In terms of Notification 19/90 Cus (NT) dated 26.4.90, Astt. Director, DRI is also Asstt. Commissioner of Customs. Therefore, Asstt.
Director, DRI is having powers to seize the goods, investigate into offences committed and issue a SCN answerable to appropriate quasi judicial authority. In the aforesaid case laws referred by the Commissioner, there was a possibility of arising of conflicting views as Bihar High Court and High Court of Calcutta were having concurrent jurisdiction over the said matter and High court of Calcutta had already passed an order. Therefore, there was a possibility of conflicting orders if the two courts held conflicting views on the same subject matter. In the instant case, there is no such possibility as DRI is not vested with quasi judicial powers. In a related case law, UOI v. Sigma Electronics 1996 (87) ELT 26 (Cal), The Hon'ble Division Bench of Calcutta High Court has recently interalia held that the assessment made by Dy. Commissioner of Customs being Provisional assessment, the DRI is having authority to make further enquiry for assessing the duty thereon. The Commissioner, therefore, has grossly erred in holding that the seizure and the SCN issued by DRI were ab-initio void and thereby proceeded on premises, which are not legally sustainable.
2. Para 47 of the EXIM Policy 1992-97, as it was applicable to the subject goods, provided that under the Duty Exemption Scheme, the import of raw materials intermediaries, components, consumables, parts, accessories, packing materials and computer software required for direct use in the product to be exported may be allowed to be imported duty free. The Customs notfn. No. 203/92-Cus provides that the materials covered by a Value Based Advance Licence can be imported duty free. In the explanation to the said notfn. the "material" has been defined to mean as raw materials etc., required for manufacture of export product. Therefore, the Policy as well as the Customs notfn. prescribe some nexus between the goods which are to be imported and the goods which are to be exported.
As per the judgment of CEGAT, WRB, vide order No. 2491-95 dated 16.1.96 in case of M/s. Chemical De Universe Ltd. and also of the Bombay High Court in S.V.A. Udyog Viniyog v. UOI 1993 (46) ELT 376 Bom, nexus between the raw material imported and the export product has to be established. It has been further laid down in the decision of the CEGAT vide order No. 2910-2961/WRB dated 25.9.1996 in case of M/s Garment Craft that if the exported goods did not contain the kind of fabric which has been imported, the goods imported cannot be construed to be for replenishment. Therefore, the view held by the Commissioner that what is permissible to be imported under transferred advance licence are the goods which are mentioned therein and not the same goods which were used in the goods exported is not legally sustainable and is without any authority.
3. Out of the six fax messages relied upon in the SCN the two fax messages dated 24.1.95 and one fax message dated 7.2.95 are very much relevant to the subject import. The fax messages dated 24.1.95, read with the statement dated 9.2.95 of Shri Ramesh Nebhnani, clearly establishes that atleast 2 of the 5 consignments covered by invoices Nos. 10/95 and 27/95 there was direct evidence of under invoicing and they further reveal that compensatory payments were made for the differential amount between the invoice price and actual price through a credit US dollars account maintained by the importers with the foreign supplier. The statement of Shri Ramesh Nebhmani are corroborated by these two fax messages dated 24.1.95 as documentary evidence. It is a settled law that if the statement is retracted such circumstances, the independent documentary evidence do not lack their evidentiary value. Therefore, these two fax messages read with the statement of the partner of the importing firm are admissible as evidence. The argument that these are planted is totally baseless and unsubstantiated. In any case, such argument does not take away its evidentiary value as they are true. The corroborative evidence in the form of fax messages dated 24.1.95 renders the statement of the parties more correct and authentic.
4. From the six fax messages recovered, statements tendered by the partners of the importing firm and the invoices produced for clearance it is clearly evident that the value of Fur fabrics were varying from USD 3.57 to USD 4.80 per yard depending upon print, length of pile and weight per yard. In regard to invoice Nos. 10/95 and 27/95 the actual unit price was USD 4 per yard and USD 4.15 per yard respectively against the declared price of USD 1.5 per yard. In respect of balance (3) consignments covered by invoice Nos. 488/94, 500/94 & 513/94, where the declared price shown as USD 1.5 per yard, there was no direct evidence of under invoicing. However, as since the goods covered by these invoices were similar to those (2) invoices referred to above, the value of these goods should also have been determined on the basis of price quoted in fax messages for different grades/colour/pile length/print of the fur fabrics.
The Commissioner, therefore, has erred in rejecting the proposed enhanced prices without considering the reliability of evidence in total.
5. The Commissioner ought to have considered that the seized fax dated 9.2.95 from Puerto Rico detailed the prices of different specification of Artificial Fur Fabrics and these prices varied from US$ 4.65 to US$ 6.68 per yard, depending upon their quality, print and length of pile fibre for Artificial Fur fabrics. The Commissioner, therefore, ought not to have accepted the uniform price of US$ 1.5 per yard declared irrespective of the length of the pile fibre.
6. The Commissioner, without assigning any reason, ought not to have concluded that the fax messages dated 24.1.95 had been planted with an intention to implicate the importer-noticee and that this message had been received in their office only on 8.2.95. The Commissioner ought not to have concluded that the fax dated 24.1.95 has no connection with the present importers simply because the importers had produced a copy of a fax from the overseas supplier with certain variations therein. The contents of the fax messages relating to invoice numbers in the lower half are connectable to the importer herein.
7. The Commissioner erred in holding that the additions in the page 8 and 9 of the statements dated 9th and 10th Feb. 1995 of the party Shri Ramesh Nebhnani were forged additions and were in collusion with the statements and they are of involuntary nature. He ought not have rejected the statements without considering the statement of Shri Anil Nebhnani (which has not been retracted), which correspondingly supported the material facts of the statements of Shri Ramesh Nebhnani. Moreover, the additions in the statement of Shri Ramesh Nebhnani are in the handwriting of Shri Ramesh Nebhnani himself and bear his signature. As seen from the said statement of Shri Ramesh Nebhnani so called additions are in the nature of grammatical correction and do not materially alter or change the meaning of the sentences.
8. The Commissioner ought to have considered the contents of the various fax messages seized during the search on 9.2.95 and ought to have read the price structure for Artificial Fur fabrics which was discussed from time to time and they were materially corroborating each other, including the reply prepared in his own handwriting by Shri Anil Nebhnani, brother of Ramesh Nebhnani.
9. The declared value for the impugned goods in this case had been proposed to he enhanced interalia on the basis of documentary evidences in the form of fax messages supported by statements recorded Under Section 108 of the Customs Act showing actual transaction value and not on the basis of contemporaneous imports at higher value. The Commissioner has further failed to bring out in his order as to who has planted the relied upon fax messages. Even if the fax messages were transmitted from M/s. Mahaveer Communications, these are genuine documents from their Taiwanese supplier M/s. Puerto Rico Investments Ltd. There is no proper and conclusive evidence whatsoever to show that they were planted.
Calling an evidence produced by the department as planted without any proof and without identifying the person who planted it is total error on part of the adjudicating authority and is not acceptable at all. Similarly, calling the additions in the statements of a partner, in the handwriting of that person himself, as forged additions, without any proof and without identifying who forged it, is also a gross error on part of the adjudicating authority. He appears to have accepted just what the importers submitted in their defence in this regard without proper application of mind and without really looking into such allegations against the DRI official.
10. The Commissioner ought to have considered that apart from the seized fax messages, there were also two crucial documents including a fax message, which were recovered in torn condition and re-assembled during panchanama. One of the fax messages-originated from M/s Puerto Rico Investments Ltd. bearing date 7-2-95 and another a reply in the hand-writing of Shri Anil Nebhnani on the letter of M/s Nebco Traders dated 8.2.95. Further, the fax message dated 9.2.95 could not have been faxed from Mahavir Communication on 8.2.95." 2. After hearing the learned D.R. and perusal of case records, we find substance in the submissions made on behalf of the department.
Accordingly, we set aside the impugned order and remand the case for fresh adjudication by the successor Commissioner after hearing both sides. The appeal is allowed by way of remand.