Full Judgment
2. Shri Balani, Ld. Advocate for the appellants submitted that the Collector of Customs decided the matter without adducing any evidence in support of the allegation of unaer-valuation. The Ld. advocate argued that no evidence was disclosed either in the show cause notice or in the impugned order or at the time of hearing. There was a specific request by the appellants, he pleaded, for disclosure of such evidence, he pleaded that the value declared by the appellants was genuine as borne out by the invoice. The Ld. Advocate also referred to 6 Bills of Entry filed between 29-5-1985 to 27-1-1987 in support of his arguments that similar goods were imported at approximately the same prices by either importers also. The Ld. advocate also cited judgment of the Tribunal in Walia Enterprise, Amritsar v. C.C. & C.E., Chandigarh reported in 1987 (32) ELT 774 in support of his plea that invoice value must be accepted unless proved incorrect by the Department.
3. Reiterating the Collector's order and submitting that the goods were undervalued, Shri Durghayya, Ld. JDR submitted that the appellants did not give the details of the quality of the imported moulding powder in their documents. Therefore, it was not possible for the customs to arrive at an actual estimate of the value of the goods. That is why, according to Ld. JDR, show cause notice threatened to increase the value to over $ 4800 but ultimately a much lower value was fixed though this value was higher than the one declared.
4. Referring to the Bills of Entry Filed by M/s. Prakash Industrial and Trading Company, Bangalore. Shri Durghayya pointed out that the assessment of this Bill was provisional. He also submitted that in the absence of knowledge about the quality of the imported goods, it is not possible to correlate any of the Bill of Entry relied upon by the Ld.
Advocate, with the present importation. Also, he submitted, four out of the six importations cited by the appellants did not have any nexus to the time of import. Referring to the copy of the invoice filed by the appellants (page 31 of Paper Book), which the New York Consulate General of India attested, Shri Durghayya submitted that this attestation is only on the basis of information in possession and the certification is only to the "best of knowledge and belief. Therefore this information does not establish the correct valuation of the imported goods, according to Ld. JDR.5. We have considered the arguments of both sides. As mentioned in the Tribunal's order in Walia Enterprise, Amritsar v. C.C. & C.E., Chandigarh (supra) the burden of proof in a charge of under-valuation lies squarely on the department. In the present case the Collector has recorded that the quality or grade manufacture is not known. In the absence of these particulars as pleaded by the Ld. Representative of the Department, a judgment whether the value declared is correct or not, is difficult. There has to be, to arrive at a fair decision, evidence about quality of the goods or other documents proving that the value has been under-declared. The Collector while passing the impugned order relied on : (i) Recorded price received from Madras Custom House which mentioned value of US $ 4810 per M.T.; (ii) Another price received from Madras Custom House indicating the price at US $ 3104 per M.T. for Grade B-15/012; and (iii) Invoice dated 26-11-1985 of M/s. Bayer submitted by the importers themselves at the time of personal hearing showing the price as about US $ 1455 per M.T. for Grade Cellodar B 15/000.
The Collector, unable to decide the quality of imported goods fixed the lowest of the three prices as the value for the importers' consignment.
6. The Appellants submitted that in respect of the first item, the details are not known and, therefore, no reliance can be placed on it.
In respect of the second price referred to by the Collector as also third, we note that, as submitted by the Ld. Advocate, these importations did not have any nexus to the time of import, the pinpoints having taken place much earlier. Besides they relate to specified grades. Here we do not know the grade of the goods.
Therefore, these too cannot be relied upon.
7. That leaves us with what evidence the appellants themselves produced detailed in their appeal. Assuming these, two invoices relating to CAB moulding powder, both invoices being dated 12-6-1986 are nearest to the date of importation which took place on 19-8-1986. Insofar as quality is concerned it has to be assumed that as the appellants themselves produced this evidence the quality of the present importation is the same or is comparable to the quality of moulding powder covered by these two invoices produced by the appellants. In both these cases the price was US $ 750 per M.T. CIF and in both bases the origin of the goods was USA as is the case in the present instance. Therefore, we order that the value of US $ 750 be adopted for the present importation.
8. Insofar as the penalty is concerned, we set aside the same as there is no evidence to prove that the appellants committed an offence in terms of Sections 111(m) and 112 of the Customs Act.
10. [Per: K. Prakash Anand, Member (T) ]. - I have carefully perused the above order of my learned brothers. With due respect, I am unable to agree.
11. The learned advocate submitted before us that the Collector of Customs rejected the invoice price without there being any evidence in support of the allegation of under-valuation. I regret that this argument has been accepted by my learned brothers.
12. It is well accepted that where an importer, while declaring the price, furnishes full particulars of the goods imported, then the onus for proving that the invoice price is not correct is on the department.
In this case, however one finds that appellants failed to give details of quality of the moulding powder imported by them. Can the value of the product be determined regardless of its quality? On the other hand, can it not be said that suppression of details as regards the quality of the product is motivated with the intention to declare a lower value for goods of higher quality with a view to paying lesser duty.
13. In this situation, as the Collector has observed, the department was left with no choice but to go by the available prices of the imported products. The Collector tried to be as fair as possible, and, in the absence of the particulars as regards the quality of the product, he decided to go by the lowest of the three prices available.
14. The above order says that insofar as the quality is concerned, it has to be assumed, in the circumstances, that the quality of the present importation is the same or is comparable to the quality of the.
moulding powder covered by the two invoices produced by the appellants.
It is very dangerous, indeed, to lay down a law which obsolves the assessee of his obligation fully to declare all particulars, including quality, grade and value of his goods, and, in such circumstances, requires the department to make assessments on the basis of assumptions.
15. If an assessee leaves the department guessing as regards nature and quality of the goods imported then his intention is prima facie suspect, and he cannot be given the benefit of suppression of the facts.
16. Tribunal's orders in Walia Enterprise, Amritsar v. C.C. & C.E., Chandigarh, cited by the appellants in their favour, and considered by my learned brothers in the foregoing judgment, to my mind, has no applicability at all in the given facts of this case.