Judgment:
1. When this appeal of the Revenue was called out for hearing, the learned Counsel appearing for the respondent-importer states that, the respondent has filed cross-objections and that, on instructions, he does not press for the cross-objections. In view of this statement, we have proceeded to hear the appeal of the Revenue treating the cross-objections as not pressed.
2. The Revenue has challenged the order dated 25^th October, 2004 made by the Commissioner on the ground that, the value of Rs. 6.37 per piece of synchronous motor 49 TYJ type, was determined on a lower side.
Though in the appeal memo, reference is made to the value of Rs. 12.77 per such motor imported under the Bill of Entry dated 1.1.2004 for submitting that the said value should have been adopted under Rule 6 being of the contemporaneous import, during the arguments the learned authorized representative for the Department has contended that, the synchronous motor being of AC type, the transaction value of contemporaneous imports of such AC type motors, which was Rs. 18.58 per unit, should have been accepted. It is contended that, since the contemporaneous imports of similar AC type motors were noticed by the Commissioner, in paragraph 17 of the impugned order, it was open for the Revenue to contend that the comparable value of Rs. 18.58 per unit should be adopted.
3. The learned Counsel appearing for the Respondent, relying upon the provisions of Sub-rule (3) of Rule 5 of Customs Valuation Rules, 1988 submitted that, if the cluster of transactions which included the contemporaneous import under the Bill of Entry dated 1.1.2004 in respect of synchronous motor 49 TYJ valued at Rs. 12.77 per unit were to be taken into account, the lowest value of Rs. 4.43 shown for the imports covered under the Bills of Entry dated 30.1.2004 will have to be accepted in consonance with Rule 5(3) of the said Rules. He submitted that, the Revenue was better off by the Commissioner's adopting the value of the goods at Rs. 6.37 on the basis of NIDB data by referring to the import on 7^th April, 2004, of a quantity of 1,60,000 units at Rs. 6.37 per piece.
4. Since the learned Counsel for the respondent has, on instructions, not pressed for the cross-objections, the cross-objections are disposed of as not pressed. Therefore, there is no scope for adopting the lower price of Rs. 4.43 per unit as against the price of Rs. 6.37 per piece adopted by the Commissioner.
5. The short question that remains to be considered is, whether the value of Rs. 12.77 per unit should be accepted as urged in the memo of appeal and further, could the still higher value of Rs. 18.43, which was the minimum of the transactions tabulated in paragraph 7 of the show cause notice, should be allowed.
6. The provision of Sub-rule (3) of Rule 5 which require that the lowest of the value of identical goods, when there are more than one transactions, should be used in determining the value of imported goods precludes acceptance of the value of Rs. 12.77 per unit, because from amongst those transactions, which are clubbed together and referred to in paragraph 41 of the impugned order, the lowest value of synchronous motor 49 TYJ was Rs. 4.43 per unit. The learned Commissioner has, in para 49 of the impugned order, found that, the value declared by the importer in the Bill of Entry (Rs. 3.64) was on the lower side and that the imports of synchronous motors noticed in the other imports were comparatively of higher value. It was held that, no information was available to categorize the other imports as identical or similar goods. He, therefore, proceeded to re-determine the value by resorting to the provisions of Rule 6. Neither side has objected to the Commissioner relying upon the provisions of Rule 6. However, the dispute is raised by the Revenue against his accepting the value of Rs. 6.37 per piece on the strength of the import made on 07^th April, 2004 picked from the NIDB data. The main grievance of the Revenue, as articulated by the learned authorized representative for the Department is that, the instance, relied upon was of a DC motor. The tabulated NIDB data was referred to on behalf of the Revenue to point out that, the sub-heading shown against the said transaction was 85013119 which was of "other" DC motors. It was submitted that, admittedly, the motors imported by the Respondents were AC motors which would fall under sub-heading 85011020 and, therefore, the Commissioner has placed reliance on an instance which was not comparable. It was submitted that as per the comparable instances, which were set out in para 7 of the show cause notice, and reproduced in para 7 of the impugned order, the minimum value per unit of the contemporaneous imports of synchronous 49 TYJ was Rs. 18.73 per unit which ought to be adopted. Apart from the fact that, there has been a shift of stand from the grounds raised in the appeal memo under which value of Rs. 12.77 per unit was relied upon, the purported reliance during the submissions on the value of Rs. 18.58, which was sought to be justified on the ground that the motors imported under those transactions were AC. It is not disputed that the motors which were imported under the Bills of Entry tabulated in para 7 of the impugned order, were 4W motors and not 3W motors which were imported by the respondents. The learned Commissioner in para 47.2.3 of the impugned order has considered the characteristic of the synchronous 49 TYJ type motors and observed that the Department sought to compare the imported goods with the goods having different wattage i.e 3W as against 4W, and also having different diameter, width and weight.
Since, on this basis, the Commissioner found that the goods were not identical or similar based on technical specifications, he resorted to the import of synchronous motors made on 7^th April, 2004 showing the value at Rs. 6.37 per piece. The Commissioner has rightly observed in the context of the instances sought to be relied upon by the Revenue that there was bound to be variation in the price of 4W motors and 3W motors. He held that, it was obvious that, to get lesser wattage, reducing the turns of copper wire or using thinner copper wire was resorted to. This would obviously result in lesser weight of copper contents, the value of which played a predominant role. Even the size would differ. The Commissioner was, therefore, justified in resorting to the contemporaneous import made on 7^th April, 2004 reflecting the price of Rs. 6.37 per piece. In the NIBD data, the instance relied upon by the Commissioner is described as synchronous motors. It appears that, the value of Rs. 6.37 per unit of synchronous motor, covered under the entry, which is relied upon was the lowest in comparison to other entries in the NIBD data of synchronous motors.
7. The learned authorized representative for the Department has contended that, the entry relied upon related to DC motors. This he argued on the basis of the Customs Tariff Heading 85011019 shown against that entry. It will, however, appear that in similar NIBD data, which is also on record for synchronous motors 220V/240V 50/60HZ which obviously were AC motors, the tariff heading shown was 85011019 as against the import under the Bill of Entry dated 04.1.2003. The said sub-heading 85011019 is the item "other" falling under the sub-heading 'DC motors'. Therefore, the data entry in respect of the Bill of Entry dated 04.01.2003 has given the wrong description of the tariff sub-heading showing AC motors as DC motors. Moreover, the factual dispute on the basis of DC and AC. type of motors which is now sought to be raised was admittedly not raised by the Revenue in the show cause notice or during the proceedings before the Commissioner.
8. Therefore, much importance cannot be attached to the description of the customs tariff heading, when the Commissioner has after proper scrutiny found that the synchronous motors imported under the Bill dated 04.07.2004 showing value of Rs. 6.37 per unit provided reliable comparable instance for determining the value of the goods imported by resorting to Rule 6 of the said Rules.
9. We find ourselves in complete agreement with the reasoning and the findings of the impugned order, and there is no warrant for any interference with it. The appeal is, therefore, dismissed. The cross-objections are also dismissed as they are not pressed.
(Dictated and pronounced in the open Court on the 6^th day of September, 2007)