1. This is an appeal against the order dated 30-8-1990 passed by the Collector of Customs (Appeals), Delhi. The appellant was posted as First Secretary in the Indian Embassy, Kathman-du. During his stay in Kathmandu he imported a Nissan Datsun Car - Model No. B 310 UGL. After using the car in Nepal for more than five years he brought it to India against a valid Customs Clearance Permit. Bill of Entry No. 010, dated 14-9-1987 was filed in Delhi Customs House for the clearance of the car. Along with the Bill of Entry, the appellant filed Invoice No.M/11993/2-B, dated 3-2-1982 issued by M/s. Nippon Trading Co. Ltd., Japan which indicated the FOB and CIF prices of the imported car as US $ 3,155.20 and US $ 4,013.65 respectively. The appellant had also obtained another invoice from the supplier bearing the same number and date in respect of the imported car which indicated the CIF price as Japanese Yen 1,010,000. The Assistant Collector of Customs, Delhi determined the assessable value of the car on the basis of the invoice which showed the CIF price as US dollars 4,013.65 and turned down the appellant's request for assessment of the car on the basis of the invoice showing the CIF price in Japanese currency and also rejected the appellant's request for 15% trade discount on the invoice value.
The Assistant Collector worked out the assessable value of the car as Rs. 40,328 after granting depreciation of 46% having regard to the period of use prior to its importation and a further depreciation of Rs. 1000 taking into account the condition of the car. The appellant's claim for acceptance of the suppliers' invoice in terms of the Japanese currency was turned down on the ground that according to established practice the assessable value of import car is determinable in terms of the Manufacturers' List Price prevailing in the country of manufacture and accordingly the price of the car has to be expressed in terms of the currency of the country in which the car is manufactured. He also rejected the appellant's request for 15% discount on the invoice price on the grounds that the trade discount of 15% was admissible only in respect of vehicles assessed on the basis of the price indicated in the World Car Catalogue or the Manufacturers' Price List. Being aggrieved by the order passed by the Assistant Collector, the appellant filed an appeal before the Collector of Customs (Appeals) who while confirming the order passed by the Assistant Collector observed as under :- "I have carefully examined the submissions in the appeal. As per the prevailing customs practice, if the manufacturers' invoice is not produced, the valuation is done on the basis of manufacturer's 'price list' showing ex-works prices. No Trading Discount is allowed on these prices as manufacturers themselves discounted these prices to the customers; when the Manufacturer's invoice or the manufacturer's price list is not available, recourse to world car catalogue is taken where valuation is done after giving 15% trade discount. Further, the price is to take from the manufacturer's price list/ex-works price given in the world car catalogue and since these prices and given is the currency of country of manufacture, the same are to be taken for the purpose of assessment, irrespective of the currency in which payment has been made by the passenger/importer.
In view of the above, I observe that in this case, in the manufacturer's invoice dated 3-2-1982, the car price shown in the currency of country of manufacture i.e. J. Yen and the same has been accepted by the customs and the denial of trade discount 15% by the Asstt. Collector is correct. There is no merit in the plea of the appellant warranting any interference with the impugned order and the appeal is rejected accordingly." 2. On behalf of the appellant, Shri N. C. Sogani, Learned Consultant appeared before us. He submitted that the car in question prior to its importation into India was imported into Nepal by the appellant through the Nepalese agent of M/s. Nippon Trading Co. Ltd. of Japan. He stated that even though the appellant had received two separate invoices, one showing the price of the car in U.S. dollars and the other in terms of Japanese currency, the actual payment through the Nepalese agent of M/s. Nippon Trading Co. Ltd. of Japan, the sole suppliers of Nissan car, was made in U.S. dollars. He added that the Nepalese agent of Nippon Trading Co. Ltd., Japan had certified that the payment for the car was made in U.S. dollars. Shri N.C. Sogani contended that the reasoning of the lower authorities for rejection of the invoice in terms of U.S. dollars was without any basis since the law does not provide for assessment of goods only on the basis of invoice showing the price in terms of the currency of the exporting country. He submitted that in international trade goods are invoiced in different convertible currencies depending upon the terms of the agreement between the buyer and seller. On this ground he prayed that the re-assessment of the car imported by the appellant in terms of the invoice in U.S. dollars issued by Nippon Trading Co. of Japan may be ordered. Continuing his submission, Shri Sogani stated that the car in question was assessed on the basis of the invoice price since the car of the particular model was not figuring in the World Car Catalogue and the Manufacturers' price list was also not available. He contended that the invoice having been issued by Nippon Trading Co. Japan, the sole selling agent of Nissan cars, their invoice price is bound to be higher than the price that would have been shown in the manufacturers' price list had it been available. He argued that under these circumstances the decision of the lower authorities to disallow the trade discount of 15% on the invoice price was unreasonable. He prayed that while ordering re-assessment of the car, the lower authorities may be directed to allow the usual trade discount of 15%. He also submitted that the overall depreciation in respect of the imported car was not correctly worked out and contended that it ought to have been worked out in accordance with the scale for depreciation laid down by the Board in respect of imported second-hand machinery.
3. On behalf of the respondent Shri Satish Shah, JDR reiterated the findings of the Collector (Appeals) in the impugned order. He submitted that the point made by the Learned Consultant in regard to depreciation not having been raised before the lower authorities and in the grounds of appeal cannot be raised for the first time at this stage before the Tribunal.
4. We have considered the submissions made on behalf of both sides. It is seen that the appellant had imported a Nissan Datsun Car - Model No.B 310, U.G.L. into Nepal during his stay in that country between 1981 and 1987. He had placed the order for the car on Nippon Trading Co.
Ltd., the sole distributors of Nissan Motors, Japan through Nepal Impex (P) Ltd. Kathman-du, the distributor of Nissan Motor Co. Ltd. in Nepal.
The appellant had received two invoices for the car in question, one showing the price in U.S. dollars and the other in terms of Japanese currency. However, as seen from the certificate dated 25-1-1982 issued by M/s. Nepal Impex (P) Ltd. (Annexure J to the Appeal Memo) the payment for the car in question was made in terms of U.S. dollars.
Since the payment for the car in question was made by the appellant in U.S. dollars and in view of the fact that in international trade it is a common practice to issue invoices in respect of the exported goods in terms of currencies other than the currency of the country of origin of the goods, we hold that the order passed by the lower authorities rejecting the invoice showing the price of the car imported by the appellant in terms of U.S. dollars is not sustainable.
5. The second point raised by the appellant is that 15% discount should have been allowed on the invoice price which was adopted for the purpose of determining the assessable value in the absence of the relevant world price catalogue and manufacturers' list price. In this regard we find that in the case of Prem Kumar v. Collector of Customs reported in 1989 (40) E.L.T. 340, the Tribunal had held that valuation of cars imported by passengers has to be based on World Car Catalogue price of same model less 15% discount and in case the World Car Catalogue Price is not available with Customs House, the manufacturer's net price to wholesale dealers in the course of international trade has to be ascertained for the purpose of assessment and if either of these courses is not feasible, assessment has to be made on the invoice price without granting 15% trade discount. Para 3 of the said order being relevant is reproduced below :- "3. The appellant contended before us that the invoice price was not a discounted price. The learned representative of the department maintained, on the basis of his experience in the customs department, that the invoice price to the export passengers (like the present appellant) was a discounted price. He, therefore, opposed the grant of any further discount to the appellant. However, he had no objection to the car being assessed at the manufacturer's net price to wholesale dealers in the course of international trade.
But there could be no further 15% discount on the already net wholesale price. 15% discount was given on the retailers' list price.
We have had the benefit of experience of dealing with a large number of cases of valuation and assessment of imported cars. It is well within our knowledge that the general practice of the customs department is to base the valuation on the World Car Catalogue Price and give 15% discount thereon. The idea is to get at the price at which the like goods are ordinarily sold in wholesale in the course of international trade, as required by Section 14(1)(a) of the Customs Act, 1962. Resort is had to the individual invoice prices of the passengers only if the World Car Catalogue Price of the model is not available. We order that the same basis should be followed in the case of the present appellant also and his car re-assessed on the basis of the World Car Catalogue Price of the same model less 15% discount. On our asking the appellant was not in a position to show us the World Car Catalogue Price but he maintained that the said price was available with the Customs House. In case the World Car Catalogue Price is not available with the Customs House, the customs may ascertain the manufacturer's net price to wholesale dealers in the course of international trade in any other manner. If this course is also not feasible, the assessment may be maintained at the appellant's invoice price. There is no question of granting the 15% discount on the individual export passenger's invoice price.
6. We are inclined to agree with the learned JDR that the contention of the learned Consultant that the depreciation for the purpose of valuation of the imported car needs to be revised on the basis of the scale of depreciation laid down by the Board for the purposes of valuation of used imported machinery need not be examined by us, since it was neither raised before the lower authorities nor raised as a ground for appeal.
7. In view of the above discussion, we hold that the invoice issued in U.S. currency by the supplier in Japan in respect of the car imported by the appellant is acceptable for the purpose of determining the assessable value. However, no trade discount is admissible since the assessment was done on the basis of the invoice issued by the distributor of the car in the country of export.
8. In terms of para 5 above, the appeal is partly allowed with consequential relief to the appellant.