Judgment:
Per P.K. Das
The relevant facts of the case in brief, are that the appellants filed bill of entry No.808/2004-2005 dated 30.06.2004 for clearance of 504 nos. of old and used Main Frame assemblies of photocopier declaring the total value of Rs.21,16,152/-. The Commissioner rejected the declared value and determined the value of Rs.43,02,438/- under Rule 8 of the Customs Valuation Rules. He also confiscated the goods under Section 111 (d) of Customs Act, 1962 for violation of the EXIM Policy and imposed redemption fine of Rs.6,40,000/- and penalty of Rs.85,000/- under Section 112 (a) of the Customs Act for contravention of Customs Act/EXIM Policy. 2. The learned advocate Shri N. Viswanathan submits that they have imported old and used Main Frame assemblies of photocopiers, which is not a restricted item and confiscation, imposition of fine and penalty are not sustainable. He further submits that the Chartered Engineer certificate cannot be rejected on the basis of another certificate obtained by the department after filing of the bill of entry, especially as genuineness of former was not doubted. He relied upon the decision of the Tribunal in the case of Anish Kumar Spinning Mills Vs Commissioner of Customs, Tuticorin [2004 (172) E.L.T. 394 (Tri.-Chennai)] which was upheld by the Hon’ble Supreme Court as reported in 2005 (182) E.L.T. A92 (S.C.). He also submits that the Commissioner rejected the Chartered Engineer’s certificate obtained by the department and arbitrarily proceeded on his own, which is not permissible under the law. He relied upon the decision on both the issues of the Tribunal as under:-
(i) M/s.Maharashtra Services Vs Commissioner of Customs, Trichy [Final Order Nos.505, 506/31.03.2009] and
(ii) BE office Automation (P) Ltd. Vs Commissioner of Customs, Mumbai [2004 (17) E.L.T.460 (Tri.-Del.)].
(iii) V.S. Palanisamy Company Vs Commissioner of Customs, Turicorin [2005 (182) E.L.T.262 (Tri.-Chennai)].
2. The learned SDR Shri C. Dhanasekaran on behalf of the Revenue reiterates the findings of the Commissioner. He submits that in this case, the sales invoice is manipulated. He also submits that the Chartered Engineer’s certificates were vague and, therefore, the said certificates are not reliable. Hence, the Commissioner rightly determined the value under Rule 8 of the Valuation Rules after considering the relevant records. He submits the case law relied upon by the learned advocate are not applicable in the present facts and circumstances of the case.
3. After hearing both sides and on perusal of the records, we find force in the submissions of the learned advocate insofar as that the goods cannot be confiscated under Section 111 (d) of the Customs Act. It has been alleged that the appellant contravened EXIM Policy for import of goods without specific licence. The Tribunal in the case of BE Office Automation (supra) held that main frame of photocopiers even if considered to be sub-assembly, import is permissible under OGL, policy being silent on its imports being restricted under a licence. It has been held that the main frame accounts for only 55-60% of a photocopier and, therefore, Rule 2(a) of Interpretative Rules cannot be invoked for treating a main frame as photocopier. Hence confiscation of the goods under Section 111 (d) of the Act is not sustainable.
4. Regarding enhancement of the value, we agree with the submission of learned SDR. In the impugned order, the Commissioner has observed that sales invoice produced by the appellant to Customs is only a manipulated invoice/cash receipts. The manipulated invoice cannot be accepted as transaction value. The department obtained the opinion of the Chartered Engineer M/s.Moody. It appears from the impugned order that the Chartered Engineer in his report dated 05.07.2004 reported that percentage of critical parts available in the range of 40-45% and vis-`-vis., are shown in the category of not available parts/machine parts. It is revealed from the Customs examination that there was a presence of few PCBs. The Chartered Engineer in his subsequent report dated 16.07.2004 confirmed the presence of few PCBs. Therefore, the expert opinion is misconceived and cannot be relied upon. We do not find any serious attempt on the part of the appellant to refute the findings of the Commissioner in the impugned order. Therefore, the Commissioner rightly determined the value under Rule 8 of the Customs Valuation Rules. We have also noted that the Commissioner while determining the value had reduced the value as proposed in the show-cause notice. So, there is no justification to interfere the order of the Commissioner in respect of enhancement of value. The case laws relied upon by the learned advocate are not applicable in the present case.
5. In view of the above discussions, the impugned order is modified insofar and confiscation, redemption fine and penalty are set aside. The appeal filed by the appellant is partly allowed.