[Order per : C.N.B. Nair, Member (T)]. - The appellants imported two consignments of Lignea Cassia weighing 2.303 M.T. and 9.212 M.T. respectively and sought assessment of the goods at the declared value of US $ 1025 per MT CIF Ex. Bombay. The Customs authorities loaded the price to the rate of Rs. 44.44 per kg. CIF as against declared value of over Rs. 36.74 per kg. They also took the weight of the goods as 50 kg. per package as against the declared weight of 47 kg. per package thus, holding that there was an excess import of 808.50 kgs. The Customs authorities confiscated the goods under Section 111(d) and 111(m) for misdeclaration and non-production of import licence and gave an option to redeem them on a redemption fine of Rs. 50,000/-. Penalties of Rs. 25,000/- and Rs. 50,000/- were also imposed on the appellants for the import of the two consignments.
2. The appellants took the matter in appeal before the Commissioner of Customs (A), New Delhi. They submitted that the actual weight of the consignment was only 47 kgs. per package and the excess weight is on account of the hygroscopic nature of the goods. With regard to value, they submitted that the declared value represented the transaction value and the Customs authorities were not justified in rejecting the transaction value and adopting the higher value of Rs. 44.44 purportedly on the basis of import prices at Bombay. The Commissioner (A) allowed the appeal accepting the explanations and submissions of the appellants. He noted that the goods in question are hygroscopic in nature and absorb moisture from the atmosphere. He noted that the inspection certificate issued by the authorities of the People’s Republic of China had accepted the net weight as 47 kg. per package. He also observed that guide book “US Spice Trade ‘ASTA’ American Spice Trade Association” shows 14% moisture level for Cassia, which would work out to more than 3 kgs. per package. In the light of these facts, he held that there was no logical basis for holding that there was export of excess quantity or that the quantity of import was mis-declared. With regard to valuation, the Commissioner noted that assessment to Customs duty was to be done according to transaction value and in case transaction value is not accepted, the value is to be determined sequentially following Rules 5 to 8 of Customs Valuation Rules, 1988. As against this, the Customs authorities had assessed the goods as per provisions of Rule 6 by applying the analogy of value of similar goods. This has also been done without giving the reasons as to how transaction value was being discarded. The Commissioner also found that the lower authority had not disclosed any documentary evidence to substantiate the basis for his arriving at the higher assessable value. There was only an observation that assessments at Bombay of Cassia was at Rs. 44.44 while it has not been shown that the Cassia under import was of the same brand and quality and that transactions were at the same commercial or quantitative level. The Commissioner held such valuation to be not correct as CEGAT had held in the case of M/s. Honesty Trader v. CC [] that for the purpose of Section 14(1)(a) comparison of value should be in respect of goods of same physical characteristics, quality, reputation, country of origin and timing of import. The Commissioner also held that the Revenue had not discharged the burden of proving the charge of under valuation as held by the Supreme Court in the case Mirah Exports (P) Ltd. [ (S.C.) = 1998 (25) RLT 1 (S.C.)]. The Commissioner also relied on the decision of the Supreme Court in the case of Basant Industries v. Addl. Collector of Customs, Bombay [ (S.C.)] wherein the Apex Court held that mere comparison of invoices with the invoice of imports of same goods by other importers is not conclusive to prove under-valuation. He also took note of the observation of the High Court of Calcutta in the case of Sushil Kumar v. A.C. Customs [] that onus is on the Department to prove with sufficient evidence relating to comparable goods imported in comparable quantity from the same country of origin and the comparable time and place, otherwise invoice value is to be accepted. The Commissioner (A) also noted that the Revenue authorities have not given to the appellant any evidence regarding value of comparable imports to discharge the burden of proving that the declared value did not conform to Section 14 of the Customs Act.
3. The present appeals have been filed by the Commissioner of Customs against the aforesaid order-in-appeal of the Commissioner of Customs (A). The appeal states that the order of the Commissioner is not correct or legal on the issue of the quantity under import or the value of the imported goods. It contends that the Commissioner has accepted the difference in weight in the absence of any evidence regarding the actual moisture at the time of export of the goods or their weighment by the Customs. With regard to valuation the appeal contends that the Commissioner has not satisfactorily established why transaction price being taken for assessment at Bombay for similar goods could not be accepted when the billing price was far below the price quoted.
4. These contentions were reiterated during arguments on behalf of the appellant-Commissioner. As against these contentions of the Revenue, ld. Counsel for the respondents has submitted that no creditable case has been made in the appeal to warrant setting aside of the order-in-appeal. It was submitted that as the goods are admittedly hygroscopic, certain variation in weight over a period of several months between their export from Hong Kong and their clearance in India is to be treated as normal. The declared weight i.e. 47 kgs. net per package remains certified by the Guangdong Import and Export Commodity Inspection Bureau of the People’s Republic of China in their Inspection Report of Quality and Weight. The sale and purchase were also at this weight. It is clear from the guide book “US Spice Trade ‘ASTA’ American Spice Trade Association” which was referred to in the order-in-appeal that up to 14% moisture can be found in Cassia. The ld. Counsel has submitted that in these facts and circumstances no error or illegality could be attributed to the order of the Commissioner (A) with regard to his finding regarding the quantity of the goods under import. It was submitted that the Commissioner’s finding regarding valuation also could not be assailed as the Revenue had not put forth any evidence or reasons to show that the declared value was not the correct transaction value. The Revenue had also not shown that comparable goods were being imported at higher value. The adjudication order only mentions that print out of similar goods cleared at Bombay Customs House was taken which showed that more than 90% consignments have been cleared at Rs. 44.44 per k.g. No particulars have been given about any specific consignments. It had not also been shown as to how the imports at Bombay were considered to be comparable with regard to physical characteristics, quality, reputation, country of origin and timing of import. Under these circumstances, the Commissioner (A) was correct in holding that the original authority had neither shown that the declared value did not represent the transaction value nor established that comparable goods were being imported at a higher price. The ld. Counsel placed emphasis on the decision of the Supreme Court in Basant Industries (supra). He also referred to the decision in the case of Elite Packaging Industries [] wherein it was held that for the purpose of comparison, the imports must be at the same commercial level and same quantity. The ld. Counsel submitted that the finding of the Commissioner (A) is in confirmity with the decisions of the Supreme Court, the Calcutta High Court and the Tribunal with regard to the principles of valuation of imported goods and the order is required to be confirmed and the appeal rejected.
5. The dispute in the instant case is with regard to quantity of the import and the valuation of the goods. The difference in quantity between consigned and received goods is 3 kgs. per package/bag of 47 kgs. which works out to over 6%. The appellants had explained that this is because of the hygroscopic nature of the cargo. They had also shown with the help of guide book “US Spice Trade ‘ASTA’ American Spice Trade Association” that presence of moisture in Cassia up to 14% is accepted according to American standards. There was time lag of several months between the loading of the goods and their clearance in India. The buyer and seller had dealt with the goods on the basis of the declared weight. The inspection agency of the exporting country had also certified the weight. In these circumstances, we find no reason to fault the finding of the Commissioner that difference in weight is on account of the nature of the cargo and allegation of misdeclaration of weight is not justified or warranted. With regard to the value of the goods it is observed that no evidence has been produced by the Revenue to show that the invoice value was not the transaction value. No specific evidence has also been adduced to show that the invoice value was much lower than the value of contemporaneous imports. Even though a print out showing import prices at Bombay has been referred to in the order-in-original, specific reliance has not been made on any particular import. Therefore, the finding in the order-in-original regarding contemporaneous imports at higher value remains general and vague. In order to base the assessment on contemporaneous imports, it is necessary that the Revenue authorities establish with the help of specific imports that goods comparable in physical characteristics, quality, reputation, country of origin and timing of import are being imported at higher value. Since this requirement has not been met in the instant case, the Commissioner was correct in holding that rejection of the transaction value was not justified in the instant case. Therefore, this finding also cannot be found fault with. Contentions in the appeal are too general and vague and are against the correct legal position with regard to valuation of imported goods. Accordingly, we find no merit in the appeals. They are dismissed.