[Order per : Archana Wadhwa, Member (J)]. - All these appeals arise out of the same impugned order of Commissioner vide which he has lowered the FOB value of CD Roms exported by M/s. Advance Exports, resulting in lowering of DEPB credit and has also imposed personal penalty of Rs. 30 lakhs on the said appellant. In addition, personal penalty of Rs. 5 lakhs stand imposed on Shri Rajesh Adani, partner of M/s. Advance Exports with imposition of identical amounts of personal penalties on M/s. G.A. International, Dubai and Shri Vinod Shah of M/s. G.A. International.

2. After hearing Shri V.S. Nankani, learned Advocate appearing for the appellants and Shri K.M. Mondal, learned Consultant for the Revenue, we find that the dispute in the present appeal relates to the export value of 60,000 pcs. of CD Roms exported by M/s. Advance Export to one M/s. Wajilam Export (Singapore Pvt. Ltd., Singapore). The said goods were exported under five shipping bills all dated 15-12-1998 in terms of a contract dated 2-11-98 entered into by M/s. Advance Exports with M/s. Wajilam Export of Singapore. The goods were exported under claim for DEPB at the declared value of US $ 18 per CD Rom. In support of the value, the appellants produced on record the invoices under which the same were procured by them from the Indian Manufacturer M/s. Padmini Polymers Pvt. Ltd. The goods were cleared by M/s. Padmini Polymers under AR-4 at the purchase price of Rs. 750/- per pc. The payment for the said goods was made by M/s. Advance Exports to M/s. Padmini Polymers vide cheque dated 15-2-1999 drawn on State Bank of Travancore, Ahmedabad. The goods were assessed on the shipping bill and order for clearance for export under Section 51 of the Customs Act was passed and the goods exported.

3. However, subsequently on the basis of some information as regards the over-valuation of CD Roms, investigations were initiated. During the course of investigation, Revenue found that part of the export realization was received from M/s. Wajilam Exports, Singapore whereas an amount of US$ 8,29,993.50 was received from M/s. G.A. International of Dubai. Further investigation revealed that said M/s. G.A. International of Dubai was a company managed by Shri Rajesh Adani, partner of M/s. Advance Exports. It was also found that the payment made by M/s. Advance Exports to M/s. Padmini Polymers Ltd. as consideration for the CD Roms purchased by them, was subsequently deposited by M/s. Padmini Polymers in the Bank Account of M/s. Adani Exports Ltd., which was a sister company of M/s. Advance Exports.

4. On the above basis, proceedings were initiated against the appellant by way of issuance of show cause notice, which culminated into the impugned order passed by the Commissioner.

5. Learned Advocate Shri V.S. Nankani appearing for the appellant is strongly contested that CD Roms purchased by them from M/s. Padmini Polymers Ltd., was on principal to principal basis for which consideration was duly paid to them. Any subsequent transaction advanced by M/s. Padmini Polymers Ltd. and M/s. Adani Exports cannot cast any adverse reflection on the appellant’s transaction with Padmini Polymers. Shri Nankani submits that during the course of adjudication, they have produced on record certificate of Chartered Accountant of M/s. Adani Exports to the effect that there is running account between M/s. Adani Exports and M/s. Padmini Polymers to the extent of Rs. 109 crore. As such, any deposit made by M/s. Padmini Polymers in the account of M/s. Adani Exports, which is a private limited company, can have no reflection on the purchase value of the CD Roms by the appellant. He, further, submits that the Revenue has not conducted any investigation at M/s. Padmini Polymers Ltd. end as regards the value of the CD Roms and has not disturbed the value at which the same stands sold to the appellant. Inasmuch as the export value of the goods was within the range of 150% of the market price, the same could not have been disturbed by the Revenue in terms of the Board Circular No. 69/97-Cus. dated 8-12-1997. He submits that in identical matters, the Tribunal has accepted the purchase price of other exporter from M/s. Padmini Polymers as Rs. 640 per piece. As such, the department’s contention that there was over-valuation of the goods cannot be accepted. Similarly, as regards the realization of the value of the goods from foreign buyers, he submits that it is not disputed by the Revenue that the entire realization stands received by the appellant and the fact that a part of the same has come directly from Singapore and another part stands remitted from Dubai, cannot be made the basis for discounting the value. He also draws our attention to the ‘activity report’ of the Bank produced on record by learned Consultant, Shri Mondal appearing for the Revenue, which makes it clear that the remittance was with reference to the export made to M/s. Wajilam Exports. He also draws our attention to the various decisions, in support of his above submissions and particularly referred the four cases of import-export of CD Roms mentioned in the show cause notice and submits that all the relevant cases of the Revenue stand rejected by the Tribunal. The various pleas raised by the appellant stand summarized as follows :-

(i)      Declared value of export goods cannot be rejected under Section - 14 of the Customs Act, 1962 in absence of contemporary exports of identical goods at lower price.

•        Kanhaiya Exports (P) Ltd. v. Commr. of Cus. (Port,) to Kolkata - [para 3(b)]

•        Commr. of Cus., Calcutta v. Ramapati Exports. - [paras 11 & 12]

•        Commr. of Cus., Kandla v. Crown International - (Tri. - Mum) [para 2.3(c)].

•        Polynova Chemical Industries v. Commr. of Cus., Mumbai - (Tri.-Mum) [paras 2(b)(1)(2)]

•        Akshay Exports & Inds. v. Commr. of Cus., Mumbai - (Tri.-Cal) [para 4]

(ii)    Price declared by the manufacturer namely Padmini Polymers to Central Excise at which goods were sold to the appellant has not been challenged or set aside.

(iii)   As per board Circular No. 69/97-Cus., dated 8-12-97, where the FOB value is within 150% of the manufacturer’s price, the same cannot be rejected.

•        Cannon Steel Pvt. Ltd. v. Commr. of Cus., Cochin - (Tri.-Del) [para 5]

•        Commr. of Cus., Kandla v. Crown International - (Tri.-Mum) [para 2.3(a)(b)]

(iv)   Export value declared in the shipping bill having been duly accepted by the "proper officer" who assessed the shipping bill and ordered clearance for export under Section 51 of the Customs Act, the same cannot be challenged by a show cause notice unless the order of assessment of the proper officer is appealed against under the provisions of Section 129(d) of the Customs Act, 1962.

•        Commr. of Cus. (Imports) Mum. v. Hindustan Gas & Industries Ltd. - (Tri.-Mum) [para 1.6].

(v)     When foreign exchange equal to the FOB value has been realized as per the bank realization certificate against the export invoices, there is no justification to question the FOB value.

•        Commr. of Cus., Kandla v. Crown International - (Tri.-Mum) [para 2.3 (c)]

•        Wescon Exports Pvt. Ltd. v. C.C. & C.E., Goa - 2007 (78) R.L.T. 175 (Tri.-Mum.) [para 11]

•        Polynova Chemical Industries v. Commr. of Cus., Mumbai -2005 (179) E.L.T. (Tri.-Mum) [para 2 (b) (i)]

(vi)   Mere fact that part of the export price was not directly received from the foreign buyer Wajilam Exports but was remitted by G.A. International cannot by itself lead to the conclusion that amount remitted by G.A. International was not towards the price of the goods.

•        Wescon Exports Pvt. Ltd. v. CC & CE, Goa - 2007 (75) R.L.T. 175. (CEGAT-Mum)

(vii)  The bank realization certificates clearly show that even the amount remitted by G.A. International was against the invoices raised on Wajilam Exports and the said remittance has been appropriated by the bank towards the said export invoices.

(viii) Even under the Foreign Exchange Regulation Act, the remittance by G.A. International has been accepted towards the export invoices and no objection has been raised by the RBI.

(ix)   The bank activity report relied upon by the department shows that the amount remitted by G.A. International is on account of Wajilam Exports.

(x)     Assuming while denying that there was over-valuation of the goods exported under DEPB claim, the customs have no jurisdiction to pass an order restricting the DEPB credit and the same can only be done by the DGFT authorities.

•        Polynova Chemical Industries v. Commr. of Cus., Mumbai - (Tri.-Mum).

•        Alphonse Joseph v. Commr. of C.Ex. & Cus, Bangalore - (Tri-Bang).

•        Kobian ECS India Pvt. Ltd. v. Comm. of Customs, Mumbai - (Tri.-Mum).

•        Adani Exports Ltd. v. Assistant Commr. of Cus., Cochin - (Tri.- Bang).

6. As against the above submissions, learned Advocate Shri Mondal has drawn our attention to the fact that M/s. Wajilam Exports was a partnership firm of two Gujaratis and the various facts on record clearly show that the entire operation was managed. He submits that all the firms including G.A. International and Adani Exports are companies managed by four Adani Brothers and the receipt of payment from M/s. G.A. International for the goods exported to M/s. Wajilam Exports are clearly indicative of the fact that the value of the goods was over assessed. He also highlighted the stand that the payment received by M/s. Padmini Polymers was subsequently deposited in the Bank Account of M/s. Adani Exports.

7. In a rejoinder, Shri Nankani submits that if the Revenue’s case is that entire consideration of Rs. 3.84 crores paid by M/s. Advance Exports to M/s. Padmini Polymers and subsequently deposited by them in the Bank Account of M/s. Adani Exports was on the account of present transaction is accepted, the same would lead to infructuous fact that nothing was paid by M/s. Advance Exports to M/s. Padmini Polymers for procurement of 60,000 pcs. of CD Rom. He, accordingly, questions the Revenue’s stand that if that be a case, why the remittance received from M/s. Wajilam Exports is being held as a correct export value and as to why benefit to that extent is being extended by the Revenue.

8. We find lot of force in the above argument of learned Advocate. According to the Revenue, the payment made by Advance Exports to Padmini Polymers was deposited in the account of Adani Exports. These facts do not stand refuted by the appellant. However, they have explained that Adani Exports and Padmini Polymers were having running account to the extent of Rs.109 crore. Apart from the above fact, we find that the said deposit made by M/s. Padmini Polymers to another private limited company, which is an independent legal entity by the name of Adani . Exports by itself will not lead us to inevitable conclusion as regards the excess export value of CD Roms. In fact, if the said evidence of the Revenue is accepted, the same would amount as if no consideration stands paid to M/s. Padmini Polymers. Admittedly, M/s. Advance Export have purchased 60,000 pcs. of CD Rom from M/s. Padmini Polymers and it cannot be held that no single penny was paid for the same. As such, we find no evidentiary value to the fact of the deposit of money in the Bank Account of M/s. Adani Exports.

9. Further, the purchase value of Rs. 750/- per CD Rom, does not \ stand demolished by the department by conducting any investigation at the manufacturer’s end. No statement of M/s. Padmini Polymers stand recorded. In fact, we note that M/s. Padmini Polymer are engaged in the manufacture of CD Rom, which they are supplying to various merchant importer. Tribunal in the case of Commissioner of Customs, Kandla v. Crown International - (Tri.-Mum.) has accepted the sale price of Rs. 640/- per pc. by the same M/s. Padmini Polymers. Similarly M/s. Padmini Polymers are also engaged in the export of goods themselves. Such export price was also accepted by the department. Further, in terms of the Board Circular No. 69/97, dated 8-12-1997, if the export price within 150% of the purchase price, the same is ought to be accepted by the Revenue as held by the Tribunal in the case of Commissioner of Customs, Kolkata v. Ramapati Exports - (Tri.-Kol.), Commissioner v. Balaji Industrial and Agricultural Castings Pvt. Ltd. - (Tri.) and Cannon Steel v. Commissioner - (Tri.).

10. Similarly, we find that the Tribunal in the case of Wescon Exports Pvt. Ltd. v. CC & CE, Goa - 2007 (78) R.L.T. 175 (CESTAT-Mum) has observed that receipt of remittance from a person other than to whom the goods have been supplied by itself is no ground for the rejection of the value. We have seen Activity Report of the Bank, which is to the effect that the receipt are on account of export made to M/s. Wajilam Exports and no objection stand raised either by the Bank authorities or by other Govt. agencies. As long as the exporter has received the remittance, it is to be held that the entire export was made at the value so declared. The evidences relied upon by the Revenue may lead to some doubt but cannot take the place of legal evidences in as much the same are in the nature of assumptions and presumptions. The transactions between Padmini Polymers and Adani Exports being between two independent legal entities, especially when they are in continuous transactions with each other and have running accounts, as certified by the Chartered Accountant, cannot be linked to the purchase of CD Rom by M/s. Advance Exports. As we have already noted that M/s. Padmini Polymers sells identical goods to other buyers at the more or less same sale value, the purchase price of the goods by the appellant cannot be doubted. Similarly, the entire export value having been fully realized by the appellant, the source of the same would not effect the export value of the goods. As such, by drawing support from various decisions referred supra, and the Board’s Circular, we find no merits in the Revenue’s case.

11. Apart from above, we find that imposition of penalty on M/s. G.A.. International and Shri Rajesh Adani, partner of M/s. G.A. International is not in accordance with law inasmuch as M/s. G.A. International is admittedly a company operating from Dubai and the Customs Act has no application in foreign land.

12. In view of the above, we set aside the impugned order and allow all the appeals with consequential relief.

(Dictated and pronounced in open Court)

Customs Appeals No. 206 to 209 of 2004

13. [Order per : M. Veeraiyan, Member (T)]. - I have gone through the order proposed by my learned sister Mrs. Archana Wadhwa, Member (Judicial). As I am not in a position to agree with the same, I proceed to record a separate order.

14. To enable better appreciation of the issues, it may be appropriate to  recapitulate the relevant facts, in brief, which are as follows:

(a)     In these proceedings, the following three companies/firms of Adani Group are concerned/involved, (i) M/s. Advance Export, is a partnership firm of four brothers, namely, Rajesh Shantilal Adani, Vinod S. Adani, Vasant Adani and Gautam S. Adani, (ii) M/s. Adani exports Ltd. has Shri Rajesh S. Adani as M.D. and Mr. Gautam S. Adani as Chairman, (iii) M/s. G.A. International is a firm operating from Dubai and is managed by Shri Rajesh S. Adani (who is a partner of Advance Exports and a Director of Adani Exports Ltd.). In addition to the above 3 companies/firms Singapore based Wajilam exports is the concerned foreign buyer managed by two Indians, and Delhi based M/s. Padmini Polymers Ltd. ( PPL for short) is the supplier of CD Roms to Advance Exports which was exported.

(b)     M/s. Advance Exports, a merchant exporter, exported 60,000 pieces of CD Roms titled,” 50 years of Indian independence” under five shipping Bills all dated 15-12-1998 with a declared value of US $ 10,80,000 at the rate of US $ 18 per piece.

(c)     The CD Roms exported by M/s. Advance Exports was supplied by PPL. PPL are not copyright holders of the CD Roms supplied by them. PPL have no good track records in their dealings. They have cleared about 15,000 CD Roms in the local market, exported about 2 lakhs CD Roms directly; supplied large quantity of CD Roms to Adani Group of companies for export purpose. The direct export made by PPL was found to be overvalued to avail excess DEPB/DEEC benefits. For example, 33 DEPB licences issued to PPL involving DEPB credits of Rs. 19,44,93,767/- was cancelled by DGFT vide their order dated 30-8-2001 and they went to Settlement Commission and got the issue settled. There were also disputes about exports of CD Roms (supplied by PPL) through other exporters.

(d)    M/s. Advance Exports purchased 60,000 CD Roms from the above said PPL at a price of Rs. 750 per piece in pursuance of a contract dated 2-11-1998 with the said PPL and payments amounting about Rs. 3.84 crores were made by cheque dated 15-2-1999 by M/s. Advance Exports.

(e)     The money paid by M/s. Advance Exports to PPL has promptly been deposited to the account of M/s. Adani Exports.

(f)      The export consignments by Advance Exports covered by 5 shipping bills dated 15-12-1998 were consigned to M/s. Wajilam Exports, Singapore. Out of 10,80,000 US $ came due from Wajilam Exports, only 2,50,006.50 US $ from M/s. Wajilam Exports on 25-10-99 and the balance of 8,29,993.50 US $ came in Jan., 2000 from the account of M/s. G.A. International, UAE.

(g)     Commissioner held that sale price of CD Roms supplied by PPL to Advance Exports is highly over valued; sale proceds received by PPL was promptly transferred to Adani Exports Ltd. As major part of export realization by Advance Exports has come from its group company based at Dubai and not from Singapore based importer, Commissioner has taken the actual amount realized by Advance Exports from Singapore based importer as the export value.

(h)    The Commissioner by his order restricted the FOB value of CD Roms to Rs. 1,05,43,085/- as against the declared C & F Value of Rs. 4,65,78,600/- and also denied DEPB credits to the tune of Rs. 48,23,968/- (out of total credit of Rs. 63,00,000/- granted to them in DEPB bearing No. 0802593, dated 15-6-1999) as inadmissible. In addition, he imposed penalty of Rs. 30,00,000/- on M/s. Advance Exports, Rs. 4,00,000/- on M/s. Padmini Polymers Ltd., Rs. 5,00,000/- on M/s. G.A. International, Dubai and Rs. 5,00,000/- each on Shri Rajesh Shantilal Adani, Shri Vinod S. Adani.

(i)      Against the said order, M/s. Advance Exports, Shri Rajesh S. Adani, G.A. International and Shri Vinod S. Adani are in appeals.

15. It is to be noted that this is an export under claim for DEPB benefits. If the goods were over-valued then, consequentially, there would be claim for excess credit leading to loss of revenue at the time of import.

16. The valuation of goods for customs purposes are covered by the previous Section 14 of the Customs Act which is reproduced below :

“Section 14. Valuation of goods for purposes of assessment - (1) For the purpose of [the Customs Tariff Act, 1975 (51 of 1975)] or any other law for the time being in force whereunder a duty of Customs is chargeable on any goods by reference to their value, the value of such goods shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade, where -

(a)     the seller and the buyer have no interest in the business of each other; or

(b)     one of them has no interest in the business of the other; and the price is the sole consideration for the sale or offer for sale......”

17. It is to be noted that the provisions of Section 14 applies both in respect of imports and exports. Apart from Section 14, there are detailed valuation rules and guidelines for import valuation. However, for exports, there are no such detailed valuation rules and guidelines.

18. To accept the transaction value for exports, the transaction between the exporter and the foreign based importer should be at arms’ length, the goods should have been “ordinarily sold” and there should be no additional consideration.

18.1 Wajilam Exports, Singapore, have been supplied with consignments valued over Rs. 4 crores which was not covered by any LC or assurance for payments for the consignments which is normal practice. In fact, there has been considerable delay in receiving the payments. There is no payment of interest involved for such delay in the payment which is rather for unusual. Above all, nearly, 75% of the payments came from an Adani group of company M/s. G.A. International, Dubai. India based merchant exporter M/s. Advance Exports export to Wajilam Export, Singapore, the money has come from Dubai based firm managed by one of the partners of I Advance Exports.

18.2 G.A. International were one of the notices and Shri R.S. Adani also one of the notices and though they had the details, wherewithal at their command to explain why they have made payments on behalf of Singapore based Wajilam firm, they have not chosen to do so.

19. The purchase of CD Roms by M/s. Advance Exports is from PPL who is not having copyrights; the money paid by Advance Exports have gone into from the accounts of Adani Exports a group of company. PPL was having long standing business connection (they reportedly had a running account amounting to Rs. 109 crores). But when serious allegations were made in the notice against them and their important business associate namely, Advance Exports, they have chosen to keep silent; they have not filed any reply. In the absence of rebuttal by PPL it has to be presumed that they have nothing to say in defence on the allegations made against them.

20. It is important to remember the burden of proof depends upon the nature of issue and the persons concerned. I am reminded of a story and incident in this regard. A highly respected religious person was admonishing one of his disciples for small aberration but was very kind to a devotee with full of vices. He was not biased as he wanted both to improve from their respective positions. A school teacher was particularly happy with a student who secured 60% marks, praised him in front of entire class; at the same time severely admonished another student who has obtained 80% marks. Was the teacher biased? No. The student who got 60% marks was previously getting in the range between 30 to 40% and has remarkably improved his performance whereas the second student who got 80% was earlier getting in the range of 95 to 100% and therefore, teacher felt unhappy and duty bound to admonish the latter.

21. The principle underlying the above story and the incident is somewhat relevant in appreciating the concept of burden of proof. In a case of prosecution in a court of law, the level of proof required is not the same as in adjudication proceeding which is based on preponderance of probability. The burden of proving that any product is taxable is on the taxing authority but if an assessee wants benefit of an exemption, the burden to prove that he is eligible for exemption is on him. If a person claims a refund, then the onus of proof that he has not passed on the burden to his customer is on him. If the Department wants to penalize a person, then the burden of proof of violation is on the Department. In other words, if a person claims any benefit, he has to prove but if the department wants to punish, then the department has to prove the violation. In a case when any exporter seeks to claim the benefit, the burden should be on him.

21.1 In this particular case, serious doubts have been raised about the purchase price of Advance Exports form PPL inasmuch as, PPL is not owning any copyright and that money received by them has been promptly diverted to Adani Exports Serious doubts have also been raised about receiving of substantial part and export proceeds not directly from Singapore buyer but from G.A. International which is a group company which was incidentally managed by partner of M/s. Advance Exports.

21.2 Regarding Board’s Circular No. 69/97-Cus., dated 8-12-1997 on accepting export value based on PMV, it is a guideline to assessing officers and cannot bar any investigation based on intelligence.

21.3 The power of the Customs Department to conduct overseas investigation is limited. In this case, the Department has proved by documents that the purchase for the purpose of export and the exports are unusual and tainted and disclosed the material to the concerned parties.

22. In the light of the disclosure, it was up to the notices namely, Advance Exports, M/s. G.A. International, PPL to prove that the purchase price of CD Roms by Advance Exports and as well as export sale price by M/s. Advance Exports are genuine. Since they have failed to prove, naturally, the price declared by them has to be rejected.

23. Having rejected the price declared in the shipping bills, what should be the norms to be adopted to arrive at the value based on best judgment method? The adjudicating authority could not have ignored the amount which was directly received from Wajilam Exports (even if the same was doubted to be on the higher side) and therefore, he has adopted the said amount as the price for export for the purpose of export benefits and the said decision is reasonable and legally sustainable.

24. It is one thing to adopt a different price for assessment purposes, it is altogether a different thing to punish people for misdeclaration of the value. For example, on the import side, when value of an import consignment is enhanced, merely based on contemporaneous higher import value, there cannot be justification for imposition of penalty. In this case, while there is enough justification to ignore the value declared and restrict the value for the purpose of extending DEPB benefit but on the same level of evidence to impose penalty cannot be justified.

25. In the light of the above,

(a)     Appeal by M/s. Advance Exports is partly allowed by setting aside the penalty and upholding the denial of DEPB credit to the extent of Rs. 48,23,968/- (Rupees Forty-eight lakhs twenty-three thousand nine hundred sixty-eight only).

(b)     Appeals by G.A. International, Shri Rajesh S. Adani and Shri Vinod S. Adani are allowed by setting aside the penalties imposed on them.

Difference of Opinion

26. Whether the order as proposed by learned Member (Judicial) allowing all appeals should be approved or whether the order proposed by learned Member (Technical) should be approved.

(Pronounced on 13-6-2007)

Appeals No. C/206 to 209/04

27. [Order per : Jyoti Balasundaram, Vice-President]. - I have heard both sides on the difference of opinion between the members of the original bench, who heard the above appeals.

28. Learned Member (Judicial) has proposed setting aside of the impugned order of the Commissioner, who had lowered FOB value of CD ROMs exported by Advance Export resulting in lowering of DEPB credit and imposed penalties on the exporter and the other three appellants, accepting the contention of the exporters that the goods in question were not overvalued, while learned Member (Technical) has proposed upholding of the DEPB credit to the extent of Rs. 48,23,968/- and agreed with the learned Member (Judicial) that penalties on all the appellants are required to be set aside.

29. The reasoning of the learned Member (Technical) is inter alia that M/s. G.A. International, who made nearly 75% of the payment for the goods, and that Mr. R.S. Adani, on whom penalties were proposed to be imposed, did not come forth to explain why they had made payments on behalf of the Singapore based firm M/s. Wajilam Exports to whom the CD ROMs were supplied. He has also based his findings upon the fact that M/s. Padmini Polymers Ltd. (hereinafter referred to as PPL), who supplied the CD ROMs to the exporter firm, did not respond to the show cause notice. In other words, he has held that the burden of proving that the value of the goods had been correctly declared lies upon the exporter and supplier of the goods.

30. I find that the supplier’s price of Rs. 642.00 to Rs. 730.00 per piece has not been disputed. As per CBEC Circular No. 69/97-Cus., dated 8-12-1997 the FOB value cannot be rejected if it is within 150% of the manufacturer’s price and in the present case, since the declared price for export is Rs. 760/-, it falls within the above parameters. Further, the declared value of export goods cannot be rejected under Section 114 of the Customs Act, 1962, in the absence of any contemporary export of identical goods at lower price as held by the Tribunal in the decisions cited by the appellants before the Tribunal, namely the decisions in the case of Kanhaiya Exports Pvt. Ltd. v. C.C.E., C.C. v. Ramapati Exports, Polynova Chemical Industries v. C.C., Akshay Exports & Industries v. C.C. and C.C. v Crown International cited supra. It is relevant to note that foreign exchange equal to FOB value has been realized as per bank realization certificate against export invoices and the mere fact that part of the export price was not received directly from the foreign buyer, but was remitted by M/s. G.A. International cannot by itself lead to the conclusion that the amount remitted was not towards price of the goods particularly when the bank realization certificate shows that the amount remitted was against invoices raised on Wajilam Exports and the remittances have been appropriated by the bank towards the said export invoices. The bank activity report relied upon by the department (report of the Bank of New York) also shows that the amount remitted by M/s. G.A. International is on account of M/s. Wajilam Exports for the reason that such report refers to Wajilam Exports while giving details of payment by M/s. G.A. International of Dubai to the account of M/s. Advance Exports, the exporting firm, and the Bhadra Branch, Ahmedabad of Canara Bank has clarified that payment to the exporter by M/s. G.A. International was by order of M/s. Wajilam Exports. Further, the fact that payment made by the exporter to the supplier of the goods was deposited in the account of the exporter has been explained by his Chartered Accountant whose certificate shows that there were running transactions between PPL and the exporter.

31. Further, the Revenue also does not dispute that the facts of the present case are more or less similar to the facts of the Crown International case cited supra wherein sale price of CD ROMs manufactured by PPL (Rs. 640.00 per piece) to Crown International and the export price of Rs. 761.40 per piece of Crown International was accepted.

32. Lastly, the burden of establishing the correct value of the goods lies upon the Revenue for the reason that the exporter is not claiming any benefit of exemption but is claiming DEPB benefit which is consequent upon valuation. In this case, the department has not discharged the burden cast upon it to show that the values of goods have not been correctly declared and that the goods have been overvalued for the purpose of claiming higher DEPB benefit.

33. For the above reason, I concur with the order proposed by learned  Member (Judicial).

34. The file is now returned to the original Bench for passing the majority order.

FINAL ORDER

35. In view of the majority decision, the impugned order is set aside and all the appeals are allowed with consequential relief.