ORDER
S.L. Peeran, Member (J)
1. This appeal arises from OIO No. 20/2001, dated 10-9-2001 passed by Commissioner of Customs enhancing the value of imported goods declared as Watch Parts to the extent of the numbers indicated in the BE. The Department has also proceeded to search the premises of the appellants and had recovered 465 Nos. of Metal Bezels, 560 Nos. of Straps, 400 Nos. of Metal Bezels and 400 nos. of Metal back covers. They were seized under Mahazar dated 22-11-2000 on the belief that these Watch Parts were also undervalued in respect of earlier imports declared in BE 196641 dated 28-10-2000. In order to prove the undervaluation, the Department has relied on the value ascertained from HMT, Bangalore. This has been challenged on the ground that HMT, Bangalore cannot value the goods, which are imported from Hong Kong, on their own basis, which is not the method to be adopted for enhancing the value in terms of the Customs Act, Rules and Valuation Rules.
2. It is the contention of the learned Counsel that the transaction value has not been challenged by producing any evidence of contemporaneous import during the same time and place and as such enhancing the value on the basis of getting an estimate done through M/s. HMT, Bangalore is contrary to the Customs Act and Rules and is not in terms of the judgments laid down by the Apex Court as in the case of Collector of Customs, Bombay v. Nippon Bearings (P) Ltd. -1996 (82) E.L.T. 3 (S.C.); Leela Dhar Maheshwari v. CC (Import), Mumbai – 2001 (132) E.L.T. 207 (Tri.-Mumbai) or even the Board’s Circular issued with regard to the revision of valuation.
3. The learned Counsel also relied on the judgment of the Tribunal rendered in the case of Sources India Impex Pvt. Ltd. v. CC, New Delhi [2002 (140) E.L.T. 229 (Tri.) = 2001 (47) RLT 1005 (CEGAT-Del.)]. He attacked the confiscation of goods, which are already been cleared in 2002, and enhancing its value ipse dixit basis. He submitted that this is also not covered by law as once the goods have been cleared for home consumption, then they ceased to be open for assessment and in this regard, relied on the Tribunal ruling rendered in the case of Kishandas & Sons v. CC, Mumbai – 1999 (112) E.L.T. 227 (Tribunal) and that of the Bombay High Court judgment rendered in the case of Bussa Overseas & Properties P. Ltd. v. C.L Mahar, Asst. CC, Bombay – wherein it has been clearly held in para 7 that once the goods covered by consignment are cleared for home consumption, then they ceased to be imported goods as defined in Section 2 of the Customs Act, 1962 and consequently not liable to confiscation. It has been held that power to confiscate thereafter can be exercised only in cases where the order of clearance is revised and cancelled.
4. The learned Counsel also files a memo showing the particulars of the manufacturer’s price, declared price and the HMT’s price. He pointed out that the HMT had given the valuation on the basis of their own assessments without examination of the goods. He submitted that the imported goods were different and were “without hands” while the assessment of HMT was on the basis that the items were “with hands”. He submitted that the procedure adopted by the Commissioner to enhance the value is not as per law and requires to be set aside.
5. The learned SDR reiterated the findings given by the Commissioner.
6. On a careful consideration, we find that the department had examined the goods which were Watch Parts on the filing of BE dated 18-11-2000. It also resulted in search of the appellant’s premises and seizure of the earlier goods which were cleared vide BE dated 28-10-2000. The Show Cause Notice was provided to enhance the value on the basis of the samples drawn and value obtained from HMT, Bangalore. The procedure has been challenged on the ground that the HMT cannot value the goods and they are not the authorized persons to enhance and give a higher value without any basis. The valuation has to be enhanced only on the basis of evidence of contemporaneous import of goods at the same time, place and the same nature of goods. In the present case, there is no evidence produced by Revenue to enhance the value. The procedure adopted by Revenue to send samples to HMT for valuing the watch parts imported by the importer is not known to the Customs Act, Rules and Valuation Rules. Therefore, the appellants are justified in attacking the new procedure adopted by the Commissioner in enhancing the value on the basis of the Certificate of Valuation furnished by M/s. HMT, Bangalore. M/s. HMT, Bangalore may be manufacturing the Indian goods but they are not the importers and it is not the case of the HMT that they have imported like goods during the same time and place at a higher value. Moreover, the HMT has given the value on the basis of watch parts having ‘hands’ while in the instant case, the watch parts does not have ‘hands’. Furthermore, Revenue cannot confiscate the goods which have already been cleared for home consumption as they ceased to be imported goods as defined in Section 2 of the Customs Act and as held by the Bombay High Court in the case of Bussa Overseas & Properties P. Ltd. (cited supra). The same view has been expressed by the Tribunal in the case of Kishandas & Sons; Sources India Impex P. Ltd. and in the case of Leela Dhar Maheswari v. CCE. The burden to prove to show the goods were undervalued is on the Revenue, which has not been discharged in the present case, and, therefore, the Supreme Court judgment rendered in the case of CC, Bombay v. Nippon Bearings (P) Ltd. (cited supra), also comes to the support of the appellants. We are not in agreement with the procedure adopted by the Revenue to enhance the valuation on the basis of the prices shown by M/s. HMT, Bangalore who have not imported similar goods from the same supplier and at the same time and place. There is no evidence to show that there is undervaluation in the matter and goods imported during the earlier occasion is liable for confiscation also. Therefore, both the appeals are allowed by setting aside the impugned order which is not legal and proper.
(Operative portion of this Order was pronounced in open Court on conclusion of hearing)