ORDER
T.P. Nambiar, Member (J)
1. This is an appeal filed by the appellant against the orders passed by the Collector in Order No. SB/36/94 SIB dated 28-4-1994. In terms of that order he held that the unit price of Methoxy-Hydroxy Benzaideliyde (Vanillin) imported by the appellants in terms of Bill of Entry No. 31105 dated 7-10-1991 is US $ 11.25 per kg. He ordered confiscation of the same and allowed the appellant to redeem the same on payment of redemption fine of Rs. 3.00 lakhs and imposed penalty of Rs. 1.00 lakh.
2. This order was passed by the adjudicating authority in terms of the remand order passed by the Tribunal, Special Bench ‘A’, New Delhi vide order No. 392/93-A, dated 20-8-1993.
3. This case pertains to the import of 8165 kgs. of Vanillin from Hong Kong against REP licence by the appellant. The appellant contended originally that the purity of the goods was less than 10 to 15% and hence the price was less. But the test report revealed that the impugned goods were pure Vanillin.
4. The appellant had declared over price and show cause notice was issued as to why the price should not be [fixed] at US $ 12.50 per kg. In the first order the Collector fixed the price at US $ 12.50 per kg. which was taken up in appeal before the Tribunal. While remanding the case the Tribunal in Para 6 observed as follows :
“Though the ld. Advocate for the appellant has pleaded that the burden would lie on the Department alleging undervaluation, to prove the same, the ld. SDR, has rightly refuted the same by submitting that, these were all the facts within the special knowledge of the appellants, and it was for them to adduce conclusive evidence, as, by pleading special grounds for the lower value, the appellants have virtually accepted that but for these special circumstances, the value would have been higher. As is rightly submitted by the ld. SDR, with the plea as is raised by the appellants, the burden cast on the Department to establish undervaluation is duly discharged by the licit admission thereof by the appellants and it was for the appellants then to prove the specific plea raised for lower valuation of the subject goods. The legal position is well settled, by insertion of the provision in the statute book, namely Section 106 of the Evidence Act, as also by series of judicial pronouncements that the fact within the special knowledge of the party has to be proved by the party, alleging the existence of the same. Here however, that is not done. As to the shifting of burden of proof, the Supreme Court has already laid down guidelines, in respect thereof, in cases under the Customs Act, vide Collector of Customs v. D. Bhoormal – 1985 ECR 2284 (S.C) and the same is in confirmity with what the ld. SDR has pleaded.”.
Accordingly the impugned order was passed after granting personal hearing to the appellant.
5. The learned Consultant appearing for the appellant contended before us that the impugned order is contrary to the law laid down by several decisions of the Tribunal. He pointed out that the goods imported by the appellant are of inferior variety. In respect of quotation dated 15-11-1991 it was pleaded that the same does not contain the details of the quantity offered and that the goods covered by which are of Chinese origin and the supplier is Hong Kong based trader and therefore the price will only be higher as it would include the transport charges, intermediary’s margin and other incidental charges. It was also stated that the quotation application states the price to be about US $ 12.50 indicating the possibility of further negotiations. In regard to the quotation dated 30-10-1991 he submitted that the recipients of the quotation is one Mayur Enterprises, Bombay which is not in existence. In this regard the learned SDR pointed out that this quotation dated 30-11-1991 was rejected by the Collector (Appeals) in the impugned order stating that the same is not an acceptable evidence.
6. Therefore the question to be decided is whether the value can be determined on the basis of the quotation dated 15-11-1991. The plea of the appellant is that this quotation is from a trader and the price would include the transportation cost, intermediary’s margin and other incidental costs. But the same is not relevant in view of the fact that this import made by the appellant is also from a trader from Hong Kong and not from the manufacturer. The other point raised is in this quotation dated 15-11-1991 a reference is made with respect to the letter dated 14-11-1991. But actually this reference was made on 13-11-1991. But that will not alter the reliability of the quotation dated 15-11-1991 which can only be termed as an arithmetical mistake. But it was pointed out that the quotation is not an evidence which can be taken note of for enchancing the value. In this connection the learned adjudicating authority has relied on the decision of the Hon’ble Supreme Court in the case of M/s. Sharp Business Machines reported in 1990 (49) E.L.T. 640 wherein the assessable value was determined on the basis of quotations. This plea also therefore cannot be upheld.
7. The contrary view of the Department was that the price range of similar goods is at US $ 13.8 to 15 per kg. and this price quoted in the quotation of US $ 12.8 per kg. therefore broadly tallies with the abovesaid price.
8. But it was contended by the learned Consultant that the importer of the origin of the goods are to be ascertained and the burden is on the Department.
9. But in this regard in the remand order itself the Tribunal has mentioned that this fact is specially within the knowledge of the appellant and it was for them to prove the same in terms of Section 106 of the Indian Evidence Act. The Tribunal in that remand order in this connection held as follows :
“The fact within the special knowledge of the party has to be proved by the party alleging the existence of the sale.”.
10. This observation of the Tribunal was noted by the adjudicating authority in Para 4.11. It was also held that about the country of origin it is for the appellant to prove the same in terms of the remand order.
11. It is further pointed out that in the computer prints the price range from US $ 13.8 to 15 per kg. and these imports were all made from different countries like China, Norway, USA etc. In this regard we find that in terms of Rule 8 of the Valuation Rules, the adjudicating authority can determine the value after giving the suitable allowance. All these factors were taken into cosideration by the adjudicating authority and at Para 4.13 after taking note of all these submissions he held as follows :-
“Accordingly, in terms of Rule 8 of Valuation Rule, the value of the impugned goods can be determined after giving suitable allowance over the aforesaid price of US $ 12.5/kg contained in the quotation dated 15-11-1991 inasmuch as the said quotation does not specify US $ 12.5 as the exact price, but only as a negotiable price by stating “about US $ 12.5/kg”. Further, also keeping in mind the price at which such goods have been imported as seen from the computer printout, I feel it could be appropriate to give a discount of 10% on the aforementioned price of US $ 12.5/kg, to take into account variation in commercial levels of import, negotiability, etc. Accordingly, the price of the impugned goods can be determined at US $ 11.25/kg (C & 1).”.
It is therefore clear that he has clearly applied his mind in determining the value of the goods in terms of Rule 8 of the Valuation Rule and we find no ground to interfere with the same. Therefore the total value of the import exceeds the value of licence by Rs. 21,12,469/-. The licence produced by the appellant therefore did not cover these goods of the abovesaid value and the adjudicating authority has rightly held that the goods of the above value are liable for confiscation under Section lll(d) and lll(m) of the Customs Act, 1962. The redemption fine of Rs. 3,00,000/- works out to about 15% and cannot be said to be in any way excessive. However in the facts and circumstances of the case the penalty imposed on the appellant is reduced to Rs. 50,000/- (fifty thousand). But for the above modification the appeal is otherwise dismissed.