ORDER
S.S. Kang, Vice-President
1. The appellant filed this appeal against the adjudication order passed by the Commissioner of Customs.
2. The brief facts of the case are that the appellant made two imports of integrated circuits and transistors. The value declared by the appellant in respect of integrated circuits viz. 1C LA 4440 and ICLA 4445, IC 4440 and IC 4445 was not accepted by the Revenue and the assessing authority enhanced the value. On the enhanced value the assessment was made and appellant paid duty and got cleared the good. The import was made in the year 1988 and thereafter a show-cause notice was issued on 21-6-2000 on the ground that appellant suppressed the value of the imported goods and after relying upon the contemporaneous imports, the adjudicating authority enhanced the value of the goods as proposed in the show cause notice and imposed penalties. The appellants are not challenging the first enhancement in respect of value of the goods imported by them on which duty has been paid. The appellant challenging the second enhancement and imposition of penalties.
3. The contention of the appellant is that the Revenue on the basis of a letter issued by the Directorate of Valuation dated 22-5-98 enhanced the value of integrated circuits. The contentions is that this value was accepted by the appellant and duty was paid accordingly. Show-cause notice was issued on the basis of subsequent letter written by the Directorate of Valuation dated 19-6-98 where it is mentioned that as per the information obtained in respect of integrated circuits from the customs authorities it was found there is no uniformity in assessment practice of this item and the different value are being accepted by different Custom Houses. The contentions is that in the show-cause notice 14 instances different bills of entry were relied upon by the Revenue for assessing the value of goods imported by the appellant. The contention is that out of these 14 Bills of Entry only 4 bills of Entry are relevant because these are in respect of goods imported by the appellant. The country of origin in respect of goods imported by the appellant is Hong Kong and Singapore and whereas the Bills of Entry which are mentioned in the Show-cause notice, the country of origin is Japan, therefore, the value of the goods which are manufactured in Japan cannot be made basis for the value of the goods originating from Hong Kong and Singapore. The contentions is that once the value of the goods declared by the appellant is not accepted by the Revenue and the value was enhanced on the basis of letter issued by Directorate of Valuation in which the instance of import of same goods at Madras was cited and value was enhanced on the basis of that import, therefore, the predetermination of the Value second time is not sustainable the appellant also submitted that as per the valuation Rule of 3, 5, 6 that, if there is more than one transaction value of identical goods is available the lowest of such value has to be taken for determination of the value of the imported goods. The appellant also produced the data supplied by the Directorate of Valuation which shows that the goods in requesting are being imported at widely varying prices, therefore, in this situation, the lowest value is to be taken into consideration which is almost at par with the value declared by them. The contention of the appellant is also that in the first Bill of Entry, the goods imported by them are IC LA 4508, 4440, 4445 whereas in the second import it was only ICs of the same numbers and these are not integrated LA, therefore, the enhancement of the goods which are imported, the second Bill of Entry cannot be enhanced on the basis of the value determined in respect of IC LA which were imported under the first Bill of Entry.
3. The contention is also that in respect of the transistors, the Revenue obtained a quotation from M/s. Electromark, Bombay, the appellant specifically made queries from M/s. Electromark, Bombay where they denied that the quotations relied upon by the Revenue are not given by them. The contention is that this fact is noted by the adjudicating authority in the impugned order. The appellant also relied upon the decision of the Tribunal in the case of Parag Sheth v. CC reported in 2005 (70) RLT 281 whereby the quotations by M/s. Electromark, Bombay were not accepted for enhancement of the value of similar imported goods. The contention is that in these circumstances, the enhancement of value of the imported goods is not sustainable.
4. The contentions of the Revenue is that the value of imported goods declared by the appellant in respect of the imported goods is not accepted by the Revenue and it was enhanced and assessment was made on the basis of that enhanced value subsequently it was found that goods were imported during the same time by other importers even on higher price. Therefore, show-cause notice was issued to the appellant for enhancement of the value of the goods on the basis of import made by other importers. The contention is that in case of suppression Revenue can issue a show-cause notice for recovery of the duty short paid within five years. The contention is also that the value was enhanced on the basis of same goods imported by other importers.
5. In this case, the value of the goods imported by the appellants were enhanced first time by the Revenue and that enhancement was not questioned by the appellant and duty was paid. Subsequently, a show-cause notice was issued referring 14 instances of import made by other importers of the same goods on higher value. We find that out of this 14 instances mentioned in the show-cause notice only 4 Bills of Entry are relevant to the goods imported by the appellant and we find that the country of origin in the instances relied upon by the Revenue is different than the goods imported by the appellant. The country of origin of the goods imported by the appellant is Singapore and Hong Kong whereas the country of origin of the goods mentioned in the show-cause notice relied upon by the Revenue is Japan. Further we find that the first determination of the value was based on the letter issued by the Directorate of Valuation, the directorate of Valuation again issued a letter dated 19-6-98 where it has been pointed out in respect of Integrated Circuit there is no uniformity in the assessment practice of this item and that different values are being accepted by different Customs Houses and it is also pointed out that where the parameters like the country of origin, part number, quantity, commercial level, timing of import etc. are identical or comparable, the assessable values differ significantly. The statement along with this letter shows that the ICs which are imported by the appellant are being imported into India declaring different prices, if we go by the Valuation Rules than the lowest value is to be taken for the purposes for assessment. In respect of the transistor, the revenue want to rely upon quotation issued by M/s. Electro-mark, it is settled law that value of the goods cannot be enhanced on the basis of quotation. Further on query made by the appellant M/s. Electromark denied the issuance of the quotations which was relied upon by the Revenue. Another instance is relied upon by the Revenue for enhancing value of transistors is imported by N. K. Overseas vide bill of entry dated 11-9-98. We find that the Tribunal in the case of Parag Sheth (supra) where the Revenue relied upon the same bill of Entry for enhancing the value of the goods imported by Parag Sheth set aside the order whereby the value was enhanced on the basis of import of Ms N.K. Overseas. In these circumstances, we find that the enhancement of the value of the imported goods second time by issuing a show cause notice is not sustainable hence set aside. Consequently, penalties are also set aside and the appeal is allowed. The cross-objections filed by the Revenue which are simply in support of the adjudication order are dismissed.
(Dictated and pronounced in open Court on 14-10-2005)