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2005 (182) E.L.T. 49 (Tri. - Mumbai)
IN THE CESTAT, WEST ZONAL BENCH, MUMBAI
Smt. Archana Wadhwa, Member (J) and Shri S.S. Sekhon, Member (T)
ASTRA DIAMONDS TOOLS PVT. LTD.
COMMISSIONER OF CUSTOMS, MUMBAI
Order Nos. A/20-21/2005-WZB/C-II, dated 31-12-2004 in Appeal Nos. C/975/2002 & 152/2003
Valuation (Customs) - Undervaluation - Two sets of invoices for same transaction recovered from premises of indentor - Second invoice having remarks showing recovery of differential compensation from deposits made by importer - Markings on invoices and goods identical - Nothing on record to reflect upon factum of enmity either on part of indenting agent or any other person - Telex message sent by said indenter showing an attempt to cover up any leakage of truth by supplier - Finding of under-valuation based upon sufficient evidence available on record - Section 14 of Customs Act, 1962. - The Revenue having produced the two sets of invoices for the same goods and the remarks showing recovery of differential compensation has sufficiently discharged the onus placed upon it. It was now for the appellants to clarify the existence of two different invoices for the same transaction. [paras 7, 8]
REPRESENTED BY : Shri Nitin Vatkar, Advocate, for the Appellant.
Shri R. Pardeshi, JDR, for the Respondent.
[Order per : Archana Wadhwa, Member (J)]. - Vide his impugned order, the Collector of Customs, Bombay, has enhanced the value of Natural Graphite imported in the year 1988 from the declared value of Rs. 1,12,737/- CIF to Rs. 3,19,974/-. He has also confiscated the goods on the ground of intentional under-valuation of the goods, with an option to the appellants to redeem the same on payment of redemption fine of Rs. 3 lakhs. Penalty of Rs. 75,000/- is imposed upon the 2nd appellant Shri D.A. Kamath of M/s. Astra Diamond Tools Ltd.
2.The dispute in the present case relates to the under-valuation of the Natural Graphite. The appellants declared the value of the same as US $ 7462.70. As a result of information received from the Enforcement Directorate, Bombay, about the interception of second sets of invoice relating to the import of Natural Graphite by the appellants, further investigations were conducted by the Customs Air Cargo. The business premises of M/s. Shimnit Enterprises were put to search, which resulted in recovery of two invoices, one meant for the bank and Customs Office was for the value of US $ 7162.70 and another invoice with the same invoice number was for value of US $ 21,322. The second invoice also mentioned that the differential amount of US $ 13,859.30 had been drawn by the exporter in Japan from the deposit of importer/indenter.
3.As a result of the above development, the relevant bill of entry was called back and the statement of Shri D.A. Kamath, Managing Director of M/s. Astra Diamond Tools and of Shri Nitin Shah of M/s. Shimnit Enterprises, the indenter were recorded. Subsequently, DRI Bombay also intercepted and forwarded a copy of telex message seized by them from the office premises of M/s. Shimnit Enterprises, Bombay.
4.Based upon the above evidences, show cause notice dated 15-6-1988 was issued to the importer as also to the indenter proposing enhancement of the assessable value of the goods as also for imposition of penalty and confiscation of the goods. The said show cause notice culminated into the impugned order passed by the Commissioner. Hence, the present appeal.
5.Shri Nitin Vatkar, ld. Advocate appearing for the appellants has strongly argued that the entire case of the revenue is based upon the recovery of the two invoices from the business premises of the indenter and the telex message sent by the said indenter, nothing has been recovered from the premises of Shri Kamath and the chit recovered requesting one Shri Qasim to advise the suppliers not to discuss regarding deposit amount, etc. with Indian High Commission, Tokyo, does not link up the importation in question. It was argued that the charge of under-valuation being a serious charge is required to be proved by the Revenue beyond doubt and no adverse finding can be arrived at against the importer on the basis of the recoveries made from the premises of their indenter.
6.Shri Pardeshi, ld. JDR appearing for the Revenue, countered arguments of the ld. Advocate by submitting that there is ample evidences in the shape of two different invoices for the same importation and the statements on one of the invoices to the effect that the differential price has been recovered by the exporter from the deposits made by the importer. The markings on the invoices and the goods were identical, thus linking the invoices with the imported goods. Ld. JDR submits that the entire evidence has been discussed by the Commissioner in his impugned order and prays for upholding the same.
7.We have considered the submissions made by both sides. The rough graphite is imported by Astra Diamond Tools under Invoice No. 8802/0022, dated 10-2-1988 showing the price as US $ 7533.57 FOB. The second invoice recovered by the Revenue bears the same number 8802/0022 and is dated 12-2-1988. It is for the same number of graphite pieces but the FOB value has been shown as US $ 21322. The remarks appearing at the bottom of the said invoice read as under :-
“Please be advised that the amount US $ 13,859.30 has been drawn from your deposit. US $ 21,322 ´ 0.65 = US $ 13859.30 (TTL amount shipped ´ 656”
The above fact clearly shows that the importer got issued two different invoices for the same goods from their exporters. The exact difference between the two invoices comes to US $ 13,855.30. The remark on the second invoice clearly reflects the said difference in consideration has been drawn from the deposits made by the importer. We do not agree with the contention of the ld. Advocate that Revenue has not been able to show the presence of any bank account, etc. by the importer in Japan. The Revenue having produced the two sets of invoices for the same goods and the remarks showing recovery of differential compensation has sufficiently discharged the onus placed upon it. It was now for the appellants to clarify the existence of two different invoices for the same transaction.
8.We also do not find any favour with the appellant’s arguments that two sets of invoices were prepared by their indenting agent or somebody else having enmity with them. There is nothing on record to reflect upon the factum of enmity either on the part of the indenting agent or on any other person. It is also seen that the telex message intercepted by DRI and sent from the office premises of Shimnit Enterprises reads as under :-
“ATTN – QASIM PLS ADVICE TOYO TANSO IF INDIAN HIGH COMMN TOKYO CONTACT THEM DO NOT DISCLOSE ANYTHING I.E. DEPOSIT A/C, PRICE LIST, ANY SHIPMENT ON THE WAY ETC. I AM UNDER LOT OF TENSIN. TKS. RGDS – NTTIN’.”
There is no explanation coming forth from the appellants as regards the above telex message. In these circumstances, we are of the firm view that the conclusion arrived at by the Commissioner as regards under-valuation of the goods is based upon sufficient evidence available on record and his findings that there has been an attempt to cover up any leakage of the truth by the supplier are required to be sustained.
9.In these circumstances, we find no merit in the appeals filed by the appellants, the same are accordingly rejected.