LexM/S COMMERCE INTERNATIONAL versus COLLECTOR OF CUSTOMS
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MIS COMMERCE INTERNATIONAL
A
v.
COLLECTOR OF CUSTOMS
MARCH 29, 1995
[R.M. SAHA! AND S.C. SEN, JJ.]
B
Customs Valuation Rules: Rule 3( a)(b ).
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Import of toners-Custom clearance fo,-{)ec/aration of value-Non-
submission of price list by importer-Reliance by Customs on price list c
obtained from manufacture,-{)etermination of value under Rule 3(a)-Held
valid.
The appellant imported 125 cartons of toners and filed a bill of entry
for their clearance declaring their value on the basis of invoice-cum-value
and country of origin certificate Issued by the trading company. It did not D
file the price list of goods imported as asked by the Department, stating
that the trading company was not willing to reveal the source of supply.
Constquently, the Customs Department obtained the price list from
'
manufacturer and relying upon the same determined the value of goods
under Rule 3(b) of Customs Valuation Rules holding that It was a case in
which rule 3(a) could not be applied. On appeal the Tribunal upheld the E
valuation made under Rule 3(b). Hence this appeal by the importer.
Dismissing the appeal, this Court
HELD: The determination under rule 3(b) of the Customs Valuation
Rules could be undertaken if the valuation could not be determined under F
clause(a). The authorities found that In the nature of goods Imported by
the appellant the valuation of It could not be determined under rule 3(a).
Therefore, rule 3(b) was rightly Invoked. The determination having been
done .on comparable goods offered for sale .in competitive conditions In
countries outside India the order does not suffer from a1_1y error of law.
G
[71-B)
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2198 of
1988.
J
From the Judgment and Order dated 11.5.88 Central Excise and
Customs and Gold {Control) Appellate Tribunal, New Delhi in A.No. H
69
70
SUPREME COURT REPORTS
(1995) 3 S.C.R.
A C.3088/87-A
B
c
Rajiv Dutta and Vipin Nair for the Appellants.
Dr. R.R. Mishra, R.B. Mishra for P. Parmeswaran with him' for the
Respondent.
The following Order of the Court was delivered :
The only question that arises for consideration in this appeal is
whether the Tribunal was justified in applying Rule 3(b) of the Customs
Valuation Rules framed under Section 14 of the Customs Act.
The appellant filed a Bill of Entry for clearance of 125 cartons of
toners declaring the value of the goods at a particular amount on the basis
of invoice-cum-value and country of ongin certificate issued by M/s. Sangill
Ltd. Since the seller was not a manufacturer the Department required the
D appellant to furnish the price list of the goods under import but the
appellant instead of filing the price list stated that they had purchased the
goods from a trading company which was not willing to reveal the sol!rce
of supply. Consequently, the Department obtained export price list from
M/s. Coates Electrographics Limited. After examining the price list of Mis
Coates Electrographics Ltd., the Collector was of the opinion that it was
E a case in which rule 3(a) could not be applied. Therefore, he proceeded
to determine the value under rule 3(b) and on the price list supplied by
the manufacturer the valuation of the toner imported by the appellant was
determined. It was held that the value of the goods when compared with
manufacturer's price list was much below the nonnal price in the interna-
F tional market. The goods were directed to be confiscated with an option
to clear on Rs. 8 lakhs. Penalty of Rs. 1000 was also imposed. Against this
order the appellant approached the Tribunal. The Tnbunal found that the
Collector did not commit any error in applying rule 3(b) but reduced the
redemption fine from Rs. 8 lakhs to Rs. 5 lakhs. The penalty of Rs. 1,000
was maintained.
G
Section 14(1)(b) of the Customs Act empowers the appropriate
authority to determine the value of the imported goods in accordance with
provisions contained in rules 3 to 8. Rule 3(a) provides for determination
of value of such goods, with comparable goods produced or manufactured
H and ordinarily sold or offered for sale to other buyers in India under
)-
),.
COMMERCE INTERNATIONAL v. COLLECTOR OF CUSTOMS
71
competitive conditions. Rule 3(b) permits the proper officer to determine A
valuation on the export price at which such goods or comparable goods
are ordinarily sold or offered for sale under competitive conditions to
huyers outside IExcerpt shown. Read the full judgment & AI analysis in Lexace.