S.S. Sekhon, Member (Technical)

1. Heard the Ld. DR in this appeal filled by Revenue. The respondents are absent. Since the issue involved is covered by the valuation rules itself, the appeal is taken up for decision.

2. The respondents had imported a consignment of pickers declaring the value at 1.48 Swiss Francs per piece which was accepted by the Customs and goods allowed to be cleared. Out of the 1800 pickers in the said consignment, it was found that the quantity of 1118 pickers were of different sizes and hence those 1118 pickers were returned by the manufacturer. Full details of returned pickers with references to the original B/E and invoice were given and endorsements by the Customs were also obtained and they were tallying with the documents. Consequently, the Swiss manufacturers sent equal quantity of pickers as free replacement but issued an invoice for Customs purpose showing the price at 1.48 Franks per picker. That was not taken up as transaction value since it was found that M/s. Bharat Vijay Mills had obtained pickers at 5.20 Swiss Franks per piece for a quantity of 30 pieces imported by them.

3. The Commissioner (Appeals) found that it was a settled legal position that only when the import was in substantially the same quantity that they can be considered as contemporaneous imports at the same level for the goods under valuation under Rule 5 of the Valuation Rules applicable to imported goods. Since the goods were not in substantially similar quantity, the value for import of 30 pickers by M/s. Bharat Vijay Mills were not considered to be applicable for 1118 pickers imported as replacements and he passed an order in favour of the importers.

4. Hence this appeal. The ground taken by the Revenue are :

i) The invoice issued was for Custom purpose and there was thus an intentional mis-declaration of value of the goods.

ii) Goods have been sent in January 1999 and the contemporaneous price of the goods prevailing on January 1999 has to be accepted.

iii) The items as replacement covered under B/E No. 229 dt. 16.01.1999 not acceptable as the identity between the re-exported items and the items covered under B/E No. 229 dt. 16.01.1999 could not be established. Therefore, the declared value of 1.48 Swiss Francs per piece has to be rejected and value of 5.20 Swiss Francs per piece has to be applied.

5. After considering that the goods are replacements and they are endorsements made and considering the notes of the Customs Valuation Rules 1998, for Rule 5, being applied in this case, it is found that it is imperative that the price for sale of identical goods at the same commercial level and substantially the same quantity as the goods being valued are required to be compared along with the adjustments for quantity commercial level factors. The question of quantity discounts cannot be ignored. No such material exists. The import of 30 pickers in a consignment of M/s. Bharat Vijay Mills cannot be considered to be at the same commercial level and substantially the same quantity as 1118 pieces of pickers being sent as replacements in pursuance of performance for the contract of sale of 1800 pickers. Thus, the value enhancement proposal of Revenue cannot be upheld. The grounds taken by the Revenue did not enthuse us to raise the value of the present imports.

6. Consequently, Revenues appeal, found bereft of valid grounds, is therefore dismissed.

Pronounced in Court)