@JUDGMENTTAG-ORDER
P. Jyothimani, J.@mdashThese writ petitions relate to the import of raw silk by the Petitioners through Chennai Portfrom various places of Origins, namely, Uzbekistan, China and Vietnam. Out of these writ petitions,W.P. Nos. 27719, 27720, 28395 and 28452 of 2010 are relating to import of raw silk from Uzbekistan,W.P. No. 28009 of 2010 is relating to import of raw silk from China and W.P. Nos. 28010 and 28451 of 2010are relating to Vietnam origin.
2. These writ petitions are filed for a direction against the Respondents to hold that thecontracted value, covered under various contracts, payable and paid to the supplier of the importedgoods is the transaction value, as defined u/s 14(i) of the Customs Act, as amended by theNotification dated 10.09.2007, which has come into effect from 10.10.2007.
3. It is admitted that all the commodities have reached Chennai Port. In respect of the importof raw silk from Uzbekistan regarding the Petitioner in W.P. No. 27719 of 2010, it has been stated thatearlier the goods were cleared by the Respondents by accepting the bill of entry declaring the valueat 14.10 US $ per kg. However, in respect of the above said writ petition, when the contracted pricearrived at in the said writ petition was at 13.75 US $ per kg, the bill of entry has not been clearedand kept pending.
4. Likewise, in respect of the Petitioner in W.P. No. 27720 of 2010, earlier the goods werecleared on the bill of entry declaring the value at 15.50 US $, 15.30 US $ and 15.50 US $ per kg; butwhen the contract price was stated as 15.30 US $ per kg, the bill of entry is kept pending withoutclearance. In respect of the writ Petitioner in W.P. No. 28010 of 2010 which relates to Vietnam Origin,earlier for the same price of 21.00 US $ per kg. three consignments were cleared and when the contractprice of 21.00 US $ per kg was stated in respect of the writ petition, the bill of entry is keptpending on the ground that there has been a difference in price stating that it is at 25.00 US $ perkg. Similarly, in respect of the goods of China origin regarding the Petitioner in W.P. No. 28009 of2010, when earlier the consignments were quoted at 30.00 US $ per kg, the bill of entry is kept pending without clearance on the ground that the value is in some cases 28.50 US $ or 35.00 US $ perkg.
5. With regard to the Petitioners in W.P. No. 28395 and 28452 of 2010, though the Petitionershave filed bills of entry declaring the value at 15.00 US $ per kg and 15.50 US $ per kg respectively,the Respondents did not assess the bill of entry in both the cases and the same are pending. Similarly, the Petitioner in W.P. No. 28451 of 2010, relating to the import of ''thrown silk yarn'' fromVietnam origin, filed the bill of entry declaring the price at US $ 21.35 per kg., the 2nd Respondenthad not taken any action to assess and release the imported goods.
6. On analysis of the entire facts stated above, it shows that the bills of entry are keptpending with the Customs Department without clearance on the ground that between the admittedcontractual value which is stated to have been payable or paid by the Petitioners with the foreignimporters and the different prices which are arrived at by the Department, there has been variation. Under such circumstances, the present writ petitions have been filed by the Petitioners on the groundthat as per the amendment of Section 14(i) of the Customs Act by Notification dated 10.09.2007, whichhas come into effect from 10.10.2007, the valuation of imported and export goods has to be taken onthe transaction value, which is stated to be either the price actually paid or payable. This is incontrast to the earlier provisions before the amendment, wherein the value of the goods was deemed tobe the price at which such goods are ordinarily sold or offered for sale. As per the amended section 14(i), after the said Notification, which has come into effect from 10.10.2007, the clause stands asfollows:
14. Valuation of goods:(1) For the purposes of the Customs Tariff Act, 1975 (51 of1975), or any other law for the time being in force, the value of the imported goods and exportgoods shall be the transaction value of such goods, that is to say, the price actually paid orpayable for the goods when sold for export to India for delivery at the time and place ofimportation, or as the case may be, for export from India for delivery at the time and place ofexportation, where the buyer and seller of the goods are not related and price is the soleconsideration for the sale subject to such other conditions as may be specified in the rulesmade in this behalf:
Provided that such transaction value in the case of imported goods shall include, in addition to the price as aforesaid, any amount paid or payable for costsand services, including commissions and brokerage, engineering, design work, royaltiesand licence fees costs of transportation to the place of importation, insuranceloading, unloading and handling charges to the extent and in the manner specified inthe rules made in this behalf:
Provided further that the rules made in this behalf may provide for
(i) the circumstances in which the buyer and the seller shall be deemed to berelated;
(ii) the manner of determination of value in respect of goods when there is nosale, or the buyer and the seller are related, or price is not the sole considerationfor the sale or in any other case;
(iii) the manner of acceptance or rejection of value declared by the importeror exporter, as the case may be where the proper officer has reason to doubt the truthor accuracy of such value, and determination of value for the purposes of this section:
Provided also that such price shall be calculated with reference to the rate ofexchange as in force on the date on which a bill of entry is presented u/s 46, or a shipping bill of export, as the case may be, is presented u/s 50.
7. It is also relevant at this stage to refer to Section 14(i), which stood before theamendment of the Customs Act, 1962, as follows:
14. Valuation of goods for purposes of assessment:(1) For the purposes of theCustoms Tariff Act, 1975 (51 of 1975), or any other law for the time being in forcewhereunder a duty of customs is chargeable on any goods by reference to their value, thevalue of such goods shall be deemed to be the price at which such or like goods areordinarily sold, or offered for sale, for delivery at the time and place of importation orexportation, as the case may be, in the course of international trade, where the seller andthe buyer have no interest in the business of each other and the price is the soldconsideration for the sale or offer for sale:
Provided that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented u/s 46, or a shipping bill or bill of export, as the case may be, is presented u/s 50;
8. It was, by considering the unamended provision u/s 14(i) of the said Act, thejudgment was delivered by the Hon''ble Apex Court in
9. Considering the fact that these are the commodities which are imported and awaitingclearance in the Chennai Port and taking note of the fact that the Petitioners are the regularimporters, the valuation of which is admittedly fluctuating everyday, I am of the view that pendingcompletion of the adjudication process, certain workable solution has to be made for the purpose ofrelease of the goods.
10. Mr. Udhayakumar, learned Senior Central Government Standing Counsel submits that, onreleasing of the goods even subject to any condition, the adjudication becomes practically impossiblesince the Petitioners fail to produce documents and appear for enquiry after the goods are releasedand it is not possible for the Department to trace the persons for the purpose of completing theadjudication process that may result in huge revenue loss to the State. On the other hand,Mr.K. Jayachandran, the learned Counsel appearing for the Petitioners would submit that the Petitionersare always ready to co-operate with the adjudication process and they are willing to abide by theconditions like the personal bond, etc., so as to bind themselves for early disposal of theadjudication process.
11. Considering the abovesaid facts and circumstances, I am of the considered view that theRespondents shall release the goods concerned subject to the following conditions:
(1) The Petitioners shall pay the entire amount of duty as per the declared valuewhich may be based on the contract or price etc., as per the provisions of the Customs Act,forthwith to the Department.
(2) In addition to that, the Petitioners shall provide sufficient bank guarantee to the satisfaction of the Respondents drawn on any Nationalised bank in respect of 50% of thedifference in duty in favour of the Department, to be kept alive till the adjudicationprocess is completed.
(3) In respect of the remaining 50% of the difference in duty, the Petitioners shallfurnish personal bond to the satisfaction of the Respondents. On completion of all the threeconditions, the Respondent shall release the goods.
(4) On release of the said goods after completion of the said conditions, theRespondents shall complete the adjudication process within a period of four weeks thereafterby giving a necessary show cause notice. It is made clear that on furnishing of necessaryshow cause notice, the Petitioners shall submit their objection, appear before theRespondents and co-operate with the Department in the adjudication process.
With the above observations, all the writ petitions stand disposed of. No costs. Consequently, connected M.Ps. are closed.
