COMMISSIONER OF CUSTOMS (GEN), MUMBAIversusABDULLA KOYLOTH

                  [2010] 13 (ADDL.) S.C.R. 280


A       COMMISSIONER OF CUSTOMS (GEN), MUMBAI
                             v.
                     ABDULLA KOYLOTH
              (Civil Appeal No. 1608 of 2005)
                       OCTOBER 29, 2010
B
               [D.K. JAIN AND T.S. THAKUR, JJ.]

        Customs Act, 1962:

c      Section 14(1) - Valuation of imported goods for purposes
  of assessment - Mis-declaration with respect to country of
  origin, quantity and value of imported items - However,
  Tribunal accepting the transaction value as declared by
  assessee - HELD: Price paid by an importer to the vendor
0 in the ordinary course of commerce is to be. taken the
  transaction value in the absence of any special
  circumstances indicated in s. 14(1) of the Act and
  particularized in Rule 4(2) of 1988 Rules - In the instant case,
  the assessee admitted that there was difference between the
  items declared and seized and that the value arrived at after
E market inquiries was acceptable to him - In the
  circumstances, the Tribunal failed to apply the procedure
  envisaged in s.14(1) of the Act read with 1988 Rules - Order
  of Tribunal set aside and matter remitted to it for
  consideration afresh - Customs Valuation (Determination of
F Price of Imported Goods) Rules, 1988 - Rules 3(ii}, 4(2) and
  5 to 8.
       The proprietorship concern of the respondent
  imported a consignment of assorted consumer goods
G like glass ware, hair dryers, gas filled cylinders and
  refrigerant-22 gas (R-22). The bill of entry for the said
  goods was filed on 3.5.2002. The goods were seized, as
  it was found that there was mis-declaration with respect
  to country of origin, quantity and value of imported items,
H                              280
 COMMISSIONER OF CUSTOMS (GEN), MUMBAI v.              281
            ABDULLA KOYLOTH
and there was no actual user licence for import of R-22       A
gas filled cylinders. The Commissioner of Customs
rejected the value declared by the respondent for the
purpose of Section14 of the Customs Act, 1962 and held
that the assessable value of the goods had to be              /

determined under Rules 6-A and 7 of the Customs               B
Valuation (Determination of Price of Imported Goods)
Rules, 1988. The Commissioner confirmed the
assessable value of the goods and the duty demand.
Additionally, the goods were ordered to be confiscated
under sections 111 (d) and (m) with the option of             c
redemption and payment of fine, and penalty was also
imposed on the respondent. R-22 gas cylinders were
confiscated absolutely u/s 111 (d) of the Act, in the
absence of actual user licence. The Customs, Excise and
Service Tax Appellate Tribunal confirmed the order as         0
regards R-22 gas cylinders, but in respect of the other
items, it allowed the claim of the assessee.

    In the instant appeal filed by the Revenue, it was
contended for the appellant that as there was mis-
declaration in the bill of entry in relation to quantity,     E
country of origin and value of the goods, the transaction
value had to be rejected in terms of Section 14(1) of the
Act and Rule 4(2) of the 1988 Rules, and in the absence
of contemporaneous imports of similar goods, Rule 7 of
1988 Rules would apply.                                       F

    Allowing the appeal, the Court

     HELD: 1.1 Both, Section14 (1) of the Customs Act,
1962 (as it existed at the relevant time) and Rule 4 of the
Customs Valuation (Determination of Price of Imported         G
Goods) Rules, 1988, provide that the price paid by an
importer to the vendor in the ordinary course of
commerce shall be taken to be the transaction value in
the absence of any of the special circumstances indicated
                                                              H
     282   SUPREME COURT REPORTS [2010) 13 (ADDL.) S.C.R.


A in Section 14(1) of the Act and particularized in Rule 4(2)
  of the 1988 Rules. Therefore, the Customs authorities are
  bound by the declaration of the importer unless on the
  basis of some contemporaneous evidence the Revenue
  is able to demonstrate that the invoice does not reflect
8 the correct val.ue. It is only when the transaction value
  under Rule 4 is rejected, that by virtue of Rule 3(ii), the
  value shall be determined by proceeding sequentially
  through Rules 5 to 8 of the 1988 Rules. [para 15} [2"92-H;
  293-A-C]
·c
       Commissioner of Customs, Mumbai Vs. J.D. Orgochem
  Limited 2008 (6) SCR 200 = (2008) 16 sec 576; and
  Commissioner of Customs, Calcutta Vs. South India
  Television (P) Ltd. 2007 (8) SCR 95 = (2007) 6 SCC 373;
  Commissioner of Customs, Mumbai Vs. Bureau Veritas &
D Ors. 2005 (2) SCR 118     = 2005 (3) SCC 285; and Eicher
  Tractors Ltd., Haryana Vs. Commissioner of Customs,
  Mumbai 2000 (4) Suppl. SCR 597 = (2001) 1 sec 315 -
  relied on.

E      Prasant Glass Works P. Ltd Vs. Collector of Customs,
  Calcutta 1996 (87) E.L.T. 518 (Tri.-Del); Prasant Glass Works
  P. Ltd Vs. Collector of Customs 1997 (89) E.L.T. A 179;
  Varsha Plastics Private Limited & Anr. Vs. Union of India &
  Ors. 2009 (1) SCR 896 = (2009) 3 SCC 365; and Collector
F of Customs, Calcutta Vs. Sanjay Chandiram 1995 (1) Suppt.
   SCR 19 = 1995 (4) sec 222, cited.

      1.2 It is evident from: a· bare reading of the imp'tlgned
  order that having regard to the factuai scenario emerging
  from the record, the Tribun·al has failed to a·pply the
G procedure envisaged in Section 14(1) of the Act read with
  1988 Rules for determining the value of the imported
  goods. The findlng of the Tribunal that "in the absence
  of any evidence to show that the invoice value was not
  correct and further in the absence of contemporaneous
H imports of identical goods the value declared by the
 COMMISSIONER OF CUSTOMS (GEN), MUMBAI v.              283
            ABDULLA KOYLOTH
assessee should be accepted as transaction value" is         A
clearly perverse and cannot be sustained, particularly, in
light of the fact that the information collected by the
revenue from the market, veracity whereof was not
questioned by the respondent, has also not b_een
examined by the Tribunal. Importantly, the Tribunal has      B
also overlooked the statement made by· the respondent
on 13.9.2002 under Section 108 of the Act, whereby he
admitted that there was difference between the items
declared, and the items actually seized by the Customs
authorities, and that the value arrived at after market      c
enquiries was acceptable to him. The said statement was
not contested by the respondent either before the
Commissioner or the Tribunal. [para 18] [294-E-G; 295-A]

    1.3. In the facts and circumstances of the case, the
Tribunal needs to re-examine the entire matter afresh,       D
particularly, in relation to the manner of valuation,
redemption fine and penalty. Consequently, the matter is
remitted back to the Tribunal for consideration afresh in
accordance with law after affording proper opportunity
of hearing to both the parties. (para 19) (295-A-B]          E
                    Case Law Reference:
    1996 (87) E.L.T. 518 (Tri.-Del)   cited       para 11
    1997 (89) E.L.T. A 179            cited       para 11    F
    2000 (4) Suppl. SCR 597           relied on   para 11
    2009 (1) SCR 896                  cited       para 11
     2008 (6) SCR 200                 relied on   para 15
                                                             G
    2007 (8) SCR 95                   relied on   para 15
    2005 (2) SCR 118                  relied on   para 15
    1995 (1) Suppl. SCR 19            cited       para 18
                                                             H
    284    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A       CIVIL APPELLATE JURISDICTION : Civil Appeal No.
    1608 of 2005.

        From the Judgment & Order dated 10.12.2004 of the
    Customs, Excise and Service tax Appellate Tribunal, West
    Regional Bench at Mumbai in Appeal Noc./493/2003/Mum.
8
        K. Swami, T.V. Ratnam, D.L. Chidananda, B. Krishna
    Prasad for the Appellant.

          Tarun Gulati, Ramesh Singh, Kishore Kunal, Rony John,
c Praveen Kumar for the Appellant.
          The Judgment of the Court was delivered by

       D.K. JAIN, J. 1. Challenge in this appeal, by the revenue,
  under Section 130E(b) of the Customs Act, 1962 (for short. "the
D Act") is to the order dated 10th December 2004 passed by the
  Customs, Excise and Service Tax Appellate Tribunal, (for short
  "the Tribunal") whereby the appeal preferred by the respondent
  has been allowed holding that the assessable value declared
  by the respondent in the bill of entry should be accepted for the
E purpose of valuation in terms of Section 14 of the Act.

        2. Mis. IPCO Enterprise, Thane, a proprietorship concern
  of the respondent imported a consignment of assorted
  consumer goods ranging from glass ware, hair dryers etc. to
F gas filled cylinders and refrigerant-22 gas (R-22). The bill of
  entry for the said goods was filed on 3rd May 2002, by M/s
  Vegha Shipping & Transport Pvt. Ltd. on behalf of Mis. IPCO
  Enterprise, whereby the total assessable value of the goods
  was declared at' 6,75, 796.90/- with duty liability of· 3,86,352/
  -.
G
        3. On an examination of the bill of entry, invoice dated 17th
  April 2002, and packing list issued by one Mis. Plizer Trading,
  Dubai, certain discrepancies were noticed by the Central
  Intelligence Unit, and therefore, first check appraisement was
H
 COMMISSIONER OF CUSTOMS (GEN), MUMBAI v. 285
      ABDULLA KOYLOTH [D.K. JAIN, J.]

ordered. Subsequently, 100% examination of the goods was               A
carried out on 13th-14th May 2002, and it was found that there
was mis-declaration with respect to country of origin, quantity
and value of the imported items.

     4. On 31st May 2002, the respondent was summoned by B
the Central Intelligence Unit, and his statement under Section
108 of the Act was recorded. Subsequently, another statement
was recorded on 6th June 2002, wherein the respondent stated
that he was not aware that he required license for import of
certain goods, and that he did not remember the country of C
origin of some of the goods.

     5. Due to large number of discrepancies found in the bill
of entry, and the fact that the import of R-22 gas filled cylinders
required actual user license, the goods were seized on 4th July ·
2002.                                                               D

     6. On 26th August 2002, the respondent wrote a letter to
the Central Intelligence Unit whereby he stated that he had
accepted the wholesale prices found out by the department by
market survey, and that the case be finalized and settled at the       E
earliest. Thereafter, duty liability was calculated in terms of Rule
6A and 7(1) of the Customs Valuation (Determination of Price
of Imported Goods) Rules, 1988 (for short "the 1988 Rules")
as it was observed that Rules 3(i) and 4 were not· applicable
due to mis-declaration, and Rule 5 and 6 could not be invoked          F
as there were no contemporaneous imports of similar or
identical goods.

     7. On-13th September 2002, another statement of the
respondent was recorded under Section 108 of the Act, wherein
he admitted, inter alia, that there was difference in thE} items G
declared and the items actually found and seized under
Panchnama, and that the prices of the items, in question, found
by the market survey were acceptable to him.

     8. Vide his order dated 21st April 2003, the Commissioner         H
    286    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A   of Customs rejected the assessable value declared in the bill
    of entry. Dealing with explanation furnished on behalf of the
    respondent regarding some of the crockery items, the
    Commissioner observed thus :

B         "As regards the contention that inadvertently in the packing
          list and the invoice, the word "Set" was omitted and
          officers took it as single piece in place of set, I find that
          whoever there are dinner sets mentioned in the invoice
          and packing list, the quantities in sets have been
          specifically mentioned while for other items the declaration
c         have been in pieces. If the contention of the learned
          advocates that value declared is for a set is accepted then
          the value of these crockery items would become so low
          that such a proposition itself appears ridiculous. For
          example, the wholesale price of a single Arc brand, 25
D         Cl, glass mug of France origin in the local markets is
          Rs.40/- and of a set of 6 mugs is Rs.240/-, the declared
          CIF price of a single same mug, if it is accepted that this
          price is for a set of 6 mugs as agitated by the lear~d
          advocates, would thus be Rs.0.41 or Rs.2.46/- per set of
E         6 pieces. It is beyond any comprehension how the
          wholesale price of a single or set of this mug in the local
          markets can be Rs. 40/- and Rs.240/-respectively if they
          are so cheap as (sic) declared by the importers. Similar
          is the situation in case of all other crockery items. The
F         advocates have not given me any explanation for such a· -
          vast difference in market values of the goods and the
          declared prices. On the other hand Shri Abdulla Koyloth,
          the proprietor of the import firm has, in his letters dated
          26,08,02,09.02 and statement dated 13.09.02: accepted
G         the determination of assessable value and the duty liability
          thereon in the basis of market surveys which were
          conducted in his presence. Under the circumstances, I am
          not inclined to accept the contention of the advocates that
          the value declared is of a complete set. In any case, these
H         goods are mis-declared in respect of both quantities as
 COMMISSIONER OF CUSTOMS (GEN), MUMBAI v.                   287
       ABDULLA KOYLOTH [D.K. JAIN, J.]
    well as value. This was done with a clear intention of evade    A
    duty."

      Thus, having rejected the value declared by the respondent
for the purpose of Section 14 of the Act, the Commissioner held
that the assessable value of the goods had to be determined         B
under Rules 6A and 7 of the 1988 Rules. Accordingly, he
confirmed the assessable value of the goods at '23,69,838/-
and the duty demand of '13, 17,091/- as customs duty on them.
Additionally, the Commissioner ordered the confiscation of the
said goods under Sections 111 (d) and (m) of the Act, with the      C
option of redemption on payment of fine of '30, 11,525/-.
However, R-22 gas filled cylinders were confiscated absolutely
under Section 111 (d) of the Act. The Commissioner also
imposed a penalty of '10 lakhs on the respondent ·under
Section 112(a) of the Act.
                                                                    D
     9. Being aggrieved by the said order of the Commissioner,
the respondent carried the matter in appeal before the Tribunal.
As afore-mentioned, the Tribunal allowed the appeal of the
importer in relation to the assessabie value and confiscation
of the imported glassware, infer a/ia, observing thus:              E

    "4. After going through the impugned order, we find that
    the Commissioner has rejected the invoice value on the
    sole ground that majority of the goods were declared with
    their generic description only without disclosing any brand
    name or make, etc. He has also gone on the reason that          F
    the glass items were found to be in excess quantity than
    the declared one. However, we find that the invoice as also
    the packing list was annexed with the bill of entry and the
    consignments in any case were of assorted items from
    different countries. As such, it cannot be said that there is   G
    mis-declaration as regards description of the goods. As
    regard, variation in quantity of glass items, the appellant
    have submitted that they had declared the number of sets
    instead of number of pieces.
                                                                    H
    288    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A

          The explanations tendered by the importer are plausible,
          and no case be made for rejecting the invoice value in the
          absence of any importation or evidence to reflect upon the
          flow back of money by the importer to the
B
          supplier ........................................... .

          6. We are of the view that in the absence of any evidence
          to show that the invoice value was not correct and further
          in the absence of contemporaneous imports of identical
c         goods, the value declared by the appellant should be
          accepted as transaction value and not to be rejected."

          In relation to the confiscation of the R-22 gas filled
                                                1


          cylinders, the Tribunal held that the confiscation of the said
D         goods was justified on the ground that the said g9ods had
          to be imported against an actual user license, which the
          respondent did not possess. The Tribunal also deleted the
          penalty levied on the respondent on the ground that since
          the value enhancement had not been upheld by it, there
          was no cause for imposition of penalty.
E
          10. Hence, the present appeal.

       11. Mr. K. Swami, learned counsel appearing for the
  revenue, while assailing the order of the Tribunal, strenuously
F urged that since the respondent had made mis-declarations in
  the bill of entry in relation to quantity, country of origin and value
  of the goods, the transaction value had to be rejected in terms
  of Section 14(1) of the Act and Rule 4(2) of the 1988 Rules.
  Learned counsel further contended that in the absence of
G contemporaneous imports of identical or similar goods, Rule
  7 of 1988 Rules would apply. Commending us to the decision
  of the Tribunal in Prasant Glass Works P. Ltd Vs. Collector of
  Customs1 , Calcutta which attained finality because of dismissal
  of assessee's appeal by this Court in Prasant Glass Works P.
H 1.   1996 (87) E.L.T. 518 (Tri.-Del)
     COMMISSIONER OF CUSTOMS (GEN), MUMBAI v.                    289
          ABDULLA KOYLOTH [D.K. JAIN, J.]

Ltd Vs. Collector of Customs. 2 , wherein it was held that in a A
case where the invoice value shown is inadequate, incomplete
or erroneous, then such invoice and the price declared therein
will carry little weight, and the department is not required to show
that the invoice price is defective and cannot be accepted.
                                                                         B
      12. Per contra, Mr. Tarun Gulati, learned counsel appearing
for the respondent contended that in light of the decisions of this
Court in Eicher Tractors Ltd., Haryana Vs. Commissioner of
Customs, Mumbai3 and Varsha Plastics Private Limited & Anr.
 Vs. Union of India & Ors. 4 , the onus lies on the revenue to C
establish that the transaction value disclosed by the importer
is not correct. Learned counsel contended that in the instant
case, the revenue having failed to bring on record any material
indicating undervaluation in the invoice, the value declared by
the importer had to be accepted. While candidly conceding that
though there could be some discrepancy in the mode of D
declaration of the quantity of certain glassware, in as much as
the respondent had declared the quantity in sets, whereas the
Commissioner had gone by the actual numbers, learned
counsel asserted that as such there was no mis-declaration in
relation to the assessable value, more so, when the bill of entry E
was supported by the invoice and the packing list. It was thus,
pleaded that there is no merit in this appeal.

     13. Thus, the short issue that arises for determination
relates to the manner of computing the assessable value of the           F
imported goods. For the sake of ready reference, it would be
useful to extract Sections 2(41 ), 14 (1) (as it stood at the relevant
time) and 14(1-A) of the Act, which read as follows:

       "2(41) 'value', in relation to any goods, means the value
       thereof determined in accordance with the provisions of G
       sub-section (1) of Section 14;

2.    1997 (89) E.L.T. A 179.
3.    c2001) 1 sec 315.
4.    (2009) 3 sec 365.                                                  H
    290     SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A         14. Valuation of goods for purposes of assessment.-(1)
          For the purposes of the Customs Tariff Act, 1975 (51 of
          1975), or any other law for the time being in force
          whereunder a duty of customs is chargeable on any goods
          by reference to their value, the value of such goods shall
B         be deemed to be-

          the price at which such or like goods are ordinarily sold,
          or offered for sale, for delivery at the time and place of
          importation or exportation, as the case may be, in the
          course of international trade, where-
c
          (a) the seller and the buyer have no interest in the business
          of each other; or

          (b) one of them has no interest in the business of other,
D         and the price is the sole consideration 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 under Section 46, or a shipping
E         bill or bill of export, as the case may be, is presented under
          Section 50;

          (1A) Subject to the provisions of sub-section (1), the price
          referred to in that sub-section in respect of imported goods
F         shall be determined in accordance with the rules made in
          this behalf."

         14. It would be also useful to extract Rules 2(f), 3 and 4 of
    the 1988 Rules, which provide that:

G         "2(f) "transaction value" means the value determined in
          accordance with Rule 4 of these rules.

          3. Determination of the method of valuation.-For the
          purpose of these rules -
H
COMMISSIONER OF CUSTOMS (GEN), MUMBAI v. 291
      ABDULLA KOYLOTH [D.K. JAIN, J.]

           i. the value of imported goods shall be the transaction     A
  value,

        ii. if value cannot be determined under the provisions
  of clause (i) above, the value shall be determined by
  proceeding sequentially through Rules 5 to 8 of these rules.         B

  4. Transaction value.-(1) The transaction value of
  imported goods shall be the price actually paid or payable
  for the goods when sold for export to India, adjusted in_
  accordance with the provisions of Rule 9 of these rules.
                                                                       c
  (2) The transaction value of imported goods under sub-rule
  (1) above shall be accepted:

           Provided that-

       (a) there are no restrictions as to the disposition or          D
  use of the goods by the buyer other than restrictions
  which-

       (1) are imposed or required by law or by the public
  authorities in India; or                                             E

       (it) limit the geographical area in which the goods
  may be resold; or

           (iit) do not substantially affect the value of the goods;
                                                                       F
        (b) the sale or price is not subject to same condition
  or consideration for which a value cannot be determined
  in respect of the goods being valued;

         (c) no part of the proceeds of any subsequent resale,
  disposal or use of the goods by the buyer will accrue directly       G
  or indirectly to the seller, unless an appropriate adjustment
  can be made in accordance with the provisions of Rule 9
  of these rules; and              ·

                                                                       H
    292    SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A               (d) the buyer and seller are not related, or where the
          buyer and seller are related, that transaction value is
          acceptable for customs purposes under the provisions of
          sub-rule (3) below.

          (3)(a) Where the buyer and seller are related, the
B
          transaction value shall be accepted provided that the
          examination of the circumstances of the sale of the
          imported goods indicate that the relationship did not
          influence the price.
c               (b) In a sale between related persons, the
          transaction value shall be accepted, whenever the importer
          demonstrates that the declared value of the goods being
          valued, closely approximates to one of the following values
          ascertained at or about the same time-
D
          (1) the transaction value of identical goods, or of similar
          goods, in sales to unrelated buyers in India;

          (ii) the deductive value for identical goods or similar
          goods;
E
          (iii) the computed value for identical goods or similar
          goods:

          Provided that in applying the values used for comparison,
          due account shall be taken of demonstrated difference in
F
          commercial levels, quantity levels, adjustments in
          accordance with the provisions of Rule 9 of these Rules
          and cost incurred by the seller in sales in which he and the
          buyer are not related;
G         (c) substitute values shall not be established under the
          provisions of clause (b) of this sub-rule."

       15. Both Sections 14(1) of the Act (as it existed at the
  relevant time) and Rule 4 of the 1988 Rules provide that the
H price paid by an importer to the vendor in the ordinary course
 COMMISSIONER OF CUSTOMS (GEN), MUMBAI v.                    293
      ABDULLA KOYLOTH [D.K. JAIN, J.]
of commerce shall be taken to be the transaction value in the        A
absence of any of the special circumstances indicated in
Section 14(1) of the Act and particularized in Rule 4(2) of the
1988 Rules. Therefore, the Customs authorities are bound by
the declaration of the importer unless on the basis of some
contemporaneous evidence the Revenue is able to                      B
demonstrate that the invoice does not reflect the correct value.
(See: Commissioner of Customs, Mumbai Vs. J.D.
Orgochem Limited5 and Commissioner of Customs, Calcutta
 Vs. South India Television (P) Ltd. 6} It is only when the
transaction value under Rule 4 is rejected, that by virtue of Rule   c
3(ii), the value shall be determined by proceeding sequentially
through Rule 5 to 8 of the 1988 Rules. (See: Commissioner of
Customs, Mumbai Vs. Bureau Veritas & Ors. 7 and Eicher
Tractors Ltd. (supra)). Rule 5 allows for the transaction value
to be computed on the basis of identical goods imported into
                                                                     0
at the same time whereas Rule 6 provides for the computation
of transaction value on the basis of the value of similar goods
imported into India at the same time as the subject goods. In
the absence of contemporaneous imports into India, the value
is to be determined under Rule 7 on the basis of a process of
deduction contemplated therein. If this is not possible, then        E
recourse must be had to Rule 7-A, and if none of these methods
can be employed to compute the transaction value, Rule 8
provides that the transaction value can be determined by using
reasonable means consistent with the principles and general
provisions of these Rules and sub-section (1) of Section 14 of       F
the Act and on the basis of data available in India.

     16. In Varsha Plastics Private Limited (supra), this Court
while dealing with a similar situation where the importer had
misdeclared in terms of value, description and quality of the        G
imported goods, had held that:

5.   (2008) 16 sec 576.
6.   (2007) 6 sec 373.
7.   c2005) 3 sec 265.                                               H
    294     SUPREME COURT REPORTS [2010] 13 (ADDL.) S.C.R.


A         "It has to be kept in mind that once the nature of goods
          has been misdeclared, the value declared on the imported
          goods becomes unacceptable. It does not in any way
          affect the legal position that the burden is on the Customs
          Authorities to establish the case of misdeclaration of goods
B         or valuation or that the declared price did not reflect the
          true transaction value."

        17. Similarly, in Collector of Customs, Calcutta Vs.
    Sanjay Chandiram, 8 a three judge bench of this Court
    observed that:
c
          "These rules are based on the assumption that the price
          actually paid or payable for the goods has been genuinely
          disclosed by the importer. But, if the certificates of origin
          of the goods have been found to be false, the value
D         declared in the invoices cannot be accepted as genuine."

        18. It is evident from a bare reading of the impugned order
  that having regard to the factual scenario emerging from the
  record, the Tribunal has failed to apply the procedure envisaged
E in Section 14(1) of the Act read with 1988 Rules for
  determining the value of the imported goods. Having carefully
  perused the Tribunal's order, in particular the above-extracted
  paragraph, we are convinced that the finding of the Tribunal in
  para 6 (supra) of the impugned order is clearly perverse and
  cannot be sustained, particularly in light of the fact that the
F information collected by the revenue from the market, veracity
  whereof was not questioned by the respondent, has also not
  been examined by the Tribunal. Importantly, the Tribunal has
  also overlooked the statement made by the respondent on 13th
  September 2002 under Section 108 of the Act, whereby he
G admitted that there was difference between the items declared,
  and the items actually seized by the Customs authorities, and
  that the value arrived at after market enquiries was acceptable
  to him. The said statement was not contested by the

H a.   (1995) 4 sec 222.
 COMMISSIONER OF CUSTOMS (GEN), MUMBAI v.                    295
      ABDULLA KOYLOTH [D.K. JAIN, J.]
respondent either before the Commissioner or the Tribunal.           A

     19. In light of the foregoing discussion, we are of the
opinion that the Tribunal needs to re-examine the entire matter
afresh, particularly in. relation to the manner of valuation,
redemption fine and penalty. Consequently, the appeal is             B
allowed, and the matter is remitted back to the Tribunal for fresh
consideration in accordance with law after affording proper
opportunity of hearing to both the parties.

       20. There will be no order as to costs:
                                                                     c
R.P.                                             Appeal allowed.