BERGER BECKER COATINGS PVT. Vs. CC

JUDGEMENT

(1.) THE appellant is a manufacturer of paints. It is jointly owned by M/s Becker Industrifarg A.B. Sweden and Rajdoot Paints Ltd.

(2.) THE issue raised in this appeal is the valuation of 18 inputs imported by the appellant from M/s Beker Industrifarg AB, Sweden for the manufacture of paints. Out of the 18 items, three items, being Sl.No. 4, 5 and 7, were imported by the appellant from unrelated parties also. In view of the relationship between the parties, the customs authorities rejected the transaction value for the purpose of assessment of imports from M/s Becker Industrifarg A.B. Sweden. Instead, the average price noted in the case of imports from unrelated buyers was applied for the assessment of the three items imported from M/s Becker Industrifarg A.B. Sweden. In regard to the remaining 15 items, which were imported from related person only, purchase prices from the related person were loaded to the extent of the average of the price differential (44.17%) in the import of the three items imported from both related and unrelated parties and assessments finalized. The appellant is aggrieved by the enhancement of value and challenges the same in the present appeal.

(3.) THE challenge to the valuation is on two counts. The first contention is that in terms of Rule 4(3)(a) of Customs Valuation Rules, transaction value is required to be accepted provided it satisfies the criterion laid down in the Rule. The other contention is that, even upon a finding that the requirement of Rule 4(3)(a) has not been satisfied, it is impermissible under valuation rules to adopt average price difference in other transactions or to apply the average of differences in other transactions in other goods for the valuation of imported goods. It is being pointed out that Rule 5(3) specifically states that when there are many transactions, the lowest of the prices is to be adopted.