PTCL 2010 CL 95 (LHC) M/S M.A.H.

Traders versus Deputy

Collector Customs and 4 Others


This case relates to the validity of a Valuation Advice under
section 25-A in the light of the provisions of section 25 and the
Rules.

In the instant case, the value of the imported goods was
determined under a Valuation Ruling issued under section 25-A
of the Act. However Petitioner was aggrieved of the valuation
made by the Customs Officials on the basis of the Valuation
Ruling as aforesaid. The Petitioner therefore filed a writ petition
and challenged the Valuation Ruling issued under section 25 (7)
(deductive method) on the grounds of non-compliance with
statutory provisions and discrimination.

The Court accepted the writ petition while relying on one of its
earlier judgments which held that:

Therefore there is no reason for this Court to agree with the learned
Legal Adviser that the compliance has been made as was legally
required. The advice speaks of non-acceptance of the transportable value
of the identical and similar goods for the reason that the quality of the
product is different but however it has not mentioned what convinced
the authority to adopt deductive valuation method for preparation of the
said ruling. As already said, it should have been based upon proper
discussion and reference to the value of the said items. Neither the unit
price has been mentioned nor its retail price in the market has been
identified. The method in fact is again the same repetition as was being
done earlier except that the nomenclature of the method is now being
referred. There is therefore no reason for this Court to agree with the
respondents counsel that the advice is valid, lawful and applicable on
the facts of this case.


PTCL 2010 CL 868 (SHC) COLLECTOR OF CUSTOMS v M/S
CHINA NATIONAL WATER RESOURCES

The question that came up for discussion in this case was that is
it permissible under section 25 of the Act that the price of any
imported good can be determined on the mere opinion (in this
case Ambassador of Pakistan in Japan) of a person.

The respondent had imported 8 units of Mitsubishi Dump Truck
in CBU condition from Japan. On arrival of the consignment, the
respondent filed bill of entry alongwith general declaration for
home consumption and declared the unit value of the Dump
Truck to be 4,970,000 Japanese Yen. Department however was not
agreed with the value declared and therefore provisional
assessment under section 81 by adding value of 15% was made.
The matter was then referred to the Director General Valuation.
The Director General on the basis of a letter from the Embassy of
Pakistan in Japan advised valuation per unit of Japanese
6,000,000. The respondent was called upon to pay an amount of
Rs. 4,240,636 within seven days. The respondent however
contested the assessment made on the mere opinion of the
Ambassador of Pakistan in Japan but failed to convince the
Customs authorities of his contention. He was however successful
before the Tribunal. The matter went up to the High Court.

The High Court relied upon its earlier Judgment on this point i.e.
Abdul Aziz Ayoob versus Assistant Collector of Customs (PTCL 1990
CL 1041) in which it was held:

This brings us to the next question whether the basis which was adopted
by the customs to determine the price of the imported goods was
contrary to law. As seen above, learned Counsel has placed reliance on
Collector of Central Excise and Land Customs v. Imdad Ali 1969
SCMR 708 in which case for various reasons detailed in the Judgment
the Supreme Court declined to uphold reliance on a certificate issued by
the relevant Embassy of Pakistan as regards the price of the imported
commodity. We would straightaway record that such basis as a rule
suffers from serious infirmity and should be avoided. Where such a letter
or certificate is relied upon the Embassy concerned should be asked as
opined in the Supreme Court Judgment to attach a price list or
certificates from the traders or their own certified assessment in the
relevant country wasand short of this the version of the Embassy should
not be accepted.


PTCL 2007 CL 199 (SC) M/s Flying Board v. Deputy Collector of
Customs

The issue dealt with in this case is whether an importer can take
benefit of the falling prices in so far assessment under section
25 is concerned.

The Appellants imported 21 consignments on the declared value
of $500 each. Pre-Shipment Inspection Company however
determined the value at $ 510.05. In the meantime there was news
that the international prices of the consignments had been
depreciating considerably in prices in the international markets.
The Appellants approached the High Court for relief. The High
Court vide an interim order dated 25-11-1996 allowed the
provisional release of goods at $350 plus 10% of the declared
market value. However Deputy Collector Customs vide order
dated 22-02-2002 directed appellant to clear the consignment at
the invoice value of the goods at $ 510.05 per metric ton. The
Appellant preferred an appeal without success to the Collector of
Customs. Thereafter appeals made to the High Court were also
dismissed.

The issue before the Supreme Court was whether under the
provisions of section 25, the Appellant could claim to have its
goods cleared below the declared invoice value. The Supreme
Court held:

The appellant having imported the 21 consignments at the declared price
of $ 500per metric ton could not claim to be assessed at the lower prices
of $350/370 per metric ton. The appellant having imported the 21
consignments at the declared price of $500 per metric ton could not
claim to be assessed at a lower price even if it had succeeded to establish
that prices had gone down after purchase of the above consignments.


PTCL 2006 CL 499 (LHC) M/s Sohrab Global Marketing versus
Deputy Collector Customs

This case deals with the issue of issuing frequent Valuation
Advices and not resorting to the provisions of section 25 for the
valuation of goods.

The Petitioner imported goods which were not valued at the
declared value but under a Valuation Advice dated 19-03-2005.
Aggrieved with the valuation made under the valuation advice
and not under the declared value, the Petitioner approached the
High Court through writ petition.

The High Court held that it is the duty of the Customs Officials to
assess value under the provisions of section 25 of the Customs
Act taking into consideration various factors mentioned therein.
The High Court held that indeed the custom officials were in
breach of the aforesaid duty when they determine value
according to a Valuation Advice. The High Court also questioned
the unlimited power of the custom official to take resort to section
25-A while ignoring completely the provisions of section 25.