G.A. Brahma Deva, Member (J)

1. This appeal arises out of and is directed against the Order-in-appeal No. 3330/88-BCH (S/49-122/87 VL/SVB (BMY) dated 30-8-1988 passed by the Collector of Customs (Appeals), Bombay.

2. Respondents M/s. India Photographic Co. Ltd., Bombay is a Public Limited Company, Kodak Limited, Rochester, U.K. is holding 39.5% equity participation and have two Directors on the Board of Directors of the Indian Company. Previously the Special Valuation Branch of Bombay Customs which took up the question of valuation of goods viz., colour films and colour paper etc., imported by respondent (IPC), decided that all the imports from Kodak Companies should be assessed at invoice value Under Section 14(1)(a) of the Customs Act, 1962 as per its decision No. S/43-137/86 SVB dated 27-8-1981. This decision of S.V.B. accepting the invoice value under Section 14(1)(a) of Customs Act, 1962 was taken up for review. A search was conducted at their premises on 10-7-1985 and certain documents were seized. Based on these seized documents investigations were carried out and a tentative decision was served upon the respondent Company informing them of loading of invoice value of goods imported from Kodak Company by 60% under Rule 8 of Customs Valuation Rules, 1963. The respondents have replied to the above tentative decision inter alia denying all the allegations in the tentative decision and submitting that invoice value was the correct assessable value under Section 14(1)(a) of the Customs Act, 1962 and that there was no justification to load c.i.f./f.o.b. value on any Kodak Products imported by them.

3. The Assistant Collector, Special Valuation Branch, who adjudicated/reviewed the proceedings after considering their detailed replies and clarifications, although dropped several charges which were levelled in the tentative decision as not maintainable but still, however, he passed an order holding that the valuation will have to be considered under Section 14(1)(b) of the Customs Act read with Rule 8 of the Customs Valuation Rules, 1963 and ordering for the loading of goods in various items as follows :-

(1) Motion Picture Films (Positive) : The invoice value of all imports made from Kodak Company Rochester and their associates shall be loaded @ 5%.

(2) Graphic Art Films: The invoice value of all imports made from Kodak Co., Rochester and their associates shall be loaded @ 12.5%.

(3) Camera Films Rolls of all types: The invoice value of all imports made from Kodak Co. Rochester their associates shall be loaded @ 3%.

(4) Photography Paper: The invoice value of all imports made from Kodak Co. Rochester their associates shall be loaded @ 7.5%.

(5) Photography Chemical: The invoice value of all imports shall be loaded @ 10%.

(6) Equipment like Mini-Lab, Microfilming equipments, Slide Projector and their spares : The invoice value of all imports made from Kodak Co., Rochester Microbra Inc., Extex and any other connected parties of M/s. IPC shall be loaded @ 8%.

(7) Motion Picture Films (Negative): Import is canalised through NFDC. IPC imports on behalf of canalising agency. The material is sold to actual user as per the release order issued by NFDC at the rate prescribed by NFDC. No loading is called for. There are no direct imports in this case. IPC do not recover any service charge. In view of this it has been decided to accept invoice value under Rule 8 of Customs Valuation Rules, 1963.

The decision to load their prices for assessment under Section 14(1)(b) of Customs Act, 1962 was based on the following factors :-

(i) Finding out foreign suppliers viz: Kodak in exclusion to others,

(ii) Obtaining quotation/proforma invoice,

(iii) Suggesting a name of a clearing agent,

(iv) Technical guidance by expert staff.

(v) Services to store the material in temperature and humidity control cold rooms on Party's request.

(vi) For equipments services like installation and calibration.

The Assistant Collector also quoted the service charg