Per Justice U.L. Bhat : Appellants imported one consignment of 20,000 Gross Bolt Ring (Spring Ring) and 500000 number of Chain of Hongkong origin from a Hongkong supplier and presented a Bill of Entry dated 11.8.89 through the Clearing Agent at the declared value of HK$ 1.00 per gross of Bolt Ring and HK$ 7.3 for 100 Meters of Chain. On objection being raised about the value, appellants waived show cause notice but gave written submissions. Representative samples were also taken and weighed. The Additional Collector accepted the declared value in relation to Bolt Ring but loaded the value of Chain from HK$ 7.3 per 100 Meters to Rs. 56.36 per Kg. weight. This order is now challenged.

2. The Additional Collector noticed that in regard to chain, unlike in the previous importation, specification and design number of the chain had not been declared by the appellants. On weighment and calculation it was found that the declared value was Rs. 25.58 per Kg which was even less than the price of Rs. 28.18 per Kg. for brass scrap imported at the Calcutta Port. Metal Bulletin (UK) also showed the price of brass scrap "Honey" at the material time was US$ 1700 per MT. i.e. Rs. 28.18 CIF per Kg. The Additional Collector concluded that since the price of brass scrap was Rs. 28.18 per Kg. the price of finished product, namely, Chain must be much more and adding 100% manufacturing cost arrived at the CIF value of Rs. 56.36 per Kg. under Rule 8 of the Customs Valuation Rules, 1988. He also confiscated the goods under section 111 (m) of the Customs Act, 1962, permitting the appellants to redeem the same on payment of fine of Rs. 25,000. He also imposed penalty of Rs. 10,000.

3. The main dispute relates to the valuation of 500.000 pcs. of Chain imported by the appellants. Since the Additional Collector found mis-declaration of value, the consequences of confiscation, redemption fine and penalty followed.

4. Learned Counsel for the appellants contended that both Bolt Ring and Chain imported by the appellants were covered by the same invoice and since the invoice value of Bolt Ring has been accepted, necessarily the invoice value of Chain must be accepted. Learned Counsel further contended that in the absence of finding that there was special relationship with the supplier and in the absence of any evidence to show that more than the invoice price had been paid to the supplier as also in the absence of evidence regarding contemporary imports at higher value, the adjudicating authority should have accepted the invoice value for Chain also.

5. Burden of displacing the invoice price is certainly on the Department. It can be displaced on values of comparable imports of identical or similar goods. This proposition is based on the principle that the invoice value reflecting the true transaction value should, ordinarily be accepted, except in the presence of special circumstances like the transaction not being at arms length, special relationship between the importer and supplier, comparable imports at higher price or other reliable circumstances. This is so, if the invoice and other relevant documents are ex facie reliable and proper.

6. In Shivshakti Enterprises Vs. Collector of Customs, 1991 (52) ELT 439 (T) imported goods declared to be "Metal fittings rivets" were actually found to be snap fasteners and not rivets. For that reason, the Tribunal held that the declared price cannot be said to be the transaction value of snap fasteners and the question of its acceptance did not arise (paragraph 8). In Universal Commercial Corporation Vs. Collector of Customs, 1994 (69) ELT 50 (T), the importer declared the imported goods to be "Condenser Units" of Singapore origin. The goods were found to be full air-conditioners without outer metal cover and selector switch of USA origin. It was observed that the plea based on transaction value will hold good only if the goods imported are the same as indicated in the invoice. In final order No. 2275-2277/96-A dated 5.7.