Saash Enterprises vs. The Commissioner of Customs - (Customs, Excise and Service Tax Appellate Tribunal) (27 Jun 2024)

Transaction value has to be accepted unless there are compelling reasons to reject the same

MANU/CB/0141/2024

Customs

The Appellantfiled a Bill of Entry No.8730452 dated 11th December, 2012 for clearance of different items such as laminators, wire binding machines, paper cutters, etc., along with Bill of Lading, commercial invoice, packing list, certificate of origin and a document with the description of the goods imported. The consignment was examined and the inventory of items which was declared was found to be correct, however, the department doubted the value and engaged a Chartered Engineer to determine the correct value.

The Chartered Engineer estimated the value to be USD 69,021 as against the declared C & F value of USD 55,142.06. Investigations also revealed that there were different invoices for identical sets of items where the buyer and the seller were the same and each of the invoices had declared different values. Thus, based on the investigations and various statements, the original authority rejected the declared value in terms of Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, and refixed the value at Rs.46,43,362 as against declared value of Rs.30,96,158. The goods were held to be liable for confiscation in terms of Section 111(d) of the Customs Act, 1962 and an option was given to redeem the goods on payment of fine of Rs.5,00,000 and a penalty of Rs.2,00,000 was imposed on the appellant under Section 112(a) of the Customs Act 1962. This order was upheld by the Commissioner (Appeals) holding that the appellant had manipulated invoice and mis-declared the actual value.

Emails recovered during investigation showed multiple invoices for the same set of goods where the buyer and supplier were one and the same. But there was nothing on record to prove that the amount paid to the buyer was more the value declared in the commercial invoice filed by the appellant along with the Bill of Entry. The statements have been retracted and the cross-examination of the Chartered Engineer has been denied, which is against the principles of natural justice.

Section 14 of the Customs Act, 1962 clearly stipulates that the transaction value has to be accepted unless there are compelling reasons to reject the same. Moreover, any transaction value to be rejected has to be done as per the Customs Valuation Rules.

There was absolutely no methodology followed but randomly the total value is being redetermined, which appears to be absolutely against the Rule of Law. Moreover, the emails and the statements do not suggest that that any extra payment was made to the buyer by the appellant in excess of what has been declared in their commercial value; therefore, the question of enhancing the value based on some random emails and statements without any corroboration has no evidentiary value.Present Tribunal do not find any reason to uphold redetermination of the value. Therefore, the impugned order is set aside. Appeal allowed.

Tags : VALUATION CONFISCATION PENALTY