Custom, Excise & Service Tax Tribunal
M/S. Sedna Impex India Pvt.Ltd vs Cc, Faridabad on 3 August, 2016
?CUSTOMS, EXCISE & SERVICE TAXAPPELLATE TRIBUNAL SCO 147-148, SECTOR 17-C, CHANDIGARH-160017 DIVISION BENCH COURT NO.1 Appeal No. C/53796 to 53801/2014Cus(DB) C/53810 to 53819/2014, C/53795,53809/2014 [Arising out of the OIA No.26-32-CUS/APPL-DLH-2014 dt.22.4.14, OIA No.13-23-CUS/APPL-DLH-2014 27.03.14 passed by the CCE, Delhi-IV, Faridabad) Date of Hearing/Decision: 03.08.2016 For Approval &signature: Honble Mr.Ashok Jindal, Member (Judicial) Honble Mr. B.Ravichandran, Member(Technical) 1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3. Whether their Lordships wish to see the fair copy of the order? seen 4. Whether order is to be circulated to the Department Authorities? Yes M/s. Sedna Impex India Pvt.Ltd. Appellant Garg Impex Vs. CC, Faridabad Respondent
Appearance Shri Prem Ranjan, Advocate- for the appellant Shri Harvinder Singh, A.R.- for the respondent CORAM: Honble Mr.Ashok Jindal, Member (Judicial) Honble Mtr.B.Ravichandran, Member (Technical) FINAL ORDER NO 61032-61049/2016 Per Ashok Jindal:
The appellants are in appeal against the impugned orders.
2. As the issue in all the appeals is common, therefore, they are taken up together and are being disposed of by this common order.
3. The brief facts of the case are that the appellant imported polyester knitted fabrics and filed bill of entry declared the transaction value as 2.00 to 2.63 @ USD per kg but the same was assessed to USD 2.85 per kg on the basis of one DRI alert that the overseas suppliers are undervaluing the price of fabrics. The value was enhanced on contemporaneous bill of entry assessed, therefore the value was enhanced of imported fabrics which was challenged by the appellant before the Commissioner (Appeals) who rejected their appeal. Aggrieved with the said order, the appellants are before us.
3. Learned Counsel for the appellant submits that no notice was given to the appellant, moreover, no speaking order under section 17(5) of the Customs Act, 1962 has been passed by the adjudicating authority. The sole reason for enhancing the declared value that there was DRI alert that the overseas suppliers were undervaluing the price of the fabrics and there was assessed bill of entry at the rate of 2.85 US$ per kg which is not correct. On the basis of DRI, the value of the imported goods cannot be enhanced without rejecting the same, moreover, reliance placed on the assessed bill of entry is not correct in view of the decision of this Tribunal in the case of Ravi Dyeware Co.Ltd. -2014 (301) 421) and in the case of Samar Polytex Ld.-2009 (238) ELT 621 (Tri.-Del.).
4. It is further submitted that in the impugned order, the Commissioner (Appeals) have relied on the assessed bill of entry which have mostly set aside by this Tribunal on the ground that no speaking order has been passed by the adjudicating authority under section 17(5) to reject the declared value. Moreover, no other evidence has been produced on record on account of contemporaneous import of similar goods. Therefore, the impugned orders are to be set aside.
5. On the other hand, learned AR reiterated the findings of the Commissioner (Appeals).
6. Heard the parties and considered the submissions.
7. On hearing the parties, we find that the value of the imported goods has been enhanced on the grounds:
(a) on the basis of DRI alert and
(b) on the basis of assessed bill of entry of similar goods.
8. We find that the initially there was DRI alert that the overseas suppliers are undervaluing the value of the goods in question, the same cannot be the reason for enhancement of the value without rejecting the transaction value. The Customs Valuation Rules deals with situation how to enhance the value of the imported goods. DRI have not concerned with the said Valuation Rules, therefore, the declared value cannot be enhanced on the basis of DRI alert.
9. In the impugned order, we find that the Commissioner (Appeals) has relied on the assessed value and not the value declared. Rule 5 of the Valuation Rules provide for enchantment of the value is to be done as per sub rule. Moreover, the value is found less of the value to determine, the value imported of the goods. In this case, the department has assessed identical goods at the rate of 2.85 US$ per kg whereas the value declared by the appellant ranges between 2.00 US$ to 2.63 US$ per kg. The price which has been adopted to be assessed is not the declared value in fact, the same is the assessed value. Therefore, the said value cannot be computed and cannot be said as the value of contemporaneous import. Similar issue came up before this Tribunal in the case of Ravi Dyeware Co. Ltd. (supra) wherein this Tribunal has observed as under:
5.1The enhancement of the value has been done under? Rule 5 of the Customs Valuation Rules, 1988. As per the said Rule, if more than one value is found, then the lowest of the such value shall be used to determine the value of the imported goods. In the present case as pointed out by the ld. Counsel, the department has assessed identical goods at lower values ranging from US $ 1070 to US $ 1090 PMT, whereas the value declared by the appellant is higher at US $ 1100 PMT. Further, the price adopted for comparison is not a declared value but an enhanced value by the Customs. The values declared in those transactions ranged from US $ 1050 to US $ 1090 PMT. In the case laws cited by the appellant, this Tribunal has already held that for the purpose of comparison of contemporaneous imports, the value to be adopted is not the value arrived at after loading by the department but the value that has been declared and accepted without any enhancement. Besides, we notice that no evidence has been led by the Revenue in the instant case to counter the appellant's contention that the transaction value declared by them, as evident from the documents is not the real transaction value.
6.In view of the above, we are of the considered view? that the value of US $ 1100 PMT declared by the appellant has to be accepted as the transaction value. Consequently, the enhancement of the value made by the lower authorities are not sustainable in law. Hence, the appeal is allowed with consequential relief, if any
10. Further in the case of Samar Polytex Ltd. (supra) again this Tribunal has observed as under:
6.?We have carefully considered the submissions. The principles based on which the declared transaction value can be rejected and value of cotemporaneous can be adopted are well settled. A comparison of prices of goods of two distinct varieties, (i.e. nylon with polyester-nylon mix) and that too from two different countries is not permissible. Further, the price adopted was not the actual import price but the price enhanced by the Department which has been reportedly accepted. Such an enhanced price can not be treated as transaction value of similar goods sought to be compared. We have not been shown any evidence of actual higher import price of similar goods which can be adopted for the present import. In view of the above, the orders of the Commissioner enhancing the assessable value cannot be sustained.
11. In view of the above discussion, we hold that the value of the imported goods cannot be enhanced on the basis of value of assessed value of bill of entry. Further, we take note of the fact that similar goods have been imported by the other importers in whose case the value was enhanced by adopting the contemporaneous assessed bill of entry and the decision of the Tribunal time and again set aside the enhancement of the value in the case of Maruti Fabrics Impex vide Order No.51690-51694/16 dated 27.4.2016 is not justified without rejecting the translation value of the same and observed as under:
6. As regards the second issue, we find that Commissioner (Appeals) has gone into detailed examination of the provisions of Section 14 as also the Customs Valuation [Determination of Value of Imported Goods] Rules, 2007. As rightly observed by him, for adopting the provision of Customs Valuation Rule, the transaction value is required to be rejected as incorrect value. There being no evidence to show that the importer has paid over and above than the transaction value, to the seller of the goods, there is virtually no reasons to reject the transaction value. It is also a settled law that DRI Alerts cannot be adopted as a reason for enhancing the value. As such, we find no infirmity in the views adopted by the Commissioner (Appeals) so as to interfere in the impugned order. Accordingly, the appeals filed by the Revenue are rejected.
11. In view of the above, discussion, we hold that the value of imported goods in question cannot be enhanced on the basis of DRI alert and the basis of assessed bill of entry in question, therefore the impugned orders are set aside.
12. In the result, the appeals are allowed with consequential relief, if any.
(Pronounced in the open court) (B.Ravichandran) (Ashok Jindal) Member (Technical) Member (Judicial) mk 1