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Custom, Excise & Service Tax Tribunal

Industrial Exim Pvt Ltd vs Ghaziabad on 8 October, 2018

Author: Dilip Gupta

Bench: Dilip Gupta

 IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE
                   TRIBUNAL
                REGIONAL BENCH : ALLAHABAD
                        COURT No. I

                  APPEAL No.C/52163/2015-CU[DB]

(Arising out of Order-in-Appeal No. NOI/CUSTM/000/APP/333/2014-15
dated 27/01/2015 passed by Commissioner of Central Excise & Customs
(Appeals-II), Meerut Zone at Noida)


M/s Industrial Exim Pvt. Ltd.                          Appellant
Vs.
Commissioner of Customs & Central Excise, Ghaziabad Respondent

Appearance:

Shri Mohammad Faraz Anees, Advocate for Appellant Shri Mohammad Altaf, Assistant Commissioner (AR), for Respondent CORAM:

Hon'ble Justice Shri Dilip Gupta, President Hon'ble Mr. Anil G. Shakkarwar, Member (Technical) Date of Hearing & Decision : 08/10/2018 FINAL ORDER NO.- 72439 / 2018 Per: Anil G. Shakkarwar The present appeal is directed against Order-in- Appeal No. NOI/CUSTM/000/APP/333/2014-15 dated 27/01/2015 passed by Commissioner of Central Excise & Customs (Appeals-II), Meerut Zone at Noida.

2. The brief facts of the case are that the appellants filed Bill of Entry No.5634075 dated 28.05.2014 with ICD, Loni, Ghaziabad and declared the goods imported as Iron scrap for melting weighing 24.950 MT, Aluminium Scrap of "Talk" 2 APPEAL No.C/52163/2015-CU[DB] variety weighing 15.670MT and Copper Scrap of "Birch" variety weighing 1.680MT. The value of the goods declared in the said Bill of Entry was Rs.43,59,684.40. The importer requested for first check examination. The examination was conducted and it was reported by shed officer that the quantity of aluminum "Talk" was found to be 15.460 MT and rest was Iron Scrap and some portion of Iron scrap was found to have Copper Scrap Birch attachment. It was further reported that random sample of Iron scrap with copper attachment was taken and Iron and Copper were separated with cutter for weighment and copper was found to be around 8%. The weight of the consignment was found to have 26.63 MTs of Iron and Copper mix and 15.460 MTs of Aluminum Scrap. It appeared to revenue that description and quantity of Iron and Copper scrap was different than declared and they were found to be in mixed form. It further appeared to revenue that Copper scrap was declared to be 1.68 MT whereas actually it was found to be 2.1304 MTs. Therefore, there was a proposal to issue a show cause notice to the appellant which was waived by the appellant through letter dated 03.06.2012. The matter was adjudicated through Order-in-Original dated 25.07.2014. The Original authority has held that for import of mixed scrap authorization from DGFT was required and also that the goods were found to be different than the 3 APPEAL No.C/52163/2015-CU[DB] description given in the Bill of Entry and therefore, there was mis-declaration and therefore, he has confiscated the imported goods under the provisions of Section 111 (m) and 111 (d) of Customs Act, 1962. Further, he has given option to pay fine of Rs.2.25 lakhs to redeem the goods. He further held that NIDB Data in respect of mixed scrap of Iron and Copper was not available and therefore he has adopted price of Iron and Copper available on London Metal Exchange and enhanced the value of 2.1304 MTs of Copper Scrap to Rs.8,11,883/- from Rs.6,25,968/- declared by the appellant. He further enhanced the value of Aluminium scrap on the bases of NIDB data to Rs.32,96,185/- from Rs.31,13,924.4/- declared by the importer. Aggrieved by the said order, appellant preferred appeal before the Commissioner (Appeals). The learned Commissioner (Appeals) has decided the appeal through the impugned Order-in-Appeal wherein he has stated that Larger Bench of this Tribunal has held in the case of Aarti Impex Vs CC reported in 2013 TIOL 1474 CESTAT-DEL that value can be enhanced adopting NIDB price data. He, therefore, did not interfere with the said Order-in-Original dated 25.07.2014. Aggrieved by the said order, appellant is before this Tribunal.

3. Heard the learned Counsel for appellant. He has submitted that they did not deliberately mis-declare the goods and may be that during transport Iron Scrap and Copper Scrap got mixed with each other. He, therefore, pleaded for setting aside confiscation. He further argued that this Tribunal in the case of M/s Shiva Alloys Pvt. Ltd. Vs Commissioner of Customs, ICD, TKD, New Delhi reported at 2006 (196) ELT 212 (Tri.-Del.) has held that London Metal Exchange Bulletin prices are not in accordance with the valuation provision and therefore they cannot be accepted for adopting valuation and that the prices, at the best only indicate about price variation. He has further submitted that the reliance by learned Commissioner (Appeals) on this Tribunal's decision in the case of Aarti Impex is not applicable because the learned Commissioner (Appeals) has described it as Larger Bench decision whereas no such Larger Bench was constituted to decide any such issue and that the conclusion drawn by the learned Commissioner (Appeals) that it was held through the final order in the said case that acceptance of NIDB data for enhancement of value is proper and legal is erroneous.

4. Heard the learned A.R. for revenue. He has supported the impugned Order-in-Appeal.

5. Having considered the rival contentions and on perusal of records, we find that in the case of M/s Aarti Impex (supra) there was no Larger Bench constituted and that there was difference of opinion between the Two Members and the difference was referred to Third Member. We find that the facts of the said case are that the importer in the said case imported various goods including ladies and gents footwear, socks and also watch batteries. The value of the same was enhanced on the bases of NIDB Data. The learned Judicial Member in para-6 of the Final Order has made following observations:-

"It is well settled law that for adopting the value of other imported goods, the same have to be matched in terms of country of origin, time of import, quality of goods and quantity of goods. No such effort seems to have been made by the lower authorities and no such comparison is available on record. The appellant have claimed that the batteries were procured on stock-lot basis. The said plea of the appellant does not stand rebutted by the Revenue, by production of evidence to the contrary. Further, we find that apart from enhancing the value on the basis of NIDB Data, no evidence stands produced on record to reject the invoice value. Further, there is no allegation or evidence to show that the importer has made extra payment to the foreign supplier, in addition to the value reflected in the invoice. As such, we find no justifiable reason to uphold the impugned orders. The same are accordingly set aside and appeal is allowed with consequential relief to the appellant."

The said finding was differed by Technical Member and as per para-15 of the said order, Technical Member has held that "the appeal deserves to be rejected in respect of batteries." He did not propose to reject the appeal in respect of other goods such as ladies and gents footwear and socks. Further, the point of difference in opinion recorded to be resolved by Third Member was as follows:-

"Whether the appeal is to be allowed as recorded by the Judicial Member or whether the appeal is to be rejected in respect of watch batteries as recorded by Technical Member."

We, therefore, find that in the said order of this Tribunal in the case of Aarti Impex (supra) no issue related to reliance to be placed on NIDB data for enhancement of value under the provisions of Section 14 of Customs Act, 1962, was made. Further, we find that this Tribunal in the above sated case of M/s Shiva Alloys Pvt. Ltd. (supra) has held that LME prices are, at best only indicative and are not final and conclusive, to enable relying upon the same for enhancement of value. We, therefore, allow appellant's appeal in so far as valuation aspect is concern. We restore the value declared by the appellant through the said Bill of Entry No.5634075 dated 28.05.2014. We find that in so far as declaration about goods was concerned the appellant 7 APPEAL No.C/52163/2015-CU[DB] declared that they imported 1.68 MTs of Copper Scrap whereas it was found that 2.1304 MTs Copper Scrap was imported and Copper and Iron Scrap were mixed, as found during examination. Therefore, we do not interfere with the impugned order, in so far as the same is concerned about mis-declaration, confiscation, imposition of redemption fine and penalty.

6. To conclude, the appeal is allowed on the issue of valuation and rest of the appeal is rejected.

(Pronounced in Court) (Justice Dilip Gupta) President (Anil G. Shakkarwar) Member (Technical) akp