Custom, Excise & Service Tax Tribunal
Refex Refriegerants Ltd vs Commissioner Of Customs ... on 6 September, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH CHENNAI Appeal No. C/292/2008 [Arising out of Order-in-Original No.7650/2008 dt. 01.05.2008 passed by the Commissioner of Central Excise (Appeals), Chennai] Refex Refriegerants Ltd. Appellant Versus Commissioner of Customs (Seaport-Import) Chennai Respondent
Appearance:
Shri A.K. Jayaraj, Advocate For the Appellant Shri K. Veerabhadra Reddy, JC (AR) For the Respondent CORAM :
Honble Ms. Sulekha Beevi C.S. Member (Judicial) Honble Shri B. Ravichandran, Member (Technical) Date of hearing / decision : 06.09.2017 FINAL ORDER No. 41993 / 2017 Per B. Ravichandran The appellant is aggrieved by the order dt. 1.5.2008 of Commissioner of Customs (Seaport-Import), Chennai. They have filed six Bills of Entry from 17.10.2006 to 02.03.2007 for clearance of "Refrigerant 134A (Tetrafluoroethane)". The declared value varied from Rs.56/- to Rs.167/- for different Bills of Entry. The goods were assessed and cleared. Later, show cause notice cum demand was issued to reassess the said Bills of Entry and pay the demand of differential customs duty on the ground that value was not correctly declared. The Revenue proceeded on the ground that similar goods imported through Nhava Seva Customs was assessed and cleared with unit price of Rs.141/- to Rs.230/- during the material time. The notices were adjudicated resulting in the impugned order. The original authority rejected the earlier assessed value of Rs.1,14,40,872/- and reassessed the same to Rs.1,99,33,560/-. Accordingly, differential Customs duty of Rs.38,76,906/- was confirmed against the appellant. A penalty of Rs.10 lakhs was imposed on them under Section 112 (a) of the Customs Act.
2. The Ld. counsel appearing for the appellant contested the findings mainly on two grounds. Firstly, he submitted that the rejection of transaction value was not legal and proper as nothing on record was brought to disprove the value as per the contract and invoices submitted at the time of original assessment. The rejection is only based on certain imports through Nhava Seva. Secondly, he submitted that the legal provisions of Customs Valuation Rules, 1988 were not followed the by the authorities. There is a summary finding of inapplicability of Rule 4, 5, 6, 7 & 7A of the said Rules. The assessments were made after redetermination of value under Rule 8. The ld. counsel contested that even for Rule 8 proper appreciation of facts are required. Despite of request, the authorities did not provide the supporting documents like invoices, nature of goods imported which was sought to be compared to reassess their valuation. He relied on the decision of the Tribunal in Vidya Enterprises Vs CC (Seaport-Export), Chennai vide Final Order No.41093/2017 dt. 22.06.2017 and Vijaya International Impex Vs CC (Seaport-Import), Chennai vide Final Order No.41093/2017 dt. 22.06.2017.
3. The Ld.A.R opposed to the appeal and submitted that the original authority discussed the reason for rejection of transaction value elaborately in his order. The documents submitted by the appellant regarding payment for consideration for import items were found to be not tallying with the purchase order and there were serious questions about the transaction value with the exporter based on high sea sales. There was sufficient justification to reject the value declared by the importer and to adopt the value of similar goods imported through Nhava Seva during the material time by invoking Rule 8 of the Valuation Rules. He submits that there is no legal infirmity in the impugned order and prays for rejection of appeal.
4. We have heard both sides and perused appeal records. The assessment of cleared goods was sought to be reassessed based on certain data of the import through Nhava Seva Customs. We have perused the documents submitted by the appellant and also the impugned order correctly. Admittedly, the price of the impugned goods are widely varying even on month to month basis. This is evident even from the proposal made by the Revenue for reassessment. The value proposed was Rs.189/- per kg for October 2006 to December 2006, Rs.141/- per kg for February 2007 and March 2007 and Rs.230/- per kg for imports made in January 2007. Apparently, there is a variation of more than 50% in a matter of few months in respect of the impugned goods. This apart from lack of full details regarding the importation made through Nhava Seva on various parameters like whether the value is with reference to branded or unbranded item, quality, terms of contract, payment schedule and also whether such assessments were themselves enhanced assessments. It is necessary even to reassess under Rule 8 to have justifiable reasons. In the present case, the reason being contemporaneous import of similar goods through other port, in such situation full particulars of other imports are to be examined and made available to the appellant also. In view of non-fulfilment of such requirement, reassessment order suffers from serious infirmity. We also refer to decisions relied upon by the appellant involving similar set of facts before the Tribunal. The Tribunal observed that it is a settled position of law that in terms of Section 14 of Customs Act, 1962, the transaction value is required to be accepted. The valuation relating to Valuation Rules can only be done when the transaction value is rejected for valid reasons. Relying on the decision of Hon'ble Supreme Court in Eicher Tractors Ltd. Vs CC Mumbai - 2000 (122) ELT 321 (SC), the Tribunal held that transaction value cannot be rejected on the basis of availability of data value for contemporaneous import of similar goods. This may at best raises a suspicion on the transaction value but cannot form basis for refixing the value.
5. In view of the above discussions and analysis, we find that the impugned order failed to justify reassessment with legal basis. Accordingly, the same is set aside. Appeal is allowed with consequential relief, if any, as per law.
(dictated and pronounced in court)
(B. Ravichandran) (Sulekha Beevi C.S)
Member (Technical) Member (Judicial)
gs
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Appeal No.C/292/2008