2009 (1) TMI 709 - AT - Customs

Valuation of imported goods - Sealed Acid Batteries - Enhancement of value - appeal before Commissioner (Appeals) - maintainability of appeal

Summary

Issues:
- Appeal against Order-in-Appeal No. IND-I/493/2005 dated 5-12-05 regarding enhanced value of imported Sealed Acid Batteries from China.
- Maintainability of appeal before Commissioner (Appeals) by Revenue.
- Acceptance of enhanced value by the importer.
- Justification of enhancing value based on NIDB data and contemporaneous import price.
- Validity of Commissioner (Appeals) setting aside the enhanced value.
- Consideration of different varieties of batteries in import valuation.

Analysis:
The appeal before the Appellate Tribunal CESTAT, New Delhi involved a dispute over the enhanced value of 22,600 pieces of Sealed Acid Batteries imported from China. The Revenue challenged the Order-in-Appeal, arguing that the importer had accepted the enhanced value and paid duty, making the appeal before Commissioner (Appeals) not maintainable. The Revenue relied on Circular No. 91/2003 and various tribunal decisions to support its stance that the invoice value is not binding. However, the respondent contended that they did not accept the enhanced value, and the urgency of paying duty should not waive their right to appeal, citing relevant tribunal decisions in their favor.

Upon examination, the Tribunal noted an endorsement on the bill of entry indicating the importer's agreement to the enhanced rate, but found no evidence that the basis of value enhancement was disclosed. The Tribunal disagreed with the Revenue's assertion that the importer accepted the enhanced value, emphasizing that the Commissioner (Appeals) had set aside the enhanced value after a thorough review. The Tribunal highlighted the Commissioner's findings, which questioned the justification for enhancing the value without valid reasons, especially considering different varieties of batteries imported and mutually agreed prices with the manufacturer.

The Tribunal upheld the Commissioner (Appeals) decision, noting that the Revenue failed to refute the findings regarding the unreasonable enhancement of value for different battery varieties. The Tribunal concluded that the adoption of enhanced prices for all battery categories based on NIDB data was unjustified, leading to the rejection of the Revenue's appeal. The judgment highlighted the importance of valid reasons for rejecting declared values and the consideration of specific circumstances in import valuation disputes, ultimately affirming the Commissioner (Appeals) decision in favor of the respondent.