2009 (4) TMI 766 - AT - Customs

Valuation (Customs) - Undervaluation - Polyester knitted fabrics imported at the price US 1.4 per kg. - Department relied on NIDB data which followed benchmark price at US 2.50 per kg - Price cannot be enhanced merely on the basis of benchmark price without stating any reason for rejecting transaction value

Summary

The Appellate Tribunal CESTAT NEW DELHI, consisting of Shri M. Veeraiyan and P.K. Das, JJ., heard an appeal filed by the Revenue against Final Order No. 188/NS/GGN/06 dated 30-6-06 by the Commissioner (Appeals) that set aside the enhancement of value on a consignment of polyester knitted fabrics. The respondents imported the fabrics, declared at US $ 1.4 per kg, but the assessing officer increased the value to US $ 2.5 per kg, which the respondents paid under protest. The Commissioner (Appeals) overturned the enhancement, prompting the Revenue to file the appeal. The Revenue argued that the Commissioner (Appeals) did not properly examine the issue, citing NIDB data indicating the value of knitted fabrics at US $ 2.5 per kg. However, the Tribunal found that the respondents paid duty under protest, as evidenced by the TR-6 challan, and that the Commissioner (Appeals) correctly followed the decision of the Hon'ble Supreme Court in Eicher Tractors Ltd. v. Commissioner of Customs, which stated that transaction value cannot be rejected without clear and cogent evidence. The Tribunal noted that the price could not be enhanced solely based on benchmark price without any reason for rejecting transaction value, and that the NIDB data relied on by the Revenue followed the benchmark price. Consequently, the Tribunal upheld the Commissioner (Appeals) decision, rejecting the Revenue's appeal.