2016 (1) TMI 1211 - AT - Customs

Valuation - rejection of declared value - Held that - the importer appellant has not been able to justifiably explain the difference in the basic price (excluding the accessories, when subject goods viz. cars are identical), not considering the accessories of steel items attached with the goods in question - The lower authorities have considered the basic price and secondly, the exchange rate fluctuation do not justify the existing price difference. The appellant also mentions that difference in ex-works price of particular AUDI car was subject to the prevailing cost of production, transportation charges, existing tax structure for export - The appellant has not been able to give proper accountal of such difference(s) in the prevailing cost of production , transportation charges, existing tax structure for export etc. during the relevant period - appeal dismissed - decided against appellant.

Summary

Issues:
1. Customs valuation rules interpretation and application.
2. Justification of declared value by the appellant.
3. Discrepancies in the valuation of imported goods.
4. Comparison of prices and accessories of identical goods.
5. Compliance with customs regulations and documentation.

Analysis:
1. The appellant contested the order-in-appeal, challenging the rejection of the declared value of the imported car by the Deputy Commissioner. The appellant argued that the cars in question, of different manufacturing years, cannot be considered identical goods based on their chassis numbers, thus questioning the valuation under Rule 4 of the Customs Valuation Rules, 2007. The appellant also highlighted the manufacturer's explanations regarding price differences, emphasizing the non-consideration of these factors by lower authorities.

2. The appellant asserted that the declared value in the invoice reflected the true transaction value, meeting the requirements of Section 14(1) of the Customs Act, 1962. It was argued that the transaction was valid, not falling under any exceptions specified in Rule 4(2) of the Customs Valuation Rules, 2007. Additionally, the appellant emphasized the absence of evidence supporting undervaluation allegations and the proper remittance of payment through standard banking channels.

3. The Revenue, represented by the ld. AR, supported the findings of the lower Revenue authorities, maintaining the stance taken in the impugned orders. However, after evaluating the submissions and case laws cited by both parties, the Tribunal found that the appellant failed to adequately explain the price variances, especially concerning accessories and exchange rate fluctuations. The Tribunal noted discrepancies in the appellant's justifications and the lack of detailed accounting for cost differences.

4. The Commissioner (Appeals) scrutinized the comparison of values between the impugned car and a previously imported identical car, emphasizing the substantial price difference and the appellant's failure to justify it adequately. The Commissioner highlighted discrepancies in basic prices and accessories, noting the insufficient explanation provided by the appellant regarding production costs, transportation charges, and tax structures affecting the price disparity.

5. Ultimately, the Tribunal upheld the impugned order, dismissing the appeal due to the appellant's inability to satisfactorily explain the price variations and accessory differences. The Tribunal concluded that the cited case laws were not directly relevant to the circumstances of the case, affirming the decision based on the observations and discussions presented in the impugned order. The judgment was pronounced on 6.1.2017.