2013 (2) TMI 342 - AT - Customs

Waiver of pre-deposit - Stay of recovery - Duty, interest and penalty - Undervaluing the goods - Suppression of value of goods - Valuation under import of goods - Revenue argued that the importer and supplier are related person and the assessee had undervalued the good - Revenue is demanding duty at the price at which the goods are being traded in India after deducting the sales tax - Held that - Duty is being demanded on the basis of the sale price of traded goods in India without taking into consideration of the profit margin. The assessee had made out prima facie a strong case in their favour. Stay granted and waive pre-deposit

Summary

Issues:
- Waiver of pre-deposit of duty, interest, and penalty based on undervaluation of goods imported and traded by the applicant.

Analysis:
The appellant, a subsidiary of a German company, filed an application seeking waiver of pre-deposit of duty amounting to Rs. 2,05,908/-, interest, and penalty. The revenue alleged that the appellant undervalued the goods imported and traded to evade customs duty, as the importer and supplier were related parties. The revenue demanded duty based on the price at which the goods were traded in India, deducting the sales tax. The appellant contended that there was no evidence of undervaluation and argued that the revenue did not consider the profit margin of the traded goods, demanding duty at the selling price in India. The revenue, relying on lower authority findings, claimed that the price difference between goods sold in India and declared to customs showed undervaluation. The Tribunal observed that duty was demanded solely based on the sale price in India without considering the profit margin. Considering the facts, the Tribunal found the appellant had a strong prima facie case in their favor. Consequently, the pre-deposit of dues was waived, and recovery stayed during the appeal's pendency.