2013 (3) TMI 401 - AT - Customs

Rejection of Transaction value under Section 14 of the Customs Act - Absence of documentary evidence - Contractual price under Section 14 of the Customs Act - Rule 4(2) of the Customs Valuation Rules - Confiscation or Penalty - Fine in lieu of confiscation of the goods - Held that - the declared price cannot be rejected except on any of the grounds particularized under Rule 4(2) of the Customs Valuation Rules - no such ground having been stated in these appeals. - There is no question of confiscation or penalty in respect of any of the respondents. We find that the show cause notice alleged that M/s. Standard Industries Ltd. along with others misdeclared the value of the goods so as to evade Customs duty. It was alleged that the dates of bills of lading were misdeclared thereby rendering the goods liable to confiscation under Section 111(m) of the Customs Act. The adjudicating authority did not record any finding of misdeclaration of value as against M/s. Standard Industries Ltd. and the appellant has not raised any ground against this. In the circumstances, the plea for imposing a fine in lieu of confiscation of the goods cannot be granted. Needless to say that the prayer for imposing penalty on the above company is also not liable to be allowed. - Decided against the revenue.

Issues Involved:
1. Acceptance of declared value of imported goods.
2. Imposition of redemption fine and penalty on importers.
3. Allegations of discriminatory attitude by the department.
4. Validity of contractual price versus PLATT price for valuation.
5. Alleged manipulation of bill of lading dates.

Detailed Analysis:

1. Acceptance of Declared Value of Imported Goods:
The department's appeals challenge the Commissioner's acceptance of the declared value of furnace oil by several importers. The Commissioner accepted the value declared by M/s. Standard Industries Ltd. and other importers based on the contractual price agreed with their suppliers. The department proposed to enhance the value based on the "average PLATT price" and contemporaneous imports, alleging misdeclaration to evade customs duty. The Commissioner, however, found no valid grounds to reject the transaction value under Section 14 of the Customs Act. The declared value was accepted for Angel Overseas Pvt. Ltd., Shree International Trading Co., Progressive Petroleum Co., and Solar Tradelinks Pvt. Ltd. The department's contention that the Commissioner should have used the PLATT price was not upheld, as no valid ground against the acceptance of the contractual price was found.

2. Imposition of Redemption Fine and Penalty on Importers:
The department appealed for the imposition of fine and penalty on M/s. Standard Industries Ltd., arguing that once misdeclaration was found, the importer should be penalized under Section 112 and redemption fine should be imposed under Section 125 of the Customs Act. The Commissioner had refrained from imposing any fine or penalty, and this decision was challenged. However, the adjudicating authority did not record any finding of misdeclaration of value against M/s. Standard Industries Ltd., and the department did not raise any substantial ground against this finding. Consequently, the plea for imposing a fine and penalty was not granted.

3. Allegations of Discriminatory Attitude by the Department:
The respondents raised a preliminary objection, claiming that the department's decision to not file appeals against other importers indicated a discriminatory attitude. The tribunal held that this forum was not appropriate to challenge the Commissioner's order on the grounds of discrimination. The focus remained on the department's challenge to the Commissioner's decision vis-`a-vis the respondents in the current appeals.

4. Validity of Contractual Price versus PLATT Price for Valuation:
The Commissioner preferred the contractual price over the PLATT price for determining the assessable value of the goods. The department argued for the PLATT price, but the tribunal found no valid ground to reject the contractual price under Section 14 of the Customs Act. The declared price could not be rejected except on grounds specified under Rule 4(2) of the Customs Valuation Rules, which were not substantiated in the appeals. Hence, the Commissioner's acceptance of the contractual price was upheld.

5. Alleged Manipulation of Bill of Lading Dates:
The department alleged that the dates on the bills of lading were manipulated to help importers declare a lesser price for evading customs duty. The SDR presented various documents to support this claim, but the Commissioner had already considered these documents and found no grounds to reject the transaction value. The tribunal noted that the controversy regarding the manipulation of bill of lading dates existed for other importers as well, but the Commissioner's observations about the PLATT price held good for all importers.

Conclusion:
The tribunal dismissed all the appeals, upholding the Commissioner's order in accepting the declared value of the goods and refraining from imposing fines or penalties. The decision was pronounced in court, affirming the validity of the contractual price over the PLATT price and rejecting allegations of misdeclaration and manipulation of bill of lading dates.

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