2018 (11) TMI 1767 - AT - Customs

Valuation of imported goods - Wooden Furniture - misdeclaration of weight of the furniture - allegation is that the appellant had suppressed the value of the goods to the extent of the weight less declared - demand of differential duty - Confiscation - penalty. HELD THAT - Undisputedly the appellant had imported wooden furniture of different varieties meant to be used in bedrooms and hall etc. While importing the said goods, the appellant had declared the classification of the product, under Chapter 9403 89 90 of CTA, 1975 which are assessable to duty as unit not by weight. Therefore, noticing excess weight at the time of physical verification of the import by the Customs authorities, could not in any manner change the transaction value disclosed in the proforma invoices, which has not been disputed by the Revenue. In these circumstances, loading the invoice price prorata basis to the extent of excess weight of the furniture noticed during the physical examination is unsustainable in law - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Appeal against Order-in-Appeal Nos. 22 to 24 (Gr.VI)/2011 (JNCH)/IMP/-14 to 16
- Allegation of suppression of value of goods based on weight discrepancy
- Confiscation of goods and imposition of penalty
- Classification of imported furniture under Chapter 9403 89 00
- Application of transaction value vs. weight for duty assessment

Analysis:
The appeal was filed against Order-in-Appeal Nos. 22 to 24 (Gr.VI)/2011 (JNCH)/IMP/-14 to 16, dated 20-1-2011, passed by the Commissioner of Customs (Appeals) Mumbai-II, JNCH, Sheva. The appellant had imported Wooden Furniture against Bills of Entry, declaring the assessable value based on the transaction price from the proforma invoice. However, discrepancies were found in the weight of the furniture declared in the Bills of Entry compared to the actual weight. This led to the allegation of suppressing the value of goods, resulting in the confirmation of differential duty on a pro rata basis, confiscation of goods, and imposition of a penalty. The appellant contended that the price was declared based on the unit-wise value of the furniture, not the weight, as the furniture was classifiable under Chapter 9403 89 00, with duty prescribed per piece, not by weight. The appellant cited relevant judgments to support their argument.

Upon review, the Tribunal noted that the appellant had imported wooden furniture classified under Chapter 9403 89 90, assessable to duty as a unit, not by weight. Despite the excess weight found during physical verification, the transaction value disclosed in the proforma invoices remained undisputed by the Revenue. Therefore, the Tribunal deemed loading the invoice price on a pro rata basis due to excess weight as unsustainable in law. Consequently, the impugned order was set aside, and the appeals were allowed with any consequential relief as per law.

In conclusion, the Tribunal's decision highlighted the importance of assessing duty based on the transaction value declared in the proforma invoice for goods classified under specific chapters, rather than altering it based on weight discrepancies observed during physical verification.