2016 (11) TMI 300 - AT - Customs

Valuation - export of goods - disagreement between the declared rate on final commercial invoice and the shipping bills - unit rate declared in the final commercial invoice is USD 166 PDMT CIF for Fe content 63.00%, basis against declared unit rate of USD 173 PDMT CFR for Fe content 62.00%, basis in the shipping bills, as per the original contract - whether the order of adjudicating authority of finalisation of subject shipping bill by adopting initially declared unit price of USD 173 against finally invoiced rate of USD 166 justified? - Held that - the grounds raised by the department have been taken cognizance of by the Commissioner (Appeals) and the order passed by him is well reasoned. When the department accepts the BRC, as well as the final invoice of the exporter and has no doubt or dispute that amount other than what was reflected in final invoice was not received by the latter, the BRC has to be given credibility and reliance. This being so we do not find any infirmity in the impugned order - appeal dismissed - decided against department.

Summary

Issues:
1. Discrepancy in unit price declared in shipping bill and final commercial invoice.
2. Adjudication order for finalization of shipping bill and refund of balance revenue deposit.
3. Reckoning Bank Realization Certificate (BRC) for assessable value determination.
4. Appeal against the order of Commissioner (Appeals) by the department.
5. Credibility and reliance on BRC and final invoice.

Analysis:

1. The case involved a discrepancy in the unit price declared in the shipping bill and the final commercial invoice. The exporter declared a unit price of USD 173 DMT CFR in the shipping bill, while the final commercial invoice showed a unit rate of USD 166 PDMT CIF. This difference raised concerns as it was not in line with the original contract, and no amendment to the contract was made.

2. The adjudicating authority, in an order dated 09.12.2011, finalized the subject shipping bill by adopting the initially declared unit price of USD 173. Additionally, a refund of the balance revenue deposit amount and adjustments for Fe content and moisture variation were ordered. The Commissioner (Appeals) later upheld the decision, emphasizing the importance of the Bank Realization Certificate (BRC) in determining the assessable value.

3. The Commissioner (Appeals) held that in the absence of substantial evidence, the BRC should be considered for assessing the value. The department, dissatisfied with this decision, appealed the matter. During the proceedings, the department reiterated its grounds of appeal, while the appellant's representative argued that the Commissioner (Appeals) had made a fair decision that did not warrant interference.

4. The appellate tribunal found that the department's concerns had been addressed by the Commissioner (Appeals), and the decision was well-reasoned. Given that the department accepted the BRC and final invoice without dispute, the BRC was deemed credible and reliable. Consequently, the tribunal upheld the Commissioner (Appeals)'s order and dismissed the department's appeal.

5. The tribunal concluded that there was no infirmity in the impugned order, and therefore, the department's appeal was dismissed. The decision was pronounced in court at the conclusion of the hearing, bringing the case to a close.

This detailed analysis of the judgment highlights the key issues, decisions, and arguments presented in the case before the Appellate Tribunal CESTAT HYDERABAD.