2016 (12) TMI 1204 - AT - Customs

Valuation - rejection of value based on contemporaneous imports - Rule 8 - Held that - The reliance placed for enhancing the value seems to be incorrect as the prices of the same product during May, 2004 may not be the same in January, 2005 - Secondly, for rejecting the declared price reliance was placed on the imports made in May, 2004 while arriving at the conclusion of under valuation, the adjudicating authority as well as the first appellate authority relied upon imports during January, 2005 to March, 2005. This would indicate for rejecting the transaction value during January, 2005 there was no data available as the data was relied upon in the Order-in-Original was of April, 2005 was not indicated to the importer - Thirdly, on perusal of details of contemporaneous imports as relied upon by the adjudicating authority to enhance the value from 2.4/Kg to 3.18/Kg., is also on wrong footing as the details lack the quantity of imports, the country of origin and manufacturer of the goods - the same cannot be held as contemporaneous imports to reject the value declared by the appellant-importer - appeal allowed - decided in favor of appellant-assessee.

Summary

Issues:
Valuation of imported goods based on declared price vs. contemporaneous imports.

Analysis:
The appeal challenged an Order-in-Appeal regarding the valuation of imported Viscose filament yarn. The appellants declared a price of US$2.4 per Kg for goods of Chinese origin, while the authorities considered the prevailing price to be higher at US$3.18/Kg. The lower authority provisionally enhanced the value to $2.90/Kg due to discrepancies in the declared price. Subsequently, the appellants filed more entries at the same declared price. The authorities rejected the declared value based on similar goods imported at a higher price and cited tribunal decisions to support their decision. The appellants argued that they received a special price under unique circumstances. The first appellate authority upheld the rejection of the declared value.

The main contention was the comparison of the declared price with contemporaneous imports. The appellant argued that the import details provided by the authorities did not specify quantity and country of origin, affecting the comparison's accuracy. The Departmental Representative highlighted the significant price difference between the appellant's declared value and contemporaneous imports, leading to the rejection of the declared value. Reference was made to a Supreme Court decision to support this stance.

Upon review, the Tribunal found that both the lower authority and the first appellate authority incorrectly applied the doctrine of contemporaneous imports. They noted discrepancies in the reliance on import data from different periods and the lack of crucial details in the contemporaneous import information provided. The Tribunal concluded that the rejection of the declared value was unjustified due to the improper application of the doctrine of contemporaneous imports. Consequently, the impugned order was set aside, and the appeal was allowed.