2017 (7) TMI 703 - AT - Customs

Classification of imported item - enhancement of declared value - mixed plain plastic film rolls of cuts/odd sizes - The claim of the importers in these appeals is that the imported goods are from stock lot, hence the lower transaction values - Held that - no evidence has been brought forth by the department to disprove such an averment or establish that these are not stock lots. In fact, there is no corroborative evidence of any sort, in the form of documents or any other evidence unearthed from the supplier s end to hold up the allegations of the department. The Custom Valuation Rules will operate only when there is a dispute or a doubt on such transaction value. These rules provide for the manner and method of determining the assessable value in different circumstances. Evidently, such proceduralities are enjoined to eliminate any adhocism or arbitrariness while determining one an enable value. Value of identical imported goods can very well have different transaction values depending on whether the imports are a one time transaction or are one in a series of continuous imports, whether the goods are from a prime lot or stock lot and so on. Appeal dismissed - decided against Revenue.

Summary

Issues:
1. Classification of imported goods as BOPP film.
2. Enhancement of assessable values and demand of differential customs duty.
3. Imposition of penalties under various sections of the Customs Act, 1962.
4. Appeals filed by the department against the decisions of the Commissioner (Appeals).
5. Allegations of under-valuation and mis-declaration of goods by the importers.

Classification of Imported Goods as BOPP Film:
The case involved imported goods declared as "mixed plain plastic film rolls" but were suspected by the department to be BOPP film attracting higher value. The original authority reclassified the goods as BOPP film under a specific classification, leading to enhanced assessable values and differential customs duty demands.

Enhancement of Assessable Values and Demand of Differential Customs Duty:
The adjudication proceedings resulted in the enhancement of declared assessable values, reclassification of goods as BOPP film, and the imposition of consequential demands of differential customs duty along with interest. Additionally, redemption fines and penalties were imposed on the importers and their directors under various sections of the Customs Act, 1962.

Imposition of Penalties under Customs Act, 1962:
Penalties were imposed on the importers and their directors for under-valuation and mis-declaration of goods. The penalties were levied under sections 112(a), 114A, and 125 of the Customs Act, 1962. The penalties were challenged by the importers in appeals before the Commissioner (Appeals).

Appeals Filed by the Department:
The department filed appeals challenging the decisions of the Commissioner (Appeals) who had allowed the appeals of the importers based on the grounds of lack of evidence to support the allegations of under-valuation. The department argued that the importers had falsely declared the goods as stock lots and had resorted to mis-declaration to evade customs duty.

Allegations of Under-Valuation and Mis-Declaration:
During the hearing, the department reiterated that the importers' explanation of the goods being stock lots was false. The department contended that the importers should have described the goods more accurately for proper classification under the Customs Tariff. The department also accused the importers of under-valuation and mis-declaration to evade customs duty, holding the directors personally liable for penalties under the Customs Act, 1962.

In the final judgment, the Tribunal reviewed the evidence and procedural aspects related to customs valuation. It noted the lack of evidence presented by the department to disprove the importers' claims of the goods being stock lots. The Tribunal emphasized the importance of following the Customs Valuation Rules to determine assessable values accurately. Ultimately, the Tribunal found no merit in the department's appeals and dismissed them, upholding the decisions of the lower appellate authority.