2017 (10) TMI 220 - AT - Customs

Misdeclaration of description of imported goods - goods described as Colored Self Adhesive Paper tape under Chapter heading 48114900, whereas the goods were found to be radium tape Fluorescent Tape under Chapter Heading 3919 - rejection of Declared value - enhancement of value based on contemporaneous imports - Held that - the Ld. Commissioner (Appeals) in his order upheld the charge of mis-declaration of the description of the goods but concluded that the rate of duty is same under the CTH 3919 and CTH 4811 - Ld. Commissioner (Appeals) has rightly rejected the enhancement value based on the proforma invoice which was the main foundation for enhancing the value in the adjudication order. From the submissions and documents placed on record by Ld. AR, it has become clear that there was no invoice at the rate of US 114.00 and there was only proforma invoices on the basis of which the value was enhanced by the adjudicating authority. Hence, the Ld. Commissioner (Appeals) has correctly concluded that the Department has not been able to adduce any evidence of contemporaneous import to support the value determined by the adjudicating authority. Appeal dismissed - decided against Revenue.

Summary

Issues:
Mis-declaration of goods, valuation based on proforma invoice, enhancement of value, rejection of invoice value, customs duty, penalties under Customs Act, 1962.

Mis-declaration of Goods:
The case involved a bill of entry filed for the import of colored self-adhesive paper tape, which was later found to be radium tape 'Fluorescent tape.' The goods were intercepted and found to be mis-declared, leading to a show cause notice for confiscation, value enhancement, and customs duty demand. Statements were recorded, market inquiries conducted, and samples sent for analysis. The investigation revealed discrepancies in the declared goods, leading to penalties imposed on the appellants and other individuals.

Valuation Based on Proforma Invoice:
The Revenue contended that the goods were mis-declared to suppress their actual value, and the transaction value could not be accepted. The department relied on a proforma invoice showing a higher value per roll compared to the declared value. However, the Advocate for the respondents argued against enhancing the value based solely on the proforma invoice, citing various case laws to support their stance.

Enhancement of Value and Rejection of Invoice Value:
The Ld. Commissioner (Appeals) upheld the mis-declaration charge but noted that the duty rate was the same for both the declared and actual goods. The valuation was based on contemporaneous imports and market inquiries, leading to an assessed value for duty calculation. The appellant objected to the valuation method and reliance on the proforma invoice, stating that it was not an actual invoice and lacked evidence of actual import matching the quantity and quality mentioned.

Customs Duty and Penalties under Customs Act, 1962:
The adjudication resulted in the enhancement of the value of imported goods, confiscation, auction, and penalties imposed on the appellants and other individuals under Sections 112, 114 AA of the Customs Act, 1962. The Ld. Commissioner (Appeals) rejected the value enhancement based on the proforma invoice, as the department failed to provide evidence of contemporaneous import to support the enhanced value determination.

Judgment:
After hearing both parties and examining the records, the Tribunal found that the appeal by the Revenue lacked merit and was thus dismissed. The Tribunal upheld the decision of the Ld. Commissioner (Appeals) in rejecting the enhancement of value based on the proforma invoice, highlighting the lack of evidence supporting the value determined by the adjudicating authority. The appeal filed by the Revenue was dismissed, and the original order was upheld.

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