2017 (12) TMI 175 - AT - Customs

Valuation of imported goods - Alloy Wheels as also Car Truck tyres of various brands - rejection of declared value - whether clearances of goods by paying customs duty on the higher enhanced assessable value, precludes the assessee from challenging the same before the higher appellate forum? - Held that - It is a matter of common experience that the importers, clear the goods, by payment of duty on the enhanced value, inasmuch as the goods imported by them are required and cannot be allowed to be retained by the Customs as the same incurr demurrage and other expenses. It is again a fact of common knowledge that settlement of dispute take years and the imported goods cannot be allowed to be deteriorated in quality till the final out-come of the dispute - Inasmuch as the goods imported by the appellant were required in the assessee s factory, the same were cleared by them on payment of the duty on enhanced value and this fact by itself cannot be adopted as a ground for resolving the disputed issue of valuation - payment of duty at the enhanced value and clearance of the goods in urgency cannot preclude the assessee from challenging the assessed bill of entry on the sole ground that goods stand cleared at the enhanced value. Valuation - enhancement of value - Held that - Revenue has not adduced any evidence to show flow of any under hand consideration to the supplier of the goods - As per the settled law, the transaction value has to be adopted as correct assessable value for the purposes of payment of duty unless the same is proved to be incorrect, on the basis of positive and tangible evidences - transaction value has to be adopted as the correct assessable value. Appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Rejection of declared value by Revenue without providing reasons.
2. Appellant challenging the re-determined value by Revenue.
3. Legal implications of clearing goods by paying duty on enhanced value.
4. Validity of enhancing value without rejecting transaction value or providing evidence.
5. Precluding the assessee from challenging assessed bill of entry due to clearance of goods at enhanced value.

Analysis:
1. The judgment involves the issue of the Revenue rejecting the declared value without providing reasons. The appellant imported Alloy Wheels and Car Truck tyres, declaring their value, which was enhanced by the assessing officers. The appellant contended that the Revenue rejected the declared value without any basis or evidence, leading to the enhancement of value without reference to contemporaneous imports. The Commissioner (Appeals) requested reasons for rejection, which were provided based on contemporaneous import data and quality considerations. However, the Commissioner (Appeals) observed that since the appellant accepted the enhanced value and cleared the goods without challenging it, their appeals were rejected.

2. The second issue pertains to the appellant challenging the re-determined value by the Revenue. The Tribunal disagreed with the Commissioner (Appeals) and held that clearing goods at an enhanced value does not preclude the appellant from challenging it before the appellate forum. The Tribunal cited precedent decisions emphasizing that payment of duty at an enhanced value under urgency does not waive the right to challenge the assessed bill of entry. It was noted that the Revenue failed to provide evidence to disprove the correctness of the transaction value, which should be accepted unless proven incorrect with tangible evidence.

3. The legal implications of clearing goods by paying duty on an enhanced value were discussed. The Tribunal highlighted that clearing goods urgently does not prevent challenging the valuation later. The Tribunal referred to previous cases where the filing of an appeal itself constitutes a protest against the assessed value, and payment of duty under urgency does not bar the importer from challenging the assessment.

4. The validity of enhancing value without rejecting the transaction value or providing evidence was analyzed. The Tribunal emphasized that the transaction value should be accepted unless proven incorrect with tangible evidence. It was noted that the Revenue did not produce evidence to justify the enhancement based on contemporaneous imports, as required by law. The Tribunal cited various decisions supporting the principle that doubts by the Revenue are not sufficient to reject the transaction value without concrete evidence.

5. The issue of precluding the assessee from challenging the assessed bill of entry due to clearing goods at an enhanced value was addressed. The Tribunal held that the impugned orders were not sustainable as the Revenue failed to provide evidence to support the enhancement of value. Therefore, the appeals were allowed, providing relief to the appellants and setting aside the impugned orders.