2018 (5) TMI 166 - AT - Customs

Valuation - imported Heavy Melting Scrap - enhancement of value on the basis of DoV data of similar goods - 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 - 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. The fact that the assessed bills of entries were challenged by the appellant before Commissioner (Appeals), by way of filing appeals, is itself indicative of the fact that the appellants were not satisfied with such enhancement and have exercised their right of appeal provided under the statute - 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. Enhancement of value without first rejecting the transaction value - Whether in view of the mis-declaration of the goods impacting the rate of duty and the value of the goods, the order of the Ld. Commissioner (Appeals) should be upheld and appellants appeal dismissed in Appeal No.C/60002/2016, C/60003/2016 and C/60006/2016, as held by Member (Technical) - difference of opinion - majority order. Held that - in Appeal nos. C/60002/2016 and C/60006/2016, the transaction value has not been rejected by Revenue, therefore, in those two appeals, I agree with the view expressed by Member (Judicial). In sofaras the Appeal No. C/60003/2016 is concerned, I find that the appellant had given consent for enhancement of value, therefore, I agree with the view expressed by Brother Member (Technical) - all the appeals except appeal No. C/60003/2016 are allowed and the said appeal no. C/60003 of 2016 is rejected.

Summary

Issues Involved:
1. Whether the 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.
2. Whether the enhancement of the value of imported goods without rejecting the transaction value is legally sustainable.
3. Whether the mis-declaration of goods impacts the rate of duty and the valuation of goods, justifying the application of higher duty and penalties.

Issue-wise Detailed Analysis:

1. Clearances of Goods and Right to Appeal:
The first issue revolves around whether paying customs duty on an enhanced value prevents the assessee from challenging the valuation later. The judgment clarifies that importers often clear goods by paying the enhanced duty to avoid demurrage and other expenses, and this does not preclude them from appealing the assessed value. The Tribunal referenced past decisions, such as Commissioner of Customs vs. Ganesh Trading Company and Bayshore Glass Trading Pvt. Limited vs. CC, Kolkata, which support the stance that payment under protest and subsequent filing of an appeal is valid. Thus, the act of paying the enhanced duty does not negate the right to challenge the assessment.

2. Enhancement of Value Without Rejecting Transaction Value:
The second issue concerns the legality of enhancing the value of imported goods without rejecting the declared transaction value. The judgment emphasizes that the transaction value should be accepted unless proven incorrect with tangible evidence. The Revenue did not provide evidence of underhand consideration or contemporaneous imports to justify the enhancement. Precedents such as Ventura Impex (P) Limited vs. CC (Import & General) and Peekay Steel Castings Pvt. Ltd vs. CC, Cochin were cited, underscoring that mere suspicion is insufficient to reject the transaction value. The Tribunal concluded that the transaction value must be adopted as the correct assessable value in the absence of such evidence.

3. Mis-declaration of Goods and Its Impact:
The third issue addresses whether the mis-declaration of goods affects the duty rate and valuation, justifying higher duties and penalties. The Member (Technical) highlighted specific cases (Appeal Nos. C/60002/16, C/60003/16, C/60006/16) where mis-declaration was accepted by the importers, impacting the duty rate and valuation. The application of higher duties and penalties was deemed correct in these cases. However, the Member (Judicial) disagreed, suggesting that the enhancement of value without rejecting the transaction value was unsustainable. The third member, Mr. Anil G. Shakkarwar, agreed with the Member (Judicial) for Appeal Nos. C/60002/2016 and C/60006/2016, but sided with the Member (Technical) for Appeal No. C/60003/2016 due to the appellant's consent for value enhancement.

Final Order:
In the majority decision, all appeals except Appeal No. C/60003/2016 were allowed, and Appeal No. C/60003/2016 was rejected. This resolution indicates that the enhancement of value without rejecting the transaction value was not upheld, except in cases where the importer explicitly accepted the enhanced value.