2018 (7) TMI 35 - AT - Customs

Valuation of imported goods - high melting scrap and light melting scrap - enhancement of value based on NIDB data - the bills of entry of the appellant, which initially were 320 in No. and later were reduced to 208 have been held by the Department to be under valued and differential duty has been demanded, which otherwise has been paid by the appellant - whether NIDB Data has rightly been relied upon by the Revenue - Section 14 of the Customs Act, 1962. Held that - According to sub-rule (1) thereof the transaction value are required to be accepted for the purpose of the charging the Customs duty except in the cases where such value is rejected in accordance of sub-rule (2) thereof. In the present case except for NIDB Data Department has no contemporaneous evidence to reflect the correct price. No doubt proviso (iii) to Section 14 of sub-section (1) provides a situation where the proper officer has a reason to doubt the truth or accuracy of the transaction value and the bill of entry can be rejected. However, simultaneously, it is also provided that in case of doubt, the price shall be calculated with reference to the rate of exchange, as in force, on the date on which the bill of entry is presented under Section 46 - Apparently and admittedly, there is no such comparison on the part of the Department. The Dy. Commissioner, vide its order dated 1st May, 2017 himself had appreciated that the NIDB Data for the relevant period did not reflect the correct value of the imported goods, since NIDB Data reflects the prices after a lapse of more than a month from the current date. Therefore, complete reliance on NIDB Data for assessment of metal scrap is not proper. Recently in Kuber India vs. CC, Jaipur 2016 (8) TMI 141 - CESTAT NEW DELHI it was observed that rejecting transaction value by merely saying that it does not represent correct value and seems to be on lower side without any findings on contemporaneous imports, is not legally sustainable - In the present case also, Revenue has not brought any finding on the contemporaneous imports, it is not the Revenues case that any proviso to Section 14(1) of Customs Act are available in the present case. Whether the deposit of the differential duty by the appellant amounts to the acceptance of enhanced value on his part? - Held that - The fact that the assessment of bills of entries were challenged by the appellant before Commissioner (Appeals) by way of filing appeals, is itself indicator of the fact that appellants were not satisfied that such enhancement and have exercised their right of appeal provided under the statute - reliance placed in the case of Commissioner of Customs vs. Ganesh Trading Co. 2014 (1) TMI 64 - CESTAT NEW DELHI , where it was held that payment of duty at the enhanced value and clearance of goods in urgency cannot exclude or preclude the assessee form challenging the assessed bill of entry on the sole ground that goods stand cleared at the enhanced value - Appellants are held entitled for the refund of the differential duty paid by them in accordance of the relevant rules in this regard. Appeal allowed.

Summary

Issues:
Appeal against order of Commissioner (Appeals) dated 31st October, 2017 regarding under-valuation of imported goods and differential duty charged.

Analysis:
The appellant, an importer, filed 200 bills of entry for clearance of imported goods, which were classified under Chapter heading 7204 4900 of the Customs Tariff Act, 1975. The Assessing Officer found the value of the goods to be lower than the value in the National Import Database (NIDB), leading to reassessment and payment of differential duty. The Commissioner (Appeals) partly allowed the appeal, leading to the present appeal challenging the decision (Para 2).

The main argument revolved around the reliance on NIDB Data by the Department for under-valuation claims. The appellant contended that NIDB Data alone was insufficient for rejecting the bills of entry and that the re-assessment lacked proper reasoning or consideration of special circumstances under Section 14 of the Customs Act. The Deputy Commissioner acknowledged the limitations of NIDB Data, and the reliance on it was deemed unreasonable by the Tribunal (Para 3-6).

Regarding the acceptance of enhanced value by the appellant through payment of differential duty, the Tribunal noted that such payment does not imply acceptance of the value and does not preclude the right to challenge the assessment. Citing precedents, the Tribunal held in favor of the appellant, allowing the appeal, rejecting the re-assessment, and ordering a refund of the paid duty (Para 7-8).