2019 (6) TMI 221 - AT - Customs

Valuation of imported goods - Toyota Land Cruiser Prado - rejection of value under Rule 12 of Customs Valuation Rules, 2007 - Confiscation of imported vehicle - HELD THAT - The original adjudicating authority has simply rejected the value under Rule 12 of Customs Valuation Rules, 2007 but have not given any reasons for not proceeding sequentially as per Customs Valuation Rules, 2007 and particularly as to why the contemporaneous values as submitted by the appellants was rejected - Commissioner (A) has found that the invoice mentions the vehicle name, chassis number, engine number, model number etc. Therefore, the rejection of the invoice without proper basis is incorrect - the value arrived at by the authorities is not justified. Violation of the condition that the vehicle was to be in the possession of importer for a period of one year - HELD THAT - The importer has accepted that he has violated the provisions. For the same reason, the vehicle was seized and confiscated and however, the same was realized on payment of fine in lieu of confiscation. Once, the vehicle is allowed to be released on payment of fine in lieu of confiscation, the violations, if any, has been atoned. Appeal dismissed - decided against Revenue.

Issues Involved:
1. Valuation of imported vehicle and imposition of redemption fine and penalty.
2. Appeal filed by the Department regarding valuation and subsequent withdrawal under Litigation Policy.
3. Restoration of the Department's appeal by the Tribunal.
4. Rejection of the value declared by the importer and grounds for such rejection.
5. Violation of possession condition of the imported vehicle and subsequent penalties imposed.

Issue 1: Valuation of imported vehicle and imposition of redemption fine and penalty:
The case involved the importation of a "Toyota Land Cruiser Prado" by Shri Mohan Raman, where Customs Authorities proposed confiscation due to alleged violations related to possession and valuation of the vehicle. The lower authorities confirmed a value of &8377; 10,97,556/-, along with a redemption fine of &8377; 2,75,000/- and a penalty of &8377; 1,37,000/-. The Commissioner (A) accepted the value declared by Shri Mohan Raman but reduced the fine to &8377; 1,00,000/- and penalty to &8377; 50,000/-. The Department filed an appeal challenging the acceptance of the value, which was dismissed by the Bench as the Department withdrew the appeal under the Litigation Policy.

Issue 2: Appeal filed by the Department and subsequent restoration:
Following the dismissal of the initial appeal, the Department filed an application for Restoration of Appeal, arguing that the monetary limit prescribed for filing appeals before the CESTAT in customs matters was &8377; 10,00,000/- as per Board Instruction. The Tribunal, considering the Board's instruction, recalled its earlier order and restored the Revenue's appeal.

Issue 3: Rejection of the value declared by the importer:
The Department contended that the invoice did not contain essential details like CIF or FOB terms, purchase order details, payment details, and the specific model of the vehicle. They argued that the value was rejected under Rule 12 of Customs Valuation Rules, 1962, and a new value was determined considering additional factors like new tyres, upholstery, and other fittings. However, the respondents argued that they purchased the 2003 model car for 13,000 USD, including freight up to Cochin, and provided details of contemporaneous imports at different locations. The Commissioner (A) found the invoice details to be accurate and relied on precedents to support the acceptance of the declared value.

Issue 4: Violation of possession condition and penalties imposed:
Regarding the violation of the condition that the vehicle must be in the importer's possession for a year, the importer admitted the violation, leading to the seizure and proposed confiscation of the vehicle. However, the vehicle was released upon payment of a fine in lieu of confiscation. The Tribunal cited a previous case to emphasize that once the fine is paid, any violations are considered atoned for. Therefore, the Tribunal rejected the Department's contention regarding the possession violation.

In conclusion, the Tribunal upheld the Commissioner (A)'s decision to accept the declared value of the imported vehicle and rejected the Department's appeal. The restoration of the appeal by the Tribunal was based on the monetary limit prescribed for customs matters. The rejection of the declared value by the Department was found unjustified, and the penalties imposed for the possession violation were considered adequately addressed through the fine paid by the importer.

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