2008 (1) TMI 84 - AT - Customs

On basis of unsigned invoice, Revenue proceeded against assessee for undervaluation - import of broodmare - payment for the mare was made against exchange permit issued by the RBI - no evidence of remittance of any amount over and above that covered by the foreign demand draft Supplier has also confirmed that price shown in invoice(which was presented by importer) was correct Allegation of undervaluation on basis of said invoice(which is not at the time of import) is not justified

Summary

Issues: Alleged undervaluation and suppression of genuine transaction value in import of broodmare "Final Bluff".

In this case, the Appellate Tribunal CESTAT MUMBAI addressed the issue of alleged undervaluation and suppression of the genuine transaction value in the import of a broodmare named "Final Bluff". The Revenue challenged the Commissioner of Customs' decision to accept the transaction value and drop proceedings for underinvoicing. The Tribunal carefully examined the evidence, including the invoices presented by the importer, and the payment details. The key invoice, CBA/94-07 dated 31.10.1994, showed a total CIF value of UK lb14,856.73, while the buyer was identified as Shri Geoffrey Nagpal. However, the value in another invoice, CBA/94-08 dated 31.1.1994, was significantly lower at UKlb 4243. The payment for the broodmare was made against an exchange permit issued by the Reserve Bank of India, with no evidence of any additional remittance beyond the amount covered by the foreign demand draft for UKlb 4243. The Tribunal noted that the partner of the supplier confirmed the correctness of the price in the invoice of 31.1.1994. Despite the Revenue's reliance on letters from British Customs and the Indian High Commission, the Tribunal found these explanations insufficient to justify the discrepancy in the dates of the invoices and the import. The Tribunal concluded that the allegation of undervaluation was rightly rejected by the adjudicating authority, and therefore upheld the impugned order and dismissed the appeal.

Furthermore, the Revenue also attempted to establish undervaluation based on imports of other broodmares. However, the Tribunal observed that there was no evidence to show that the invoices for the other imported mares were issued by the supplier of the mares involved in the present case. Therefore, the Tribunal held that the undervaluation established for other broodmares could not be used as evidence of undervaluation for the specific broodmare "Final Bluff". As a result, the Tribunal affirmed the decision to reject the allegation of undervaluation and upheld the Commissioner of Customs' order. The judgment was pronounced in court, bringing the matter to a close.