2023 (8) TMI 1158 - AT - Customs

Valuation of imported goods - hydraulic pumps - rejection of declared value - enhancement of value at the price at which identical goods imported - HELD THAT - The adjudicating authority has adopted the value in the bill of entry for assessment of hydraulic pumps imported by M/s Shashi Charu Hydraulics Ltd and these have been deemed as identical goods for comparison. The impugned order has not offered any justification for acceptance of the compared imports as either identical or similar goods - It is also found that the prices used for comparison are not of contemporaneous relevance. Thus, even if rule 10A of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 has been validly invoked, failure to follow through with eligible alternatives under Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 stultifies recourse to section 28 of Customs Act, 1962 and other detriments. The impugned order set aside - appeal allowed.

Summary

Issues involved:
Enhancement of value of imported goods, differential duty liability, interest under Customs Act, fine for redemption of confiscated goods.

Issue 1: Enhancement of value of imported goods
The appellant challenged the enhancement of value of goods imported, along with the differential duty liability and interest imposed under section 28 of the Customs Act, 1962. The impugned order undertook re-valuation of the goods based on rules of Customs Valuation and compared the import price with that of 'identical goods' imported by another entity. The appellant argued that the transaction value of the goods should be accepted as there was no evidence to the contrary. The adjudicating authority used the value of 'identical goods' for comparison but failed to justify this decision or consider the conformity of the relied-upon imports with the prescribed rules.

Issue 2: Differential duty liability and fine for redemption
The appellant was also burdened with differential duty liability and fines for redemption of confiscated goods under the Customs Act, 1962. The appellant contended that the import price could not be compared with any other due to post-supply negotiations that led to favorable terms. Additionally, the appellant argued that the country of origin of the relied-upon goods was different, which should have been considered in the adjudication proceedings. The impugned order did not provide adequate justification for accepting the compared imports as 'identical' or 'similar' goods, and the prices used for comparison were not contemporaneously relevant.

Decision:
The Appellate Tribunal set aside the impugned order, allowing the appeal of the appellant. The Tribunal found that the impugned order failed to justify the acceptance of compared imports as 'identical' or 'similar' goods and did not follow through with eligible alternatives under the Customs Valuation rules. This failure invalidated the recourse to section 28 of the Customs Act, 1962, and other associated detriments.