2023 (11) TMI 268 - AT - Customs

Undervaluation - rejection of declared value on the basis of such inadmissible documents - Whether the Export Declarations received from China are genuine documents to be read into evidence? - HELD THAT - Nothing has been produced by appellant to Show that these documents were incorrect or that the declarations made before the Chinese Authorities were different. The mode of procuring the documents during investigation and the absence of any other Export Declarations with the appellants is therefore sufficient for us to hold that the appellant has failed to rebut the presumption of correctness attached to these documents in terms of section 139 of the Customs Act. Appellant has not produced any other cogent document to show that price as was declared to the Chinese Customs was different from the price which is mentioned in the export declaration obtained by the department from China through Consulate General of India The Export Declarations as received from China are, therefore, admissible in the evidence - there appears no doubt about the authenticity of documents as these were obtained by DRI through the Government channel and were obtained from the concerned Department of the exporting country. Whether appellant mis-declared the goods imported under the Bills of Entry? - HELD THAT - The appellant had admitted the presence of five different rolls of Reflecting Sheets of different series TM 18 100 to have been sent by the exporter as samples, but still had not shown the same in the Bills of entry. This admission corroborates the Department s stand that the appellant despite having knowledge of the content of his consignment and the correct/export value of the goods in the said consignment, has failed to declare the same - vide letter dated 25.02.2010 the Chinese exporter has certified that appellant is their Customer for years for reflective sheets under Sablite brand. This document confirms the alleged mis-declaration as the said brand has not been declared in Bill of Entry. Though the price in said certificate is mentioned to be @ USD 0.48 per Sq. Mtr. but simultaneously the exporter has rescued itself from any responsibility due to any problem with reference to the grade ordered. The defence taken by appellant that Chinese declarations are merely the photocopies is also not acceptable - appellant mis-declared the goods while importing them - appellant mis-declared the goods while importing them. This issue also stands decided in favour of the Revenue. Whether in the Bills of Entry the goods were undervalued and if so, whether the re-determination of the value and demand of differential duty and the confiscation of the goods imported under the Bill of Entry dated 9.2.2010 and the redemption fine and the penalties imposed can be sustained? - HELD THAT - If the transaction value is rejected under Rule 12, then it must be determined sequentially under Rules 4 to 9. Rule 4 provides for the valuation to be done on the basis of identical goods. Rule 5 provides for the valuation to be done on the basis of the value of similar goods. Rule 6 states if Rules 4 and 5 cannot determine the value then they must be done as per Rule 7 and thereafter Rule 8 but this sequence can be reversed at the option of the importer - Thus, if the officer has reason to doubt the truth and accuracy of the transaction value, he can call for information including documents and evidence. If the information and evidence is presented and after examining it or if no information or evidence as called for is presented, if the proper office has reasonable belief then it shall be deemed that the value cannot be determined as per Rule 3 (i.e., based on transaction value with additions, if necessary). The grounds on which the proper officer may raise doubts about the truth and accuracy of the transaction value have been illustrated in explanation 1 (iii) to Rule 12. The Commissioner confiscated goods imported under the Bill of Entry dated 9.2.2010 which were seized and provisionally released on execution of a bond under section 111(m) but she refrained from confiscating the goods imported under the past Bills of Entry. Since the undisputed fact is that the goods imported in the Bill of Entry were not fully declared and five additional rolls were imported but not declared and also since we found that the value declared in this Bill of Entry was correctly rejected under Rules 12 and re-determined under Rule 4, we find that there was mis-declaration of the goods both in terms of value and quantity and the confiscation under section 111(m) must be upheld. The redemption fine of Rs. 5,00,000/- imposed under section 125 on the goods valued at Rs.64, 86,108/- is very fair and reasonable and calls for no interference. The appellant had, undisputedly, mis-declared the quantity of the goods imported in the Bill of Entry dated 9.2.2010. Shri Varinder Singh admitted in his statement that he had not declared five rolls of a different type which were also imported. Further, in respect of four of the past Bills of Entry, the values declared by the exporter before the Chinese authorities was much higher than the values declared in the Bills of Entry by the appellant - the appellant was liable to penalty under section 114AA and the penalty of Rs. 10,00,000/- was just and fair in the factual matrix of this case. The findings of the adjudicating authority below agreed upon - appeal dismissed.

Summary

Issues Involved:
1. Whether the Export Declarations received from China are genuine documents to be read into evidence.
2. Whether the appellant mis-declared the goods imported under the Bills of Entry.
3. Whether the goods were undervalued and if so, whether the re-determination of the value, demand of differential duty, confiscation of the goods, and the penalties imposed can be sustained.

Issue No. 1:
The Tribunal examined the admissibility of export declarations from China, which contained detailed information such as Exporter name, Consignee name, and FOB Value. These documents were obtained through the Consulate General of India and were deemed genuine and admissible under Section 139 of the Customs Act, 1962. The appellant's objection that these declarations lacked signatures or stamps was dismissed, as the documents were processed electronically. The appellant failed to produce any contrary evidence. Therefore, the Tribunal held that the export declarations were admissible as evidence.

Issue No. 2:
The Tribunal found that the appellant mis-declared the goods by not specifying the brand "Sablite" and undervaluing the goods. The market enquiry, although based on a single quotation, corroborated the values declared before Chinese Customs. The appellant admitted to not declaring five rolls of Reflecting Sheets in the Bill of Entry dated 9.2.2010. The Tribunal upheld the findings of mis-declaration and undervaluation, rejecting the appellant's argument that the Chinese declarations were mere photocopies.

Issue No. 3:
The Tribunal examined the legal provisions relating to customs valuation under Section 14 of the Customs Act and the Customs Valuation Rules, 2007. The Commissioner had rightly rejected the transaction value under Rule 12 and re-determined it under Rule 4 based on the value of identical goods. The Tribunal upheld the re-determination of value and the consequent demand of differential duty. The goods imported under the Bill of Entry dated 9.2.2010 were correctly confiscated under Section 111(m) with a redemption fine of Rs. 5,00,000/-. The penalties under Sections 114A and 114AA were also upheld, as the appellant had knowingly mis-declared the goods and used false documents.

Conclusion:
The Tribunal upheld the findings of the adjudicating authority, confirming the re-determination of value, demand of differential duty, confiscation of goods, and imposition of penalties. The appeal was dismissed.