2003 (11) TMI 213 - AT - Customs

Summary

Issues involved: Valuation of imported goods

Summary:
The case involved the valuation of imported Plain Medium Density Fibre Board (PMDFB) by the appellants, who declared a value of 140 US $/CBM on two consignments. The original authority rejected this declared value and determined it to be US 180 per CBM. The Commissioner (Appeals) upheld this decision, leading to the current appeal.

The appellants argued that the Commissioner (Appeals) order lacked reasoning, the manufacturer's invoice should have been accepted, comparing different goods for valuation was incorrect, and the rejection based on contemporaneous prices was not permissible as per legal precedents. The Department supported the order of the Commissioner (Appeals).

Upon hearing both sides, it was found that the appellants ordered the goods from a trader in UAE, who then ordered from manufacturers in Germany. The manufacturer's invoice to the UAE trader was for US 88/CBM, but the importer declared a value of US 140/CBM. Despite the goods being of prime quality, the Department rejected the declared value based on contemporary invoices showing prices ranging from 180 US to 205 US per CBM. However, the rejection was not based on the circumstances for rejection of transaction value as per Rule 4 of the Valuation Rules.

The Tribunal observed that the rejection of the declared value solely based on contemporary imports was not justified, as per legal precedent. Following the Supreme Court's decision in Basant Industries, it was held that mere comparison of invoices with imports by other importers is not conclusive for determining undervaluation. Therefore, the appeal was allowed, the impugned order was set aside, and the appeal was allowed.