2024 (3) TMI 1247 - AT - Customs

Misdeclaration of the transaction value - Confiscation of goods - Recovery of the differential duty - interest and penalty - Import of Copper Cathodes - Acceptance of loaded value of the consignments earlier - HELD THAT - We find that learned Commissioner finds that the date of invoice is later than the date of bill of lading; the appellants did not submit the original copy of the contract and therefore there are reasons to believe that the transaction value is liable for rejection. On the other hand learned Counsel for the appellants submits that their business model was informed to the Commissioner and have produced the original contract along with bank payment remittance advice on 06/09/2012 and this being so rejection of the transaction value was incorrect; He further submits that none of the conditions illustrated under Rule 12 exist in the instant case and therefore the rejection was not proper and legal. We find that Learned Commissioner finds that the importer was accepting the loaded value of the consignments cleared earlier and for that reason the importer does not have any reason for not accepting the loading of the value in the instant case. It is also not explained as to how the situations illustrated under Rule 12 are existing and no case of payment of differential amounts through non-banking channels is alleged. Thus we find that Revenue has not made any case for rejection of the transaction value i.e the value declared by the importer. Thus we find that no case has been made for rejection of the declared value in the impugned case and therefore the consequential redetermination of value confiscation of the impugned goods and imposition of penalty are not proper and legal. Hence the impugned order is set aside and the appeal is allowed.

Summary

Issues involved:
The issues involved in the judgment are rejection of declared value of imported goods, confiscation of goods under Section 111(M) of the Customs Act, 1962, re-assessment of goods, and imposition of penalty under Section 112(A) of the Customs Act, 1962.

Rejection of Declared Value:
The appellant, a regular importer of Copper Cathode, imported goods with a declared value of Rs. 2,31,35,872.20. The Commissioner rejected this value under Rule 12 of the Customs Valuation Rules, 2007, and ordered re-assessment at a higher value of Rs. 2,48,67,482. The appellant argued that the declared price was in line with their contract terms, which allowed for variations based on LME price, premium, and additional costs. The Tribunal found that the reasons cited for rejecting the declared value were not applicable in this case. The bench referred to previous orders and legal principles to conclude that the rejection was unjustified, setting aside the impugned order.

Confiscation of Goods and Penalty Imposition:
The impugned goods were confiscated under Section 111(M) of the Customs Act, 1962, with an option for redemption on payment of a fine of Rs. 5,00,000. Additionally, a penalty of Rs. 10,00,000 was imposed under Section 112(A) of the Customs Act, 1962. The appellant argued that the rejection of declared value was unwarranted, as they had provided the necessary documentation and explanations regarding the pricing structure. The Tribunal found that the reasons given for confiscation and penalty imposition were not valid in this case, as the rejection of declared value itself was deemed improper and not legally sound. Therefore, the impugned order was set aside, and the appeal was allowed.