2024 (4) TMI 78 - AT - Customs

Valuation of imported goods - Quinizarine - enhancement of value - determination of value on the basis of value of contemporaneous import by same importer (Appellant) from the same supplier - HELD THAT - In the present case though the Bills of entry of contemporaneous import were relied upon the adjudicating authority failed to consider the circumstance of the variation of the price of the imported goods existed at the time of export from China to India. Further it is also noticed that Ld. Commissioner (Appeals) has not given any finding on the reason of price variation of goods submitted by the Appellant. It is also observed that other than Bills of entry of contemporaneous import there is no other evidence to show that the assessee have suppressed the value. It is also observed that the appellant have relied upon various judgments on the disputed issue which Learned Commissioner (Appeals) had no occasion to consider. The judgments relied upon by the appellant shall apply directly only after verifying the facts of each case. Since the above issues have not been dealt in a proper manner by both the lower authorities the matter needs to be reconsidered as a whole. Accordingly the impugned order is set aside and the matter remanded to the Ld. Adjudicating Authority for passing a fresh after providing sufficient opportunity of personal hearing to the appellant - appeal allowed by way of remand.

Summary

Issues Involved:
The issues involved in this case are the enhancement of value in three Bills of Entry declared by the Appellant for the clearance of "Quinizarine" from China, the consideration of transaction value u/s 14(1) of the Customs Act, 1962, and the failure to properly consider the facts and circumstances leading to the variation in prices of the disputed goods.

Issue 1 - Enhancement of Value in Bills of Entry:
The Appellant filed Bills of Entry declaring the Assessable value as US $ 9.5 per kg for "Quinizarine" from China. The Customs department enhanced the value based on the transactional value of identical goods, considering factors like sale at the same commercial level and the transaction value of imported identical goods. The lower adjudicating authority determined the value based on a previous import by the Appellant at US $ 12.5 per kg. The Commissioner of Customs (Appeals) dismissed the appeals filed by the Appellant against the enhancement of value.

Issue 2 - Consideration of Transaction Value u/s 14(1) of the Customs Act:
The Appellant argued that the justification of the transaction value declared under Section 14(1) of the Customs Act, 1962 was not properly considered. They highlighted that the sudden strict Environment Regulation introduced by the Chinese Government affected the demand-supply equation, leading to a variation in the price of goods. The Appellant emphasized that the transaction value declared was the sole consideration, and other conditions specified in Section 14(1) were not applicable. They also pointed out that the value of imported goods in August 2019 cannot be compared with those in September 2019, and the authorities failed to consider the market conditions affecting the price.

Issue 3 - Failure to Properly Consider Price Variation:
Both the adjudicating authority and the Ld. Commissioner (Appeals) did not properly consider the facts and circumstances leading to the variation in prices of the disputed goods. The Appellant argued that due to strict Environment Regulation in China, the production of "Quinizarine" was disrupted, leading to a temporary increase in prices. However, with time, the compliance position eased, and prices rolled back. The authorities failed to appreciate these factors, and the Ld. Commissioner (Appeals) did not provide any finding on the reason for the price variation. The Appellant's arguments and judgments on the issue were not adequately considered.

In conclusion, the Appellate Tribunal set aside the impugned order and remanded the matter to the Ld. Adjudicating Authority for a fresh decision, emphasizing the need to reconsider the issues raised by the Appellant and provide a sufficient opportunity for a personal hearing.