2009 (6) TMI 228 - AT - Customs

Valuation of imported goods residual method - it is necessary for the authorities to take into consideration the data available in India in relation to the value of the similar such imported goods. - the appellant is justified in contending that, the impugned order has been passed by the authorities below arbitrarily and without any proper basis for adopting and justifying 50% addition of over and above the price disclosed by the importer. - It is pertinent to note that, though, in some cases, the unit price by the supplier is disclosed at same rate as procurement price in respect of same imported goods, but that will not be the basis for enhancement of price by addition of 50% over and above the price list submitted by the importer. - Impugned order cannot be sustained and is liable to be set aside.

Summary

Issues: Compliance with Rule 8 of Customs Valuation Rules

Analysis:
The judgment by the Appellate Tribunal CESTAT, Mumbai, involved a challenge against an order for non-compliance with Rule 8 of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988. The appellant contended that the authorities failed to consider data available in India for determining the value of imported goods, as required by Rule 8. The tribunal noted that the impugned order did not disclose any such data being considered, even though the determination was made under Rule 8. Rule 8 mandates that if the value cannot be determined under preceding rules, it should be based on data available in India. The tribunal emphasized that authorities must consider Indian data related to similar imported goods for valuation. The impugned order was found to lack reference to relevant data, leading to an arbitrary decision of adding 50% over the importer's price without proper justification. Consequently, the tribunal set aside the order and remanded the matter for a proper valuation in compliance with Rule 8 after hearing both parties.

Conclusion:
The judgment highlighted the importance of complying with Rule 8 of the Customs Valuation Rules by considering Indian data for determining the value of imported goods. It emphasized the need for authorities to justify any additions to the importer's price with relevant data and principles outlined in the rules. The decision to set aside the order and remand the matter for proper valuation underscored the tribunal's commitment to ensuring fair and accurate valuation practices in line with the legal provisions.