1996 (12) TMI 244 - AT - Central Excise

Summary

Issues: Valuation of imported goods, reliance on invoice for valuation, comparison with similar imports, relevance of packing, necessity of re-test reports, contemporaneous evidence of imports, enhancement of value based on association letter, determination of redemption fine and penalty.

In this judgment by the Appellate Tribunal CEGAT, Madras, the issue primarily revolved around the valuation of imported goods, specifically Poly Propylene, where the Commissioner valued the goods at 1100 US $ while the appellant declared the value at US $ 300 per M.T. The appellant contended that the impugned order relied on an invoice dated 24-5-1995 for Singapore origin goods, whereas the imported goods were of USA origin and of inferior quality. The appellant argued that the department should have considered similar imports during the relevant time period. The appellant also highlighted discrepancies in packing and quality, which were not addressed in the impugned order. The appellant presented documents showing lower values for similar imports to support their case.

The department, represented by the learned SDR, argued that samples were sent for testing, but reports were not received, and the appellant consented to adjudication without those reports. The department relied on evidence from commercial invoices and previous imports to justify the valuation in the impugned order. The SDR contended that the valuation was in accordance with the law and relied on decisions by the Hon'ble Supreme Court and the Tribunal to support their position.

The Tribunal analyzed the contentions from both sides and emphasized the importance of determining the transaction value in accordance with the Customs Act and Valuation Rules. The Tribunal referred to previous judgments to establish that identical goods should be considered for valuation, with a focus on country of origin, quantity, and period of import. The Tribunal found that the goods imported by the appellant at US $ 300 should be the transaction value, as the evidence from the invoice relied upon by the Commissioner did not conclusively prove the import against that invoice. The Tribunal also noted discrepancies in country of origin and packing, which favored the appellant's arguments.

Regarding the import of LDPE, the department sought to enhance the value based on a communication from an association, but the Tribunal held that such evidence without contemporaneous imports data was insufficient to prove under-valuation. The Tribunal emphasized the burden on the department to provide evidence for valuation adjustments and ruled in favor of the appellant's valuation. The Tribunal also addressed the redemption fine and penalty, reducing the redemption fine due to demurrage concerns but maintaining the penalty amount.

In conclusion, the Tribunal partially allowed the appeal concerning the valuation of imports, rejected the enhancement of value based on the association letter, and adjusted the redemption fine and penalty amounts. The judgment highlighted the importance of evidence, comparability of imports, and adherence to valuation rules in determining the value of imported goods.