2006 (8) TMI 48 - AT - Customs

Customs Transaction value enhanced As evidence bill of entry finally assessed after enhancement of value, therefore, further loading of value cannot be upheld Quotations/letters/price lists cannot be made basis for further enhancement of transaction value No evidence of contemporaneous imports Enhancement of value and penalties set aside

Summary

Issues:
1. Enhancement of assessable value of imported goods
2. Confiscation of imported goods under Sec. 111(m) of the Customs Act, 1962
3. Imposition of penalties under various sections of the Customs Act
4. Under-valuation of goods based on evidence and investigations
5. Contemporaneous import data and assessment of declared values
6. Reliability of proforma invoices and export declarations
7. Discrepancies in export declarations and invoices
8. Rejection of provisional Bills of Entry for determining the value of goods
9. Absence of contemporaneous imports for loading value
10. Application of Rule 4 of the Customs Valuation Rules

Analysis:
1. The appeals arose from the Commissioner of Customs enhancing the assessable value of Button Cells and Battery Cells imported by a company, leading to differential duty demands, confiscation of goods, and imposition of penalties under various sections of the Customs Act.

2. The finding of under-valuation was based on statements of the Importer's Director and another individual, export declarations filed in Hong Kong, investigation reports, and documents showing higher values, leading to the enhancement of declared values for specific Bills of Entry.

3. The Tribunal examined the enhanced values for the goods covered by the Bills of Entry, considering evidence of contemporaneous import data and detailed examination of the goods. It held that once values were finally assessed, no further loading of value could be done based on quotations or proforma invoices.

4. The Tribunal found discrepancies in export declarations and invoices, such as differences in the country of origin, and rejected reliance on proforma invoices for loading value. It also noted the absence of evidence supporting the rejection of provisional Bills of Entry for determining the value of goods.

5. Due to the absence of contemporaneous imports and the availability of transaction value, the Tribunal concluded that the declared values should be accepted, especially when there was no evidence of similar goods being imported at higher values.

6. Consequently, the Tribunal set aside the enhancement of values and penalties imposed, ruling in favor of the appellants based on the lack of evidence supporting the actions taken by the Commissioner of Customs.