2015 (11) TMI 692 - SC - Customs

Availment of fraudulent DEPB Scheme - Inflation of price - Held that - A perusal of the order reveals that the CESTAT has noted that the respondents purchased the CD ROMs from the local market directly from the manufacturer. The purchase price of ₹ 640/- has not been challenged. It is not the case of the Department that the transaction between the manufacturer and the respondents is not genuine. It is also not Department s case that the transaction between the respondents and the foreign buyers is not genuine. Respondents have procured the goods for valuable consideration and in turn, received the foreign exchange fully for the sale of goods to the foreign buyers. Therefore, there is no reason to discard the transaction value as between the manufacturer and the respondents nor as between the respondents and foreign buyers. The CESTAT also found that the Department has not shown that at the time and place of exportation, such or like goods have been exported from India at much lower price as claimed by the Department. It is also an accepted fact that the respondents and foreign buyers are not related parties. - all the aspects have been duly and rightly considered by the CESTAT. The analysis of the material is on factual aspect and no substantial question of law arises for consideration in the instant appeal - Decided in favour of assessee.

Summary

Issues:
Allegations of inflated export value for DEPB schemes.

Analysis:
The case involved merchant exporters who purchased CD-ROMs at a certain price and exported them at a higher rate. The Department alleged that the declared export value was inflated to benefit from DEPB schemes. However, the Commissioner, in the Order-in-Original, found no contravention of the Customs Act. The Department appealed to CESTAT, which, in its decision, accepted the respondent's case, stating that the declared price was genuine. CESTAT noted that the purchase price was not challenged, and there was no evidence to suggest the transactions were not genuine. It was also established that the goods were procured for valuable consideration, and the foreign exchange was received in full. The Department failed to prove that similar goods were exported at a lower price, and there was no relationship between the exporters and foreign buyers.

The Supreme Court upheld CESTAT's decision, stating that all aspects were duly considered, and no substantial legal questions arose for consideration. The Court dismissed the appeal, confirming the authenticity of the transactions. Additionally, in Civil Appeal Nos. 3140-3143 of 2008, the appeals were dismissed in line with the previous order in Civil Appeal No. 1581 of 2007.