2016 (12) TMI 196 - AT - Customs

Valuation - the contemporaneous import made in Calcutta Port as is appearing in para 4 of the show cause notice was just a day after the import made by the Bill of Entry No. 805156 dated 30.8.2005 by the appellant. The value declared was USD17.52 in the contemporaneous import but the appellant declared the value at USD13. When there is a data available very near to the present import and that too after the present import, the value of the contemporaneous import has to be accepted. Revenue relies on the decision of the Hon ble Supreme Court in the case of Rajkumar Knitting Mills (P) Ltd. Vs. Collector of Customs, Bombay 1998 (1) TMI 76 - SUPREME COURT OF INDIA Held that - we do not find a comparable basis in absence of the source of supply, terms and conditions of supply as well as quantity of supplies. The judgment relied on by Revenue categorically shows that the supplier is same, quantity supplied is also brought out clearly and there was no much difference between the date of imports. Once the conditions of supplies are known to the importer and that is hidden, then Revenue would have made a case in their favour. But that is not the case in the present appeal. The contemporaneous value cannot be treated as contemporaneous in absence of details relating to source of supply, quantity and conditions of contract. Therefore, Revenue is not benefitted from the Apex Court judgment cited We do agree with the serious contentions of Revenue, but in absence of comparable value, it is difficult to accept such contention. Learned AR supports the adjudication and opposes the order of learned Commissioner (Appeals). We fully agree with learned AR that learned Commissioner (Appeals) has gone only for the comparison of the contemporaneous evidence without looking to the valuation rule as is agitated by learned AR. But to come to rescue of learned AR, the ingredients of valuation have not also been invoked in the show cause notice - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Discrepancy in declared values between contemporaneous imports.
2. Application of valuation rules in absence of comparable basis.
3. Interpretation of Supreme Court judgment on contemporaneous imports.

Issue 1: Discrepancy in declared values between contemporaneous imports
The Revenue argued that the value declared in a contemporaneous import was higher than the value declared by the appellant. The Revenue relied on a Supreme Court judgment to support their argument. The Tribunal noted the proximity of the two imports in question but emphasized the lack of details regarding the source of supply, terms and conditions, and quantity of supplies. The Tribunal concluded that without these crucial details, the value of the contemporaneous import cannot be accepted as such, and the Revenue cannot benefit from the cited Supreme Court judgment.

Issue 2: Application of valuation rules in absence of comparable basis
The Tribunal highlighted the absence of a comparable basis due to the lack of essential details related to the source of supply, terms and conditions, and quantity of supplies. While acknowledging the serious contentions raised by the Revenue, the Tribunal found it difficult to accept their argument without a comparable value. The Tribunal noted that the adjudication did not invoke the ingredients of valuation, and the Commissioner (Appeals) solely relied on a comparison of contemporaneous evidence without considering the valuation rules as argued by the learned AR.

Issue 3: Interpretation of Supreme Court judgment on contemporaneous imports
The Tribunal examined the Supreme Court judgment cited by the Revenue and emphasized the importance of knowing the supplier, quantity supplied, and conditions of supply for treating an import as contemporaneous. The Tribunal pointed out that the conditions of supplies must be known to the importer and if hidden, Revenue could have a case in their favor. However, in the present case, the Tribunal found that the necessary details were lacking, and therefore, the Revenue could not benefit from the Supreme Court judgment cited.

In conclusion, the Tribunal dismissed the Revenue's appeal based on the lack of a comparable basis for valuation and the absence of essential details regarding the contemporaneous imports in question. The Tribunal emphasized the importance of considering all relevant factors, including the source of supply, terms and conditions, and quantity of supplies, in determining the value of imports.