2023 (7) TMI 70 - AT - Customs

Demand of differential duty without challenging the original assessment of the Bills of entry - Undervaluation of goods imported from Bangladesh - Department alleged that the declared MRP of the cement imported by the Appellant was much less as compared to the MRP declared on the cement imported from the same manufacturer through other ports - HELD THAT - It is observed that different lots of the impugned goods were imported by different importers through different land ports though the goods were manufactured by the same manufacturer in Bangladesh. The Appellant stated that the MRP printed on the goods imported through other ports can be different as the Place of importation itself was different and hence difference in MRP is quite natural - it is observed that MRP on the same item is decided in consideration of a number of factors besides landing cost and duty element. In the instant case the goods were imported through different ports. That itself is a valid reason for the difference in price. There is no evidence to suggest that the goods so imported through different ports under different MRP were being sold at same price. Hence, the price difference cannot be attributed to suppression of the value by the Appellant. Accordingly, the demand is not sustainable. The self-assessment of the Bills of Entry by the importer was not challenged by the department. The Hon ble Supreme Court in the case of ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV 2019 (9) TMI 802 - SUPREME COURT has held that the claim for refund cannot be entertained unless the order of assessment or self-assessment is modified in accordance with law by taking recourse to the appropriate proceedings and it would not be within the ken of Section 27 to set aside the order of self-assessment and reassess the duty for making refund; and in case any person is aggrieved by any order which would include self-assessment, he has to get the order modified under Section 128 or under other relevant provisions of the Act. The ratio of the above said decision is squarely applicable in this case - the impugned order passed demanding differential duty without challenging the original assessment of the Bills of entry is not sustainable. Hence, the demand is not sustainable on this count also. Appeal allowed.

Summary

Issues involved: Undervaluation of imported cement, Challenge to self-assessment of Bills of Entry

Undervaluation of imported cement:
The Appellant, a Power of Attorney holder of a company engaged in import and export business, imported cement from Bangladesh through a specific land border. The Customs department alleged undervaluation based on a comparison of the declared Maximum Retail Price (MRP) with cement imported from the same manufacturer through another port. The Adjudicating Authority confirmed the demands, but the Commissioner (Appeals) upheld the decision. The main argument presented was that different importers through different ports may have different MRPs due to various factors, and the price difference does not indicate undervaluation. The Tribunal agreed, emphasizing that the MRP is influenced by multiple factors and importing through different ports can naturally lead to price variations. Since there was no evidence of the goods being sold at a higher price than the MRP, the allegation of undervaluation was deemed unfounded.

Challenge to self-assessment of Bills of Entry:
The Appellant contended that the self-assessed Bills of Entry were not challenged by the department, invoking a Supreme Court decision that states unless the original assessment is challenged, the department cannot demand differential duty subsequently. Citing another Supreme Court case, the Appellant argued that demanding differential duty without challenging the self-assessment is impermissible. The Tribunal concurred, referencing the Supreme Court's stance that a claim for refund cannot be entertained unless the assessment or self-assessment is modified in accordance with the law. As the department did not challenge the original assessment, the demand for differential duty was deemed unsustainable. Consequently, the Tribunal set aside the impugned order and allowed the appeal filed by the Appellant.