2024 (3) TMI 933 - AT - Customs

Valuation of imported goods - Unwrought / Unrefined Zinc - enhancement of value - rejection of transaction value - demand of additional duty on the basis of NIDB data for primary Zinc ingots - contemporaneous imports or not - HELD THAT - The Department has rejected the transaction value and redetermined the same on the basis of LME price considering the percentage of Zinc content in the consignments in terms of the Test Report of CRCL, Kolkata. As per the Test Report, the Zinc content in Bill-of-Entry No. 4533688 dated 10.03.2016 was 87.80% and the Zinc content in Bill-of-Entry No. 8650713 dated 19.03.2015 was 92.50%. The Ld. Authorized Representative appearing for the Revenue was asked to furnish a copy of both the Test Reports. However, the Ld. Authorized Representative could not submit a copy of the Test Report for the Bill-of-Entry No. 8650713 dated 19.03.2015. It is observed that the percentage of Zinc should be above 92% in Zinc dross . Only in the Bill-of-Entry No. 8650713 dated 19.03.2015, the Zinc percentage was found to be more than 92%. However, no such report has been produced by the Department to substantiate this claim. In the absence of a Test Report, it cannot be considered that the percentage of Zinc content in the goods imported by the respondent was above 92%. In respect of the other Bill-of-Entry No. 4533688 dated 10.03.2016, the percentage of Zinc content was found to be only 87.80%, which is less than 92%. Accordingly, these goods cannot be considered as Zinc dross which are restricted as per the Foreign Trade Policy. The Department has not brought any evidence on record to substantiate their claim that the percentage of Zinc content in both the Bills-of-Entry was more than 92% so as to classify the same as Zinc dross . Accordingly, there is no infirmity in the impugned order passed by the Ld. Commissioner (Appeals) and therefore, the impugned order passed by the Ld. Commissioner (Appeals) is upheld. The appeal filed by the Department is rejected.

Summary

Issues involved:
The issues involved in this judgment include mis-declaration of imported goods, valuation of goods based on zinc content, classification of goods as "Zinc Dross," and the application of Customs Act provisions.

Mis-declaration of imported goods:
The respondent had imported consignments declaring goods as Unwrought/Unrefined Zinc, but a test report revealed higher purity Zinc Dross. The Commissioner of Customs contended that Section 111 of the Customs Act should have been invoked for confiscation due to mis-declaration.

Valuation of goods based on zinc content:
The assessment was finalized based on the actual zinc content from a Test Report, leading to an enhanced assessable value and confirmation of differential duty. The Department argued for the value based on LME price, while the importer claimed the transaction value should prevail.

Classification of goods as "Zinc Dross":
The Department contended that the goods were Zinc Dross, not Unwrought/Unrefined Zinc, which should be classified differently. The Ld. Commissioner (Appeals) found the grounds of appeal beyond the scope of the Assessment Order and set aside the enhanced value, ordering assessment at the declared price.

Application of Customs Act provisions:
The Department argued that the assessing officer should have considered the full test report and not limited the provisional assessment to valuation alone. However, the Tribunal found no evidence to substantiate the claim that the goods were classified as "Zinc Dross," upholding the Ld. Commissioner (Appeals) order.

In summary, the judgment addressed issues related to mis-declaration of imported goods, valuation based on zinc content, classification of goods as "Zinc Dross," and the application of Customs Act provisions. The Tribunal upheld the Ld. Commissioner (Appeals) order, rejecting the Department's appeal due to lack of evidence supporting the classification of goods as "Zinc Dross."