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TMI Blog2016 (7) TMI 359X X X X Extracts X X X X X X X X Extracts X X X X ..... ide - Decided in favor of assessee. - C/394/2006, C/395/2006, C/396/2006, C/397/2006 and C/337/2006 - Final Order No. 20391-20395/2016 - Dated:- 6-6-2016 - Shri S. S. Garg, Judicial Member and Shari Ashok K. Arya, Technical Member Mr. M.S. Nagaraj, Advocate For Appellants Mr. Pakshi Rajan, A.R. For Respondent ORDER These five appeals have respectively been filed by M/s Peekay Steel Castings Pvt. Ltd., Calicut (Kerala) and M/s Peekay Re-rolling Mills Pvt. Ltd., Calicut (Kerala). These appeals involve common issues and, therefore, are being taken up together for the decision. 2. These two appellants are sister units and are manufacturers of Steel Ingots, Bars, and Rods. The appellants imported Heavy Melting Scrap (HMS)/ Shredded Scrap (foundry grade) of UAE origin and filed Bills of Entry for import through Cochin Port. 2.1 The Deputy Commissioner of Customs (Import), Cochin based on price of similar goods imported at other Ports ordered the enhancement of value of imported goods and issued respective Orders-in-Original accordingly. 2.2 The appellants filed appeals before the Commissioner (Appeals) against the respective Order-in-Original enhanci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 205.450 220 268 83,157/- 145735/28.7.04 271.750 260 268 18,332/- 145965/31.7.04 185.560 240 268 43,812/- 145963/31.7.04 293.310 240 268 69,945/- Excess Duty Paid : Total 215,246/- TABLE 4 APPEAL No. C/397/2006-M/s Peekay Re-Rolling Mills(P) Ltd against Order-in-Appeal No 145/06 dated 22.5.2006 Bill of Entry Number date Quantity of HMS (MT) Value Declared by Appellants (Us $ per MT) Value Adopted by Customs (US $ per MT) Excess Duty Paid (Rs) 146423/11.8.04 288.930 220 268 1,18,603/- 146424/12.8.04 334.340 230 268 1,08,651/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If the value cannot be determined under clause (i) then only the value shall be determined by proceeding sequentially under Rules 5 to 8 of the Rules. (iv) In terms of Rule 4(1), transaction value of imported goods shall be the price actually paid or payable for the goods. The transaction value shall be rejected only when transactions come within the scope of exceptions or special circumstances particularized in Rule 4(2) of the Customs Valuation Rules, 1988. (v) The adjudicating authority and the Commissioner (Appeals) did not record any finding that transaction value cannot be accepted because the transactions come within the exceptions of special circumstances mentioned in Rule 4 (2) of the Customs Valuation Rules, 1988. (vi) There is no allegation or finding of mis-declaration of price or description of imported goods. There is no case that importer has paid any amount in excess of the invoice price. There is no ground made out to doubt the truth or accuracy of the invoices under Rule 10A. (vii) In the absence of any grounds to reject the transaction value, the adoption of the comparable goods in terms of Rule 6 of the Customs Valuation Rules, 1988 is not legally ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.2 Further provisions of Rule 3 (ii) of the Customs Valuation (Determination of the Price of Imported Goods) Rules, 1988 are clear that if the transaction value of the imported goods has to be rejected, then value has to be determined by proceeding sequentially through Rules 5 to 8 of the Customs Valuation Rules 1988. We do not find any evidence that the original adjudicating authority or the Commissioner (Appeals) exhausted the application of Rule 4 or Rule 5 of the Customs Valuation Rules 1988 before deciding he valuation of imported goods under Rule 6 of the Customs Valuation Rules, 1988. There is no proper justification given by the Revenue for ordering enhancement of the value declared by the appellants as per the provisions of Customs Valuation Rules, 1988. Proviso to Rule 4(2) of the Customs Valuation Rules, 1988, Give special Circumstances saying that where these conditions/circumstances exist, it is binging on Customs to accept the price actually paid or payable for the goods when sold for export to India as the transaction value. And Revenue failed to convincingly prove that said conditions/ circumstances did not exist and there was valid legal justification the enha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Rules, 1988, which was later amended by way of insertion /renumbering by M.F. (d.R.) notification No. 41/2001-Cus (N.T.), dated 7-9-2001. The Hon ble Supreme Court in this case inter-allia observed as follows : 7. The rules which have been framed are the Customs, Valuation (Determination of Price of Imported Goods) Rules, 1988. The rules came into force on 16th August, 1988. Under Rule 3(i) the value of imported goods shall be the transaction value . Transaction value ' has been defined in Rule 2(f) as meaning the value determined in accordance with Rule 4. Rule 4(1) in turn states : The transaction value of imported goods shall be the price actually paid or payable for the goods when sold for export to India, adjusted in accordance with the provisions of Rule 9 of these rules. 8. Reading Rule 3(i) and Rule 4(1) together, it is clear that a mandate has been cast on the authorities to accept the price actually paid or payable for the goods in respect of the goods under assessment as the transaction value. But the mandate is not invariable and is subject to certain exceptions specified in Rule 4(2) namely : (a) there are no restrictions as to the disposi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court clearly held that the price actually paid or payable has to be accepted as transaction value except in case of exceptions and here the Hon ble Supreme Court held that subject impugned case was not covered under exceptions. 6.4.1 In the present appeals also, we do not find that these cases are covered under exceptions, and where provisions of Rules 4 and 5 have been exhausted and Revenue could go for application of Rule 6 of the Customs Valuation Rules (CVR), 1988. In other words, Revenue has not followed the provisions of Rule 3 (ii) of CVR, 1988, which say that where value of imported goods cannot be determined under Rule3 (i) of CVR, 1988, it has to be determined by proceeding sequentially through Rules 5 to 8 of these Rules. Let us further refer here to the Hon ble Supreme Court s decision in the case of Chaudhary Ship Breakers (supra), where in the Para 15 the observations are as under : 15. . . . . According to Section 14(1A) price of imported goods is to be determined in accordance with the Rules framed in this behalf. Under Rule 3(i) of the 1988 Rules, the value of the imported goods shall be the transaction value . Transaction value has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... den of proof by producing evidence of contemporaneous imports at a higher price, the onus shifts to the importer to establish that the price indicated in the invoice relied upon by him is correct. 12. . . . . Therefore, unless the price actually paid for a particular transaction falls within the exceptions mentioned in Rules 4(2)(c) to (h), the Department is bound to assess the duty on the transaction value. It was further held that Rule 4 is directly relatable to Section 14(1) of the Act. Section 14(1) read with Rule 4 provides that the price paid by the importer in the ordinary course of commerce shall be taken to be the value in the absence of any special circumstances indicated in Section 14(1). Therefore, what should be accepted as the value for the purpose of assessment is the price actually paid for the particular transaction, unless the price is unacceptable for the reasons set out in Rule 4(2). [Also See : Rabindra Chandra Paul v. Commissioner of Customs (Preventive), Shillong, (2007) 3 SCC 93 = 2007 (209) E.L.T. 326 (S.C.)] 13. Applying the above principles to the facts in hand, we are of the opinion that the revenue erred in rejecting the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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