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TMI Blog2022 (6) TMI 177X X X X Extracts X X X X X X X X Extracts X X X X ..... value is fixed by the Board, it is the value (sub- section 2 of Section 14); b) If no tariff value is fixed by the Board, valuation is as per the transaction value, if necessary, with some additions (as per the first proviso to sub-section 1 of section 14 and as per Rule 10); c) If the transaction value is rejected as per Rule 12 by the proper officer, valuation has to be done as per the value of identical goods (Rule 4); d) If transaction value is rejected and there is no value of identical goods, then it must be as per the value of similar goods (Rule 5); e) If transaction value is rejected and there is no value of identical goods or similar goods, the value must be determined through Deductive method (Rule 7) f) If transaction value is rejected and there is no value of identical goods or similar goods and it is not possible to determine value following deductive method, then value must be determined through computation (Rule 8) g) If the importer so chooses, computational method may be adopted without examining the deductive method first (Rule 6). h) If the transaction value is rejected and there is no value of identical goods or similar goods and if it is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The goods declared transaction value was correctly rejected under Rule 12 of the Valuation Rules by the original authority and such rejection were upheld by the impugned order - The value of the similar goods were obtained not only from other imports taken from NIDB data but also from the manufacturer s price lists. Under these circumstances, we find nothing incorrect in the order-in-original rejecting the transaction value under Rule 12 re-determining the value as per Rule 5 and demanding the differential duty along with interest and the Commissioner (Appeals) upholding the same in the impugned order. As it is found that the duty short levied was correctly demanded under Section 28, penalty imposed under Section 114A also needs to be upheld. Penalty under Section 114AA - HELD THAT:- Revenue has discharged its liability by comparing the declared value with contemporaneous imports as well as with the manufacturer s price list for the same goods and the difference was very large. In some cases the declared price was less than half. In the case of NEHA INTERCONTINENTAL (P) LTD. VERSUS COMMISSIONER OF CUSTOMS, GOA [ 2006 (5) TMI 279 - CESTAT, MUMBAI] , the factual finding of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. BSN Nitrix 180 240 239 530 5. No Explode 2.2 Ib 240 253 555 6. BSN Nitrix 360 24 404 787 7. ON 2222 Amino 320 Tab 300 317 346 8. MT Nitrotech 4 Ib 348 459 1840 9. UL Creatine 300 600 134 162 10. UL Muscle Juice 10.45 Ib 110 504 588 11. UN A-pack 4.4 Ib 240 268 312 12. Dy. BCAA Powder 300 Gm. 132 252 262 13. UN A-Stak 240 301 447 14. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1962 is being imposed on such goods; (iii) The differential customs duty of Rs. 11,07,864/- payable on the goods imported vide Bill of Entry No. 8940425 dated 04.01.2013 is demanded and ordered to be recovered from the importer under Section 28(8) of the Customs Act, 1962 along with applicable interest under Section 28AA of the Customs Act, 1962; (iv) Penalty of Rs. 11,07,864/- (Rupees Eleven Lakh Seven Thousand Eight Hundred Sixty Four only) is imposed on the importer under Section 114A of the Customs Act, 1962. However, if the aforesaid duty along with interest payable under Section 28AA is paid within thirty days from the date of communication of this order, the amount of penalty liable to be paid under this section shall be twenty five percent of the duty so determined provided also that the benefit of reduced penalty shall be available subject to the condition that the amount of penalty so determined has also been paid within the period of thirty days referred to above. (v) Penalty of Rs. 2,00,000/- (Rupees Two Lakh only) is imposed on the importer under Section 114AA of the Customs Act, 1962; (vi) Penalty of Rs.1,00,000/- (Rupees One Lakh only) is imposed M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... following case laws: (i) Commissioner of Customs Vs. Modern Overseas [ 2005 SCC OnLine CESTAT 1345 ]; (ii) Neha Intercontinental (P) Ltd. Vs. Commissioner of Customs [ 2006 SCC OnLine CESTAT 1102 ]; (iii) Eicher Tractors Ltd. Vs. Commissioner of Customs [ (2001) 1 SCC 315 ]; (iv) Commissioner of Customs Vs. Polyglass Acrylic Mfg Co. (P) Ltd. [ (2016) 13 SCC 740 ]; (v) Agarwal Industries Vs. Commissioner of Customs [ 2005 SCC OnLine CESTAT 719 ]; (vi) Oswal Fats Oils Vs. Commissioner of Customs [ 2007 SCC OnLine CESTAT 2905 ]; (vii) Commissioner of Customs Vs. J.D. Orgochem Ltd. [ (2008) 16 SCC 576 ] (viii) Kevlin Infotech Pvt. Ltd. Vs. Customs [ 2014 SCC OnLine CESTAT 2328 ] (ix) Commissioner of Customs, Sea Vs. Sri Krishna Sounds and Lightings [ 2018 SCC OnLine CESTAT 6475 ] (x) Additional Secretary to Government of India (Revisional Authority) Order No. [ 214/2021/CUS (WZ)/ASRA/MUMBAI dated 26.08.2021 ] 10. Learned Counsel for the appellant reiterated the above and prayed that the impugned order may be set aside and the appeal may be allowed. 11. Learned Departmental Representative supported the impugned order and submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s on the following case laws : (i) Prasant Glass Works Pvt. Ltd. Vs. Commissioner of Customs, Calcutta [ 1996 (87) ELT 518 (Tri.) affirmed in 1997 (89) ELT A179 (SC) ] (ii) Chandni International Vs. Commissioner of Customs (Import), Mumbai [ 2003 (153) ELT 312 (Tri.-Del.) ] (iii) Toplane Vs. Commissioner of Customs (Preventive), Kolkatta [ 2009 (238) ELT 098 (Tri.-Kol.) ] (iv) Harshita International Vs. Commissioner of Customs (Preventive), Mumbai [ 2008 (229) ELT 386 (Tri.-Mumbai) ] (v) Anil Kumar Tiwari Vs. Commissioner of Customs Tuticorin [ 2016 (344) ELT 1051 (Tri.-Chennai) ] 12. We have considered the submissions made by both sides and perused the records. 13. The primary submission of the appellant is that the data derived from NIDB cannot prove that it has mis-declared the value and, therefore, the transaction value should not have been rejected in terms of Rule 12 of the Valuation Rules. Once the transaction value is not rejected, the value cannot be re-determined as per the Valuation Rules. It is also the submission of the appellant that there is no evidence of additional consideration for sale and that it h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rice is not the sole consideration for the sale or in any other case; (iii) the manner of acceptance or rejection of value declared by the importer or exporter, as the case may be, where the proper officer has reason to doubt the truth or accuracy of such value, and determination of value for the purposes of this section: Provided also that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented under section 46, or a shipping bill of export, as the case may be, is presented under section 50. (2) Notwithstanding anything contained in sub-section (1), if the Board is satisfied that it is necessary or expedient so to do, it may, by notification in the Official Gazette, fix tariff values for any class of imported goods or export goods, having regard to the trend of value of such or like goods, and where any such tariff values are fixed, the duty shall be chargeable with reference to such tariff value. Explanation . - For the purposes of this section - (a) rate of exchange means the rate of exchange - (i) determined by the Board, or (ii) ascertained in such manner as the Board m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and determination of value for the purposes of this section. 18. The Valuation Rules were framed as per the second proviso to sub-section 1 of section 14. It has 13 Rules in all of which Rules 1 and 2 are Preliminary Rules. Rule 3 states that subject to Rule 12, the value shall be the transaction value adjusted according to Rule 10. Rule 10 provides for certain costs to be included in the transaction value. Rule 12 provides for the proper officer to reject the transaction value if he has reason to doubt its truth and accuracy. Thus, unless the proper officer rejects the transaction value under Rule 12, the valuation has to be based on transaction value as per Rule 3 with some additions, if necessary, as per Rule 10. 19. Rule 3 further provides that if the valuation cannot be done under that Rule, i.e., as per the transaction value with additions as per Rule 10, then it must be done sequentially under Rules 4 to 9 . In other words, if the transaction value is rejected under Rule 12 and valuation cannot be done as per the transaction value under Rule 3, then it must be done sequentially under Rules 4 to 9. 20. We now proceed to examine Rules 4 to 9. Rule 4 provides fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od may be adopted without examining the deductive method first (Rule 6). h) If the transaction value is rejected and there is no value of identical goods or similar goods and if it is also not possible to determine the value through deductive method or computational method, then value may be determined through the residual method by the officer following the above principles (Rule 9). 22. The next question which arises is when can the proper officer reject the transaction value. Rule 12 reads as follows: 12. Rejection of declared value. - (1) When the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, he may ask the importer of such goods to furnish further information including documents or other evidence and if , after receiving such further information, or in the absence of a response of such importer, the proper officer still has reasonable doubt about the truth or accuracy of the value so declared, it shall be deemed that the transaction value of such imported goods cannot be determined under the provisions of sub-rule (1) of rule 3. (2) At the request of an importer, the proper officer, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... easonable doubt. If he has such reasonable doubt, then the transaction value can be rejected. The grounds on which the proper officer may raise doubts about the truth and accuracy of the transaction value have been illustrated in explanation 1 (iii) to Rule 12. The list is inclusive and not exhaustive. 24. This takes us to the next question as to whether the officer has correctly rejected the transaction value under Rule 12 and re- determined the value. Rejection under Rule 12 requires firstly that the proper officer has some reason to doubt the transaction value and after calling for additional information and investigation should have a reasonable doubt about the transaction value. Once the officer has a reasonable doubt then it shall be presumed that valuation cannot be done as per the transaction value. In this particular case, the appellant has imported goods from a trader based in Dubai and the imported goods were food supplements. When the prices declared by the appellant were compared with the value of contemporaneous imports as per the data available in the NIDB and also as per the manufacturer s price list, there was a vast difference and in some items the declared pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above, we find that the goods declared transaction value was correctly rejected under Rule 12 of the Valuation Rules by the original authority and such rejection were upheld by the impugned order. 27. Once the declared value is rejected under Rule 12, valuation has to be done sequentially under Rule 4, 5 etc. Rule 4 deals with value of identical goods. Rule 5 deals with the value of similar goods. The original authority has determined the value under Rule 5 finding them to similar to the other goods which were imported. The value of the similar goods were obtained not only from other imports taken from NIDB data but also from the manufacturer s price lists. Under these circumstances, we find nothing incorrect in the order-in-original rejecting the transaction value under Rule 12 re-determining the value as per Rule 5 and demanding the differential duty along with interest and the Commissioner (Appeals) upholding the same in the impugned order. As we have found that the duty short levied was correctly demanded under Section 28, penalty imposed under Section 114A also needs to be upheld and we do so. 28. As far as the penalty under Section 114AA is concerned, it is im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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