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TMI Blog2008 (8) TMI 310X X X X Extracts X X X X X X X X Extracts X X X X ..... set aside the impugned order. The appeal is allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... action value, importers acquiesced in an enhancement of declared value for assessment and at times not finally accepting the same. Relying on such value as price of contemporaneous imports to determine assessable value may not be proper as the assessed value may change in appeal proceedings. 4. In the subject case, SCN was waived. Rule 12 of CVR 2007 provided for asking the importer to explain why the declared price should not be rejected. After hearing the importer and enquiry, value could be accepted or revised following the CVR sequentially. In the instant case the genuineness of transaction value was doubted solely for the fact that there were contemporaneous imports at higher value. Without further enquiry the doubt became the ground to reject the transaction value and the value was enhanced. This w not envisaged in law. The importer should not be asked to justify how some other importer purchased similar or identical goods at a higher value. The onus was on the department to establish that the declared value was depressed for noncommercial reasons for which the same was not acceptable. Pushpanjali was a regular exporter of finished silk and had established a rapport with its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere are contemporaneous imports of identical/similar goods at significantly higher values and ask the importer to substantiate the declared value. We find that the assessing officer (AO) had no ground to doubt the veracity of the declared value as per this rule in view of similar values declared in several imports. The AO not only initiated enquiries doubting the declared value as not genuine for the reason that there were imports of such goods at higher unit prices but rejected the transaction value for the same reason. The statute does not provide for rejecting the transaction value for such reasons. As per the relevant Section 14 of the Customs Act '62 (the Act), transaction value is the consideration paid or payable for the goods imported for delivery at the time and place of importation where the importer and the supplier are not related and if related, the relationship had not influenced the transaction. Transaction value cannot be rejected for the reason that the same is lower than the range of prices at which such goods are imported contemporaneously. There is no finding that the transaction value was under declared. 7.1 We find that the Commissioner (Appeals) had observed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces, including commissions and brokerage, engineering, design work, royalties and licence fees, costs of transportation to the place of importation, insurance, loading, unloading and handling charges to the extent and in the manner specified in the rules made in this behalf: Provided further that the rules made in this behalf may provide for,- (i) the circumstances in which the buyer and the seller shall be deemed to be related; (ii) the manner of determination of value in respect of goods when there is no sale, or the buyer and the seller are related, or price 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. There is no finding that the declared value is not the tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to value; (f) the fraudulent or manipulated documents. These provisions do not empower the AO to reject the transaction value without establishing that the transaction value was not genuine. In the case law Rashesh & Co. v. CC, Mumbai - 2008 (227) E.L.T. (573) (Tri.-Mum) (supra) cited the Tribunal observed as under "We find merit in the submission of the applicants that the transaction price can be rejected only if the exceptional circumstances stipulated in Rule 4(2) of the Valuation Rules are found to be attracted, as held by the Apex Court in Eicher Tractors Ltd. v. CC - 2000 (122) E.L.T. 321 (S.C.). In the present case, the transaction value has been rejected on the ground that the sale was not in the ordinary course of trade under fully competitive conditions and this finding has been arrived at on the ground that other importers were in porting the same goods from the same country at around the same point of time at higher prices. This, however, is not legally permissible, as held by the Tribunal in the case of Mark Auto Industries Ltd. v. CC, New Delhi - 2003 (162) E.L.T. 261 and Devika Trading Pvt. Ltd. v. CC, Mumbai - 2004 (167) E.L.T. 75. Since the only basis for reje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14) E.L.T. 3 (S.C.)] endorsed the same views. "Therefore, the transaction value under Rule 4 must be the price paid or payable on such goods at the time and place of importation in the course of international trade. Section 14 is the deeming provision. It talks of deemed value. The value is deemed to be the price at which such goods are ordinarily sold or offered for sale, for delivery at the time and place of importation in the course of international trade where the seller and the buyer have no interest in the business of each other and the price is the sole consideration for the sale or for offer for sale. Therefore, what has to be seen by the Department is the value or cost of the imported goods at the time of importation, i.e., at the time when the goods reaches the customs barrier. Therefore, the invoice price is not sacrosanct. However, before rejecting the invoice price the Department has to give cogent reasons for such rejection. This is because the invoice price forms the basis of the transaction value. Therefore, before rejecting the transaction value as incorrect or unacceptable, the Department has to find out whether there are any imports of identical goods or similar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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