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TMI Blog2024 (1) TMI 1128X X X X Extracts X X X X X X X X Extracts X X X X ..... ares the transaction value and self-assesses the shipping bill as per his understanding which must be accepted unless there is reasonable doubt by the proper officer. And this reasonable doubt cannot be based on the mere opinion of some DRI officers who physically examined the goods. It is surprising that the Joint Commissioner adjudicated the matter solely based on the subjective opinion of the DRI officers ignoring all the documents on record produced by the appellant in support of transaction value. The entire case of the Revenue is that the opinion of the officers of DRI who inspected the goods that they were over-valued is sufficient to form a reasonable doubt regarding the transaction value in the shipping bills and reject it under rule 8, regardless of all the documents produced by the appellant including the bank realization certificates which reflect the transaction value. Nothing in the Act or the Export Valuation Rules provide for rejection of the transaction value based on the intelligence received by the officers of DRI or their subjective opinion rejecting the value of the goods. Needless to say, such an order cannot be sustained. Once the rejection of the trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vain because there were no such goods in the market and they were made exclusively for exports. Thereafter, the officers re-determined the value under rule 5 and rule 6 combined, based on the cost of manufacture of the goods. The officers also took the samples of the seized goods to the market and sought the opinion of one, Shri Nitin Jain, proprietor of M/s Manglam Trading Company, New Delhi who is a manufacturer and trader of readymade garments. 5. Based on the opinion of Shri Jain and the cost of manufacture calculated by the DRI, a show cause notice dated 18.12.2017 was issued by the Joint Director of DRI calling upon the appellant to show cause to the Joint Commissioner of Customs, ICD, Tughlakabad as to why the declared export value should not be rejected and it should not be taken as the lower value determined by the officers of DRI. It was also proposed to confiscate the seized export goods under section 113 (i) of the Customs Act and to impose penalties under section 114 and 114AA. The Joint Commissioner, in his order dated 06.07.2018, scanned and pasted the entire show cause notice and then recorded his discussion and findings and confirmed all the proposals in the sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer shall have the powers to raise doubts on the declared value based on certain reasons which may include - (a) the significant variation in value at which goods of like kind and quality exported at or about the same time in comparable quantities in a comparable commercial transaction were assessed. (b) the significantly higher value compared to the market value of goods of like kind and quality at the time of export. (c) the misdeclaration of goods in parameters such as description, quality, quantity, year of manufacture or production. 8. She submits that this rule requires the proper officer to first have some reason to doubt the truth and accuracy of the transaction value. Thereafter, he can call for further information or documents from the exporter and if no documents or information is provided or after considering the documents and information which have been provided, if the proper officer still has a reasonable belief that the transaction value was not true and accurate it can be rejected. Unless this threshold of rejection of transaction value under rule 8 is crossed, valuation cannot be done under export valuation rules 4 to 6. 9. She further submits th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t a market enquiry were unsuccessful because there were no goods of like quality in the market. Nevertheless, they formed an opinion that the goods were overvalued based on their judgment as to what he value of the export goods should be and on the opinion of a trader not connected with the export. They went further believed that because of this over valuation, the export goods were liable for confiscation and seized them and issued the SCN. 14. The Joint Commissioner adjudicating the matter held that there was reasonable doubt about the correctness of the transaction value declared by the exporter in relation to the goods attempted to be exported and, therefore, rejected it under rule 8. He found this reasonable doubt on the basis of the visual examination of sample goods by DRI officers in the presence of the Authorized Representative of the exporter on 18.08.2017 which revealed that the quality of goods was sub-standard and the value of the goods was over stated . Thus, the sole basis for rejection of transaction value was the subjective opinion of the officers of DRI who examined the goods. After recording these observations in paragraph 4.1 of the Order-in-Original and rej ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is required as held by Hon ble Tribunal in case of Sunil Kumar Gilra vs. Commissioner of Customs (Exp.), Nhava Sheva [2019 (370) ELT 1553(Tri.-Mumbai)]. 5.6 Challenge to penalty under Section 114AA is also not sustainable as the Appellant made a wrong declaration and they failed to produce any evidence that the wrong declaration was not intentional. 16. We find it necessary to first examine the rejection of transaction value under rule 8 by the Joint Commissioner and the affirmation of its rejection in the impugned order because if this rejection is found to be incorrect, rest of the impugned order will not survive. 17. Rule 8 clearly provides that if the proper officer has reason to doubt in the first place, he can call for further information and documents and after examining them or if they are not provided if he still has reasonable doubt that the declared transaction value is not true and accurate, it can be rejected. We find that in this case the proper officer had no doubt at all. The officers of DRI, based on intelligence and their subjective opinion and the opinion of another trader, doubted the transaction value and proceeded to seize the consignment and issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the remittances which they received were equal to the amounts indicated in the shipping bills as transaction values. The Commissioner (Appeals), however, dismissed this submission and in paragraph 5.4 of the impugned order stated that the Bank Realization Certificates alone are not sufficient to establish the bona fide of the appellant. 20. In other words, the entire case of the Revenue is that the opinion of the officers of DRI who inspected the goods that they were over-valued is sufficient to form a reasonable doubt regarding the transaction value in the shipping bills and reject it under rule 8, regardless of all the documents produced by the appellant including the bank realization certificates which reflect the transaction value. Nothing in the Act or the Export Valuation Rules provide for rejection of the transaction value based on the intelligence received by the officers of DRI or their subjective opinion rejecting the value of the goods. Needless to say, such an order cannot be sustained. 21. Once the rejection of the transaction value under rule 8 is found to be not tenable, its re-determination, consequential confiscation of the export goods and imposition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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