2015 (2) TMI 335 - AT - Customs

Tribunal overturns order enhancing assessable value under Customs Act

MAKALU TRADING LTD. Versus COMMISSIONER OF CUSTOMS, MUMBAI

The Tribunal allowed the appeals, setting aside an order enhancing the assessable value under Sec. 14(1) of the Customs Act, 1962. The Tribunal found that ... Valuation of goods - Enhancement of the value under Sec. 14(1) of the Customs Act, 1962 - Held that:- Out of the total 8 cases, in 6 cases the country of origin is different and in remaining 2 cases we find that the contemporaneous value taken for loading the value is from the imports made by the appellants only and in that case the quantum of import was 2 to 3 times more. Therefore, it cannot be treated as contemporaneous price and the action of the department in enhancing the value is not sustainable in law. Therefore, the impugned order is set aside - Decided in favour of assessee. Issues:1. Appeal against order enhancing assessable value under Sec. 14(1) of the Customs Act, 1962 based on contemporaneous import prices.Analysis:The appellants filed appeals against an order by the Commissioner of Customs (Appeals) upholding the adjudication order enhancing the assessable value based on contemporaneous import prices. The case involved the import of M.S. Strips/CR Electrogalvanised/Galvanised/Strips/Sheets, Seconds/defective, with 4 Bills of Entry filed for clearance. The department sought to load the value based on contemporary import prices @ US $ 210 PMT. The lower adjudicating authority ordered the enhancement under Sec. 14(1) of the Customs Act, 1962. The appellants contended that the country of origin differed in 6 out of 8 cases, and in the remaining 2 cases, the comparable price for loading the value was based on their own imports with higher quantities. They argued that this could not be considered contemporaneous import pricing as the imports were made 3 to 4 months earlier.Upon considering the submissions and records, the Tribunal found that in 6 out of 8 cases, the country of origin differed, and in the remaining 2 cases, the contemporaneous value used for loading the value was from the appellants' own imports, with significantly higher quantities. The Tribunal held that this could not be deemed as contemporaneous pricing, and the department's action in enhancing the value was not legally sustainable. Consequently, the impugned order was set aside, and the appeals were allowed. The Tribunal's decision was based on the lack of contemporaneous import data and the disproportionate quantities in the comparable imports used to enhance the assessable value.