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of <h1>Tribunal overturns Customs decision on PVC fabric value, upholds declared invoice value.</h1> <h3>Suvee Impex Pvt Ltd Versus Commissioner of Customs And Service Tax Bangalore-Cus</h3> The Tribunal set aside the Customs Authorities' decision to enhance the value of imported PVC coated polyester fabric based on subsequent imports and a ... Demand of differential duty - Undervaluation of goods - Held that:- There is no reference by the Revenue to any contemporaneous import declaring the price of identical goods at a higher value. The only reference is to those imports where the value was enhanced by the Customs Authorities based upon the letter of Commissioner of Customs (Imports) Nhava Sheva, Bombay. Merely because the value was enhanced by the Customs, the same would not become contemporaneous imports. In the present case also, the Customs have enhanced the value and the present enhancement cannot be considered to be contemporaneous for the other subsequent imports. - The value declared by the appellant is on the basis of the contracts entered into by them with the foreign supplier. There is no evidence on record that the value as declared in the invoices is not the correct value or is not in terms of the contract or any under-hand consideration has flown back to the supplier. The reliance on the letter of Commissioner of Customs (Imports) Bombay, which in any case has not been placed before us cannot be adopted as the sole reason for enhancement of the price. - enhancing the value based on cost construction method cannot be held to be a proper method to decide upon the value of the goods, especially when there is no evidence of any consideration flowing back to the foreign supplier. Adjudicating authority has observed that till February 2013, the lower assessable value was being accepted and the goods were being cleared by the Customs. If that be so, we find no justifiable reasons to enhance the value based upon some other enhancement order of the proper officer under the Customs and to hold the same as contemporaneous. The impugned orders are unsustainable - Decided in favour of assessee. Issues:1. Valuation of imported goods based on contemporaneous imports.2. Rejection of declared value by Customs Authorities.3. Legal sustainability of valuation methodology.4. Consideration of evidence in valuation disputes.5. Application of Customs Valuation Rules and circulars.Analysis:Issue 1: The appeals involved a common issue of valuation of imported PVC coated polyester fabric. The appellant contended that the value declared in the invoices reflected the genuine transaction value as per the contracts with foreign suppliers. The Revenue initiated proceedings for enhancement of value based on the assertion of under-valuation.Issue 2: The original adjudicating authority enhanced the value of goods citing subsequent imports and a formula detailed by the Commissioner of Customs. The appellate authority upheld this methodology, considering it legally sustainable due to the absence of contemporaneous imports of identical goods. This led to the rejection of the appeal by relying on the Commissioner's letter.Issue 3: Upon careful consideration of submissions, the Tribunal noted that while some subsequent imports had enhanced values, there was no reference to contemporaneous imports declaring higher values. The Tribunal emphasized that the value declared by the appellant was based on contractual agreements with foreign suppliers, and there was no evidence to dispute the correctness of the declared value.Issue 4: The Tribunal referred to legal precedents, highlighting that the Revenue must provide evidence to rebut the correctness of declared values. The Tribunal cited cases where reliance on circulars and cost-based methodologies for valuation enhancement was deemed improper without concrete evidence or considerations flowing back to the supplier.Issue 5: The Tribunal concluded that the Revenue failed to reference contemporaneous imports or provide evidence to challenge the invoice value. It emphasized that the enhancement of value based on orders of the Customs without justifiable reasons was unsustainable. As a result, the impugned orders were set aside, and all appeals were allowed in favor of the appellants.
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