2008 (3) TMI 139 - AT - Customs

Tribunal rejects department's appeal on arbitrary value enhancement, upholds Commissioner decision

COMMR. OF CUS., AMRITSAR Versus POLYGLASS ACRYLIC MFG CO. P. LTD.

The Tribunal upheld the decision of the Commissioner (Appeals) in favor of the importer, emphasizing the lack of a clear basis for the value enhancement ... Enhancement of value was set aside by commissioner on ground that there was nothing on record to show that the assessable value declared by the importer was not the sole consideration for sale – revenue submit that the importer having accepted the enhancement and having not asked for any speaking order should not have been granted relief – held that Enhancing the assessable value without giving an opportunity to the importer looks arbitrary – revenue appeals are rejected Issues:Department appealing against Commissioner (Appeals) order enhancing value of imported Acrylic Strips without basis. Importer accepting enhanced value to avoid demurrages. Comparison of import details and assessment orders for value enhancement.Analysis:The case involved appeals by the department against the order of the Commissioner (Appeals) regarding the enhanced value of imported Acrylic Strips without a clear basis. The respondent importer had accepted the enhanced value to avoid demurrages and filed appeals against the assessment orders. The department argued that since the importer accepted the enhancement without requesting a speaking order, relief should not have been granted by the Commissioner (Appeals). The department also presented a bill of entry from another importer to show the declared value of similar goods. However, the Commissioner (Appeals) allowed the importer's appeal, stating that there was no evidence to suggest that the declared value was not the sole consideration for sale.Upon hearing both sides, the Tribunal noted that the value enhancement was done without a clear basis. Although the bills of entry had endorsements accepting the value loading, there was no explanation provided for the enhancement. The Tribunal also reviewed a bill of entry from a contemporaneous import, highlighting the varying dimensions of the imported strips. The Tribunal found overlapping dimensions between the disputed imports and the comparison import, making it difficult to draw a reliable inference for value comparison. The Tribunal concluded that enhancing the assessable value without giving the importer an opportunity seemed arbitrary, and the decision of the Commissioner (Appeals) to allow the importer's appeals was not unreasonable. Therefore, the Tribunal rejected the department's appeals, stating that no valid grounds were presented to interfere with the Commissioner (Appeals) order.In summary, the Tribunal upheld the decision of the Commissioner (Appeals) in favor of the importer, emphasizing the lack of a clear basis for the value enhancement and the difficulty in making a valid comparison between imports. The Tribunal found the value enhancement arbitrary and rejected the department's appeals, affirming the Commissioner (Appeals) order.