2004 (8) TMI 140 - AT - Customs

Tribunal Rules: No Extended Limitation Without Evidence of Collusion; Requires Authentic Docs for Value Assessment.

The Tribunal allowed the Appeals of the Appellants, ruling that the extended period of limitation under Section 28 of the Customs Act cannot be invoked ... Valuation (Customs) - Enhancement of the value of goods - Mis-declaration of Import value - Discrepancies between the declared value in invoices and the Export Declaration obtained from the foreign supplier - Demand - Limitation - Imports watch cases, watch dials, leather straps, winding knobs and watch hands - HELD THAT:- There is also no material to show that they have paid any amount in addition to the price declared in the invoices to their foreign suppliers. Thus in absence of any material to show collusion between the Appellants and the foreign suppliers, the Revenue cannot claim that the Appellants had declared less value of the impugned goods imported under Bills of Entry at Serial Nos. 2 to 5 with an intent to evade payment of duty. Consequently, the extended period of limitation as provided in Section 28 of the Customs Act cannot be invoked for demanding duty in respect of these Bills of Entry. Accordingly the Appeals filed by M/s. Raj Watch Manufacturers and M/s. Tatio Watch Manufacturers are allowed with consequential relief, if any. The Tribunal has also taken note of the decision in the case of Rainbow Gold Products P. Ltd. v. C.C., [1995 (3) TMI 283 - CEGAT, NEW DELHI] laying down that photocopy of the export declaration without the signature of any Customs officials, without any Customs seal, is not the relevant documents. In view of the decisions of the Tribunal the assessable value cannot be enhanced solely on the basis of such a declaration. The Revenue has to compare the prices with the contemporaneous imports for the purpose of determining the assessable value. Even in the case of Indian Watch Parts Mfg.[2004 (2) TMI 196 - CESTAT, NEW DELHI], relied upon by the learned SDR, the Revenue had adduced the comparable import price which was closer to the export declaration which weighed with Tribunal to conclude that this 'clearly shows that mis-declaration of value is made in the import invoices rather than in the export declarations.' Accordingly we remand the matter for re-determination of assessable value in respect of Bill of Entry No. 1638, dated 19-11-97. In conclusion, all the Appeals were disposed of based on the findings related to the authenticity of documents and the absence of collusion between the importers and foreign suppliers. The Tribunal emphasized the need for clear and genuine evidence in determining the assessable value of imported goods. Issues involved: The judgment involves the issue of enhancement of the value of goods imported by the Appellants based on discrepancies between the declared value in invoices and the Export Declaration obtained from the foreign supplier.Details of the Judgment:1. The Appellants imported goods based on invoices from a foreign supplier, with some goods being assessed to duty and others being seized. Subsequently, show cause notices were issued alleging undervaluation. The Commissioner confirmed the duty demand, penalties, and confiscation of goods, citing discrepancies between declared values and Export Declaration. The Appellants argued that without collusion with the supplier, the extended period of limitation for demanding duty cannot be invoked. They relied on legal precedents mandating acceptance of invoice value unless specific circumstances exist to reject it.2. The Appellants contended that the Export Declaration cannot be the basis for enhancing the assessable value due to lack of clarity and authenticity in the document. They argued that without evidence of collusion or special circumstances, the declared transaction value should be accepted. The Revenue, however, claimed that discrepancies in the Export Declaration indicated an intent to evade duty.3. The Tribunal considered both arguments and found that without evidence of collusion between the Appellants and the foreign suppliers, the extended period of limitation under Section 28 of the Customs Act cannot be invoked. As a result, the Appeals by two of the Appellants were allowed. Regarding a specific Bill of Entry, the Tribunal noted the lack of the original Export Declaration and emphasized the need for genuine documents to enhance the assessable value.4. Citing previous decisions, the Tribunal highlighted the importance of authentic documents in determining assessable value. It emphasized that photocopies without proper authentication cannot be the sole basis for rejecting transaction value. The Tribunal remanded the matter for re-determination of assessable value in a specific case where the original Export Declaration was not presented.5. In conclusion, all the Appeals were disposed of based on the findings related to the authenticity of documents and the absence of collusion between the importers and foreign suppliers. The Tribunal emphasized the need for clear and genuine evidence in determining the assessable value of imported goods.