TaxTMI 
TaxTMI 
2022 (7) TMI 1126
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.... are being passed. 1.1 The brief facts of the case are that Betel nuts imported by the Appellant through the port of Kochi, during the period October 2010 to January 2011 were subjected to adjudication proceedings by the Revenue Authorities under the Customs Act, 1962, alleging undervaluation and violation of EXIM Policy. As per Notification No.49 (RE-2006)/2004-2009 dated 20.02.2007, issued by the DGFT, import of betel buts was allowed only through the port of Mangalore. In addition to this, as per Notification No. 15 (RE-08)/2004-09 dated 04-06-2008, DGFT fixed Minimum Import Price for import of Betel Nuts. Appellant challenged this Notification before the Hon'ble High Court of Kerala in W.P.C No. 9624 of 2007 but pending disposal of the case, the said notification pertaining to port restriction was withdrawn. In the said Writ Petition, Department filed clarification petition and secured orders from the Hon'ble High Court of Kerala, to assess goods independently, keeping the policy aspect aside. Accordingly, the Original Authority conducted assessment and passed Order-in-Original, rejecting the transaction value under Rule 12 (1) and re-determining the same under Rule 5 of the....
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....pellate order are discernible from the Order-in-Appeal, but the order -in- appeals do not reveal such reasons. (vii) That the Hon'ble High Court of Delhi, after considering various definitive pronouncements by the Hon'ble Supreme Court had held in Ranjana Mitra V. Ashok Kumar Mazumdar (MANU/DE/1538/2021) that "it is crystal clear from a mere reading of the impugned judgment that except for citing the submissions made by the parties, the findings and the conclusions of the Trial Court, the First Appellate Court has not dealt with the contentions raised by the Appellant and has not even given any 'reasons' for concurring with the findings of fact and law given by the Trial Court, as also the reasons why the contentions of the Appellant challenging the judgment of the Trial Court were devoid of merit". (viii) That although the above judgment relates to a civil case, the ratio holds good even in the case of consideration of cases under the Customs Act, 1962. Appellants approached the Appellate Authorities/Tribunals being aggrieved by orders passed which have serious civil consequences to them. The authorities have to bestow the same level of care and diligence while d....
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....nt in Punjab Processors case to decide the matter against the Appellant. The order in LeGrand (India) (P) Ltd (2007(216)ELT 678 (Bom), in Videocon International Ltd. case (2010 (261) ELT 220 (T-Mum), in VAG Valves (I) (P) Ltd (2007(212) ELT 90 (T-Chennai), the judgment in Motor Industries Co.Ltd (2009 (244) ELT 4 SC) etc.. were placed before the 1st Appellate Authority, along with a detailed Note, but were ignored. This Hon'ble Tribunal in Global Industries case held that the ratio of the judgment in Radhey Shyam Ratan Lal (2009) 13 SCC 157 was not applicable on the facts of that case. Yet, the 1st Appellate Authority had approved the Order-in-Original which had relied on the ratio of the judgment in Radhey Shyam case. Evidence of bank remittances, and copies of audited balance sheet and P & L were produced, which again were ignored for no reason. In this is nothing short of judicial indiscipline. (xii) That the Original Authority had valued the goods under Rule 5 of CVR after recording that there were contemporaneous goods imported at higher value through other ports. However, the objections raised by the Appellants before the original authority was not considered. ....
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....ious cases. For holding that Rule 5 was applicable, the onus of establishing the import of contemporaneous goods was on the revenue. In the light of the nature of the goods imported by the Appellants, it was for the Revenue to establish that the goods imported contemporaneously through other ports were unprocessed and ungarbled goods. This burden has not been discharged at all by the revenue. (xx) That by merely providing NIDB data (which is the value on which duty was paid) and copies of some BEs, the above onus is not discharged. In the case of agricultural produce such as Betel Nuts, quality, time of crop, time of import, age of the goods (in Betel Nuts older/drier nuts obtain higher value), level of processing etc., impact the value/price. These factors could be determined only through testing. None of the contemporaneous goods and no imported goods were tested. Therefore, to invoke Rule 5 of CVR for rejecting the declared value and assessing the goods at higher values was clearly arbitrary and unsustainable. (xxi) That in all these cases, goods were cleared after paying 50 % of differential duty and providing Bank Guarantee for the remaining value. The Appell....
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....ce rejection of transaction value and its re-fixation is made under Rule 12(1) and 5 of Customs Valuation Rules 2007, we are reproducing the relevant rules as follows; Rule 12:- Rejection of declared value. - (1) When the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, he may ask the importer of such goods to furnish further information including documents or other evidence and if, after receiving such further information, or in the absence of a response of such importer, the proper officer still has reasonable doubt about the truth or accuracy of the value so declared, it shall be deemed that the transaction value of such imported goods cannot be determined under the provisions of sub-rule (1) of rule 3. (2) At the request of an importer, the proper officer, shall intimate the importer in writing the grounds for doubting the truth or accuracy of the value declared in relation to goods imported by such importer and provide a reasonable opportunity of being heard, before taking a final decision under sub-rule (1). Explanation.-(1) For the removal of doubts, it is hereby declared that:- ....
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....ty or both, shall be used, provided that such adjustments shall be made on the basis of demonstrated evidence which clearly establishes the reasonableness and accuracy of the adjustments, whether such adjustment leads to an increase or decrease in the value. (2) Where the costs and charges referred to in sub-rule (2) of rule 10 of these rules are included in the transaction value of identical goods, an adjustment shall be made, if there are significant differences in such costs and charges between the goods being valued and the identical goods in question arising from differences in distances and means of transport. (3) In applying this rule, if more than one transaction value of identical goods is found, the lowest such value shall be used to determine the value of imported goods. Rule 5. Transaction value of similar goods.- (1) Subject to the provisions of rule 3, the value of imported goods shall be the transaction value of similar goods sold for export to India and imported at or about the same time as the goods being valued: Provided that such transaction value shall not be the value of the goods provisionally assessed under section....
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....However, even in adjudication proceedings, the AO has to examine the probative value of the documents on which reliance is placed by the Department in support of its allegation of under-valuation. Once the Department discharges the burden of proof to the above extent by producing evidence of contemporaneous imports at higher price, the onus shifts to the importer to establish that the invoice relied on by him is valid. Therefore, the charge of under-invoicing has to be supported by evidence of prices of contemporaneous imports of like goods. 4.1 Betel nut being an agricultural product, similarity and identical nature of goods can be ascertained only by quality assessment, as the price of betel nuts are largely depended on grade, quality, time of yield, age of the product, level of processing, time of import etc.. Even though Revenue has placed reliance on betel nuts imported through the ports of Chennai and Nhava Sheva, no quality test report is available on records. Even the Betel nuts imported by the Appellants are not tested to ascertain its grade and quality. In the absence of any quality assessment test reports, the contemporaneous nature of goods cannot be ascertained. NID....
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.... Supreme Court held that "a doubt to justify detailed enquiry under the proviso to Section 14 read with Rule 12 should not be based on initial apprehension, be imaginary or a mere prediction on grounds and material in the form of 'certain reasons' and not mere ipse dixit. Subjecting imports to enquiry on mere suspicion because one is distrustful and unsure, without reasonable and certain reasons, would be contrary to the scheme and purpose behind the provisions which ensure quick and expeditious clearance of goods. 4.4 In the case of Global Industries Vs. Commissioner of Customs, Cochin [2011(272)ELT724 (Tri. bang)] it was held that in the absence of data relating to the imports of goods of same quality, quantity and commercial level with higher transaction value, contemporaneous import cannot be accepted. In this instant case, Revenue has not placed any data to evidence contemporaneous imports; rather the Adjudicating Authority found that there are no contemporaneous imports. 4.5 We find that both Original Authority as well as Appellate Authority have not applied their mind in as much as rejection of transaction value and its re-fixation has been made without follow....