TaxTMI 
TaxTMI 
TaxTMI 
2024 (7) TMI 939
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....ies (ISRI). During the disputed period from April 2003 to October 2006, the appellant had imported the said scrap items through the ports of Nhava Sheva, Mumbai, Chennai and Kandla. 1.2 With regard to import of the scrap items, the Directorate of Revenue Intelligence (DRI) had received intelligence that M/s. NICO was indulging in undervaluation of aluminium scrap and zinc scarp of various grades imported from overseas suppliers with an intent to evade payment of customs duty. A team of officers of DRI, Surat and Mumbai had conducted simultaneous searches at the factory/office premises of M/s. NICO and recovered incriminating documents relating to import of disputed goods and recorded the statements of various persons. Scrutiny of the records revealed that M/s. NICO had imported various grades of aluminium scrap and zinc scrap as per the ISRI specification from various overseas suppliers during the disputed period. The value declared by M/s. NICO at time of clearance of the respective import consignments does not appear to be the actual and correct transaction value. Scrutiny of the records recovered/ submitted during the investigation also revealed that, M/s. NICO after April 2006....
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.... always on the prevailing LME on the date of invoices and that the differential amount (actual price 'minus' the invoice value) was routed by M/s. NICO through non-banking channels to their overseas supplier through supplier's representative in India. 2. Feeling aggrieved with the impugned order, the appellants have preferred these appeals before the Tribunal. 3.1 Shri J.C. Patel, learned Advocate appearing for the appellants submitted that rejection of the transaction value of the imported goods, based on the statements of Shri Tushar Porwal and Shri Nitul B. Shah is clearly untenable in law, since the said two persons had soon after the dates of their respective statements, retracted the same and sent their retractions by post to the DRI; that the learned Commissioner has disregarded the said retractions on complete incorrect premise that the proof of retraction had not been submitted before him; whereas, copies of the retractions along with the postal receipts were duly submitted with the reply dated 01.12.2011 and also this was pointed out in the submissions dated 24.01.2019, again enclosing therewith such letters of retraction. Learned Advocate submitted that the adjudicatin....
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....ts of similar goods furnished by the appellant, which were at or about the same price as the imports of the appellant. He further submitted that even assuming, whilst denying, that the appellant's transaction value cannot be accepted under Rule 3(i)ibid and the value has to be re-determined under Rule 3(ii) ibid, by proceeding sequentially through Rules 5 to 8 ibid as contended in the SCN, the value ought to have been determined under Rule 6 ibid, based on the prices of contemporary imports of similar goods, details of which were provided in annexure to the appellant's reply dated 17.6.2014 and in the submissions dated 24.01.2019. He submitted that prices of contemporary imports of similar goods are the same as the prices at which the appellant had made the imports and consequently, these ought to be adopted under Rule 6ibid, and accordingly, there was no differential duty payable by the appellant. 3.4 He also submitted that in a similar case investigated by the same investigating agency viz., DRI, Ahmedabad, in respect of import of goods made by Baheti Metals & Ferro Alloys, Pushpak Metal Corporation and Maliwal Impex P. Ltd and ors., Show Cause Notice F.No. DRI/ AZU/ INV-7/2006 ....
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....ces P. Ltd. - 2013(287)E.L.T. 124 (Tri.-Mumbai) (iv) Sanjivani Non Ferrous Trading Pvt. Ltd. v. C.C.E & S.T., Noida - 2017(7)G.S.T.L. 82 (Tri. -All.) (v) Commissioner of Customs, New Delhi v. Prabhu Dayal Prem Chand - 2010(253)E.L.T. 353 (S.C.) 3.6 As regards the reliance placed in the SCN on evidence gathered from the premises of another importer viz., Associated Aluminium Industries Pvt. Ltd., learned Advocate submitted that the said evidence cannot be relied upon for enhancing the value of imports made by the appellant. He submitted that when the enhancement of value in the case of Associated Aluminium Industries Pvt. Ltd., itself has been set aside by the Tribunal, the question of relying on the evidence found against that importer to enhance the value in case of the appellant, does not arise. 3.7 He also submitted that the findings of Commissioner of manipulation of documents based on two Contracts dated 20-12-2005 are totally untenable in law. The Commissioner has arrived at the said erroneous finding, because he has not considered and has not taken into account the appellant's reply dated 17-6-2014, which clearly contains the explanation in respect of the said two c....
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....ative (AR), appearing for the Revenue, reiterated the findings recorded in the impugned order in support of confirmation of the adjudged demands on the appellants. 5. Heard both sides and examined the case records. 6. We find that in the present case, proceedings were initiated by the department against M/s. NICO, on the premise that they had resorted to undervaluation of zinc scrap and aluminium scrap imported by them during the period April 2023 to October 2006, with the intent to evade payment of customs duty. On the basis of investigation, the value of above scrap items declared by the importer-appellant for the purpose of assessment was rejected and re-determined under Rule 8 of the CVR, 1988. The basic contention of department for redetermination of the value of scrap items was based on the fact that the import price of the said items were much lower than the prevailing prices contained in the bulletin published by the London Metal Exchange (LME). According to the department, the transaction of metallic scrap is dependent upon prevailing prices of prime metal declared in the LME and are arrived at after deducting certain percentage of discount for the impurities found in th....
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.... produced the retractions; however, the learned adjudicating authority has completely ignored their retractions. In the present matter, we noticed that there is absolutely no evidence to corroborate the statements of the above persons, who have retracted the same and also denied their correctness in cross examination conducted during the course of adjudication. There is no corroborative evidence whatever, to show that any amount over and above the invoice price, was paid to the foreign supplier or their representatives in India. Therefore, we find that the department has not placed on record any credible evidence, for rejection of the declared transaction value. It is on record that the appellant has objected to such reliance, as the statements were retracted immediately and the same are contradictory to documentary evidence i.e., contemporaneous import price produced by the appellant. The appellant has pleaded that retracted statements cannot be accepted as evidence for confirmation of demand and the said retraction was immediately sent through postal department for delivery in the office of DRI. The adjudicating authority in the impugned order has chosen for not to consider the r....
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....y the department that the appellant had paid excess amount, over and above the invoice price, is uncorroborated. 8. We also note that the learned adjudicating authority has proceeded to re-determine the value of imported scrap, on the basis of the DGOV circular, without considering and overlooking the contemporaneous data available before him on record. It is a settled position of law that if the declared value is to be rejected, then in that case, for re-determination of the value, the proper officer has to proceed sequentially through Rule 5 to Rule 8 of the CVR, 1988. If the value of contemporaneous imports are available, the same shall be the basis for re-determination of value, as held by the Hon'ble Apex Court in the case of Commissioner of Customs, Calcutta v. South India Television (P) Ltd., reported in 2007 (214) E.L.T. 3 (S.C.). We find that the appellant before the learned adjudicating authority as well as before us has submitted a comparison chart, reflecting the prices of goods imported by them vis-à-vis Baheti Metal (supra) and Pushpak Metal Corpn. (supra). By relying upon such chart, it was contended that the prices declared for the impugned goods by the appe....