TaxTMI 
TaxTMI 
2025 (5) TMI 1288
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....Goods) Rules, 2007 the 2007 Valuation Rules and re-determined under rule 5 of the 2007 Valuation Rules. The goods have also been confiscated but an option has been given to the appellant to redeem the goods on payment of redemption fine. The order also imposes penalty upon the appellant and Mahesh Sabharwal. 2. The appellant imports iron screws/ self-drilling screws from China. A search was conducted at the residence/godown of Mahesh Sabharwal, Director of the appellant on 29.03.2017 and the statement of Mahesh Sabharwal was recorded under section 108 of the Customs Act, 1962 the Customs Act on 13.09.2017 and 14.09.2017. 3. A show cause notice dated 19.09.2019 was issued to the appellant and Mahesh Sabharwal. After referring to the statements made by Mahesh Sabharwal on 13.09.2017, 14.09.2017 and 21.09.2017 under section 108 of the Customs Act, and also to the Panchnama dated 29.03.2017, the show cause notice states as follows: "14. The rates given in the suppliers quotations retrieved from the email of Shri Mahesh Sabharwal shows different rates for different types and sizes of screws (Drywall, Chipboard and Self Drilling Screws) but Shri Mahesh Sabharwal has declar....
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....nclusion that the value of the imported goods (screws) declared by M/s. MMM Overseas Pvt. Ltd to the Customs at the time of import is liable for rejection in terms of Rule 12 of Customs Valuation Rules, 2007 and the value has to be re- determined in terms of Customs Valuation Rules, 2007. 19. In the absence of the value of the identical goods from other source, the value of the goods imported by M/s. MMM Overseas Pvt. Ltd cannot be determined in terms of Rule 4 of Customs Valuation Rules, 2007. It can be re-determined by taking into account the contemporary value of similar goods from other source in terms of Rule 5 of Customs Valuation Rules, 2007. For re-determination of the value of these imported goods, the value of goods imported by Shri Khusagar Aggarwal (derived from the evidences i.e. invoices of actual value retrieved from his email) has been taken as both are importing similar goods at the similar period from the similar Chinese suppliers. Further, the re- determination has also been done on the premise that even for the different suppliers, the rates of similar goods during the similar period can not have such huge difference in their value that is in the rates ....
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....d at ICD, Tughlakabad, New Delhi vide Bills of Entry mentioned in Annexure- A. (vii) M/s MMM Overseas Pvt. Ltd. and Shri Mahesh Sabharwal, for their act of omission and/or commission are liable for penal action under section 112(ii) and/or 114A and 114AA of the Customs Act, 1962." (emphasis supplied) 4. The appellant filed a reply denying the allegations made in the show cause notices. The appellant pointed out that the invoices referred to the show cause notice were of another Chinese supplier provided to M/s Sagar Impex, another Indian importer of screws and, therefore, the e-mail correspondence between another supplier and other receiver of goods was not a valid documentary evidence to reject the transaction value of the goods imported by the appellant. The appellant also pointed out that the statement of Khusagar Aggarwal in the matter of Sagar Impex made under section 108 of the Customs Act could not have been relied upon in the matter of the appellant. It was, therefore, pointed out that the transaction value in the Bills of Entry of the appellant was correct, and even otherwise could not be rejected merely because another person admitted importing goods ....
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....s case and Shri Khusagar Aggarwal in the case of Sagar Impex have confirmed the recovery of said documents from their emails. They have never disowned the said documents/emails nor stated that the laptop/desktop/email from where the said printouts were recovered did not belong to them or were tampered with, so the authenticity of the documents is neither questioned nor doubtful." 8. As regards the rejection of the transaction value, the Principal Commissioner made the following observations: "35. The noticee has contended that the transaction value can be rejected as incorrect value only on the basis of sufficient evidence on record, that the Department has miserable failed in adducing any evidence against the transaction value reflected in the invoice. I do not find the above argument acceptable in the facts of this case. It is an admitted fact that quotation prices from Chinese suppliers of various types of screws in the range of 1150 USD PMT to 1300 USD PMT found on the email of Shri Mahesh Sabharwal, which could not be properly explained. This combined with the absence of any written purchase order or contract and description of goods in the import documents without....
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.... of the imported goods and is liable for rejection in terms of Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. The assessable value of the said goods is liable to be re-determined as Rs.22,10,783/- (Rupees Twenty Two Lakh Ten Thousand Seven Hundred Eighty Three Only) in terms of Section 14(1) of the Customs Act, 1962 read with Rule 5 of the Rules ibid, as detailed in Annexure-A & B of SCN No. 46/2017." 10. Shri Prachit Mahajan, learned counsel for the appellant assisted by Shri Shubham Singh made the following submissions: (i) The Panchnama dated 29.03.2017 does not record the printouts of the e-mail. The reference to the printouts of the e-mail is in the statement of Mahesh Sabharwal recorded under section 108 of the Customs Act on 14.09.2017. No reliance can, therefore, be placed on the printouts of the e-mails, more particularly, when they are not the accompanied by a certificate issued under section 138C of the Customs Act; (ii) The price quotations of various Chinese suppliers retrieved from the e-mail are quotations pertaining to a supplier from whom the appellant had not purchased the goods and even otherwise, the....
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.... placed reliance upon the printout of the e-mails and the statement of Mahesh Sabharwal made under section 108 of the Customs Act to reject the transaction value under rule 12 of the 2007 Valuation Rules. 14. Regarding the printout of the e-mails it needs to be noted that the two panchnamas recorded on 29.03.2017 do not refer to any printout of the e-mails having been taken. In fact, the only reference to the printouts of the e-mails having been taken is contained in the statement of Mahesh Sabharwal recorded under section 108 of the Customs Act on 14.09.2017. The said statement is reproduced below: " On being asked by the DRI officer, I have opened email id [email protected]. The DRI officer has checked the emails and taken printouts of some of the emails. These printouts were given the numbers of 1 to 19. I have gone through these printouts and I state that these are the printouts containing the prices of various types of screws. In these quotations the price of the screws are in the range of 1150 USD PMT to 1300 USD PMT. Now the DRI officer has shown me the Bill of entry No. 8478673 dated 08.02.2017. I have gone through this bill of entry and state that ....
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.... an inquiry has to be first examined as a witness before the adjudicating authority and thereafter the adjudicating authority has to form an opinion whether having regard to the circumstances of the case the statement should be admitted in evidence, in the interests of justice. Once this determination regarding admissibility of the statement of a witness is made by the adjudicating authority, the statement will be admitted as an evidence and an opportunity of cross-examination of the witness is then required to be given to the person against whom such statement has been made. It is only when this procedure is followed that the statements of the persons making them would be of relevance for the purpose of proving the facts which they contain. xxx xxx xxx xxx 28. It, therefore, transpires from the aforesaid decisions that both section 9D(1)(b) of the Central Excise Act and section 138B(1)(b) of the Customs Act contemplate that when the provisions of clause (a) of these two sections are not applicable, then the statements made under section 14 of the Central Excise Act or under section 108 of the Customs Act during the course of an inquiry under the Acts shall be rel....