TaxTMI 
TaxTMI 
2025 (10) TMI 826
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....mination of Value of Imported Goods) Rules, 2007 read with Section 14 of the Customs Act, 1962. (ii) I determine the collective amount of Rs. 8,40,16,707/-(Rupees Eight Crores Forty Lakhs Sixteen Thousand Seven Hundred and Seven only), which include adjustment of freight, insurance and handling charges, as actual transaction value in respect of goods covered under Bills of Entry, as detailed in Table II & III to the Show Cause Notice, under Rule 3 & 9 of Customs Valuation (Determination of Value of Import Goods) Rules, 2007 read with Rule 10(2) of the Customs Valuation (Determination Value of Imported Goods) Rules, 2007 and Section 14(1) of the Customs Act, 1962. (iii) I hold that total duty amounting to Rs. 2,49,86,167/- (Rupees Two Crores Forty Nine Lakhs Eighty Six Thousand One Hundred Sixty Seven only) should be charged under section 12 of the Customs Act, 1962 read with Section 2 &3 of the Customs Tariff Act, 1975 in respect of goods covered under the Bills of Entry, as detailed in Table - II & III of the Show Cause Notice, and confirm the demand of differential duty of Rs. 1,85,8,364/- (Rupees One Crore Eighty five Lakhs Eighty Four Thousand Three Hundred Si....
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[email protected], [email protected] and [email protected]. Invoices would be sent from three email id's of the supplier viz, [email protected], [email protected] and [email protected]. 5. Nitin also opened his email account [email protected] using the computer installed in room of the Special Intelligence and Investigation Branch [SIIB] voluntarily and took a printout of the original invoices in excel form which he had received from [email protected] and put his signature certifying it. The data contained in the email and the excel sheets were collected by SIIB officers. His further statement was recorded on 17.07.2018 in which he re-affirmed that he had opened his email id while giving his statement on 9.01.2018 and had taken printouts of the excel sheets which he had signed. He stated that the prices therein were on CIF basis. 6. During investigation, it emerged that apart from imports by Wide Impex there were also invoices pertaining to consignments imported by Royal Blankets (owned by Nitin) - the appellant herein- in the excel sheet in the email of [email protected]. This led to the investigation against the appellant. 7.....
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....ile coco and cherry files for accurate information cbm weight and value." Similarly in another email dated July 1 with subject "USD RMB", the conversation says "kindly find file attached for the 2nd June (USD and RMB) values for PVC, cushion mat have not been mentioned, 9th June (RMB) waiting for a man invoice, 21st June (RMB)". He also recorded that the information given in the Excel sheets indicated that the goods were first purchased from different sellers whose names were indicated in codified form in column 'Shop' and the buyer's name in 'Mark column. 10. When the prices in RMB in the Excel sheets were compared with the commercial invoices indicating prices in USD, the description of the goods, number of cartons, total number of cartons, etc. fully matched. Therefore, the Principal Commissioner concluded that the goods were purchased by the importer's agent from suppliers in China and given to the consolidator to supply the goods to India who prepared invoices heavily undervaluing and indicated the values in USD which were produced before Customs to clear goods. The real values in RMB were sent to the importer on email and were never disclosed to the Customs. 11. In resp....
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....(Amount in Rs.) Actual transaction value of goods in terms of Rule 10(2) of CVR, 2007, as per actual invoice recovered from email id of Shri Nitin Khandelwal (in Rs.) Total Duty payable (Amount Rs.) in Duty already paid as per Bill of Entry (Amount in Rs.?) Diff. Duty to be (Amount Rs.) paid in Detail of duty calcula tion on annexu re (RUD) 1 3681219 30.10.2013 563957 4837571 1395736 184475 1211261 7 2 2255279 14.08.2015 616670 2820720 830449 181554 648895 8 3 2483297 04.09.2015 1069733 2639091 751463 298813 452649 9 4 2584182 14.09.2015 955915 3553256 1035570 260203 775367 10 5 2679253 22.09.2015 1198825 4551585 1332794 204494 1128300 ....
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....valuation to be done on the basis of value of identical goods. Since the goods were assorted and different items were sourced from different sellers, the Commissioner found that they cannot compared and, therefore, Valuation Rule 4 could not be applied. For the same reason, he also found that Valuation Rule 5 (value of similar goods) also could not be applied. Valuation Rule 6 only provides that Valuation Rule 8 can be applied before the Valuation Rule 7 if the importer so desires. Thus, it is not an actual method of determining the value. The Commissioner found that Valuation Rule 7 (deductive method) could not be applied in the case because there was no one-to-one co-relation between the goods found in the market and the imported goods. He also found Valuation Rule 8 deals with computed value calculated on the basis of cost of production manufacturing etc., which also could not be applied. Therefore, he determined the value as per Valuation Rule 9 which provides for determination of value using reasonable means consistent with the principles and general provisions of these rules. 14. In order to determine the value under this Valuation Rule, he adopted the values of similar go....
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....er dated 8.3.2019, upheld such re-assessment. confirmed only on the basis of presumption. The value is now further enhanced in the impugned order which is not permissible; (f) In respect of Bill of Entry No. 6985117 dated 5.10.2016, anti-dumping duty of Rs. 79,947/- has been imposed. While the appellant gave a reply on this issue, no finding has been given in the impugned order; (g) The Excel sheet on which the SCN and the impugned order relied was not accompanied by a certificate in section 138C of the Act and hence it cannot be relied upon; (h) Penalty under section 114AA could not have been imposed because this section covers only mis-declaration in the case of exports as is evident from the 27th Report of the Standing Committee on Finance. The quantum of penalty imposed is also exorbitant; (i) The impugned order may be set aside and the appeal may be allowed with consequential relief. 18. Learned authorized representative appearing for the department has made the following submissions: (a) During investigation into Wide Impex, it was found that the appellant had also undervalued the goods. Nitin was the person behind both these ca....
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....ct in imposing anti-dumping duty on goods imported by Bill of Entry dated 6985117 dated 5.10.2016 without recording any findings on the question of anti-dumping duty? (v) Whether the Excel sheet can be relied upon without a certificate under section 138C of the Act? 21. Investigation in this case is an offshoot of the investigation in Wide Impex of which Nitin was the manager. Suspecting undervaluation, Mayank was summoned and Nitin appeared on his behalf in connection with the investigation to Wide Impex and gave a statement on 09.01.2018 explaining his modus operandi in undervaluation of the goods. According to him, the person in China, Shri Anuj Gupta, would supply him goods and two sets of invoices-the correct invoice in which value is shown in RMB and a fake invoice showing a much lower value in US dollars. He also gave details of his email accounts and email accounts of Anuj Gupta. He further confirmed that he would receive invoices on those email from Anuj Gupta. He then opened his email account in the office of SIIB, took prints of the emails and put his signature certifying them. The details of the actual prices of each good was present in the form of excel she....
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....nsaction value; where the declared value is rejected, the value shall be determined by proceeding sequentially in accordance with rules 4 to 9. (ii) The declared value shall be accepted where the proper officer is satisfied about the truth and accuracy of the declared value after the said enquiry in consultation with the importers. (iii) The proper officer shall have the powers to raise doubts on the truth or accuracy of the declared value based on certain reasons which may include - (a) the significantly higher value at which identical or similar goods imported at or about the same time in comparable quantities in a comparable commercial transaction were assessed; (b) the sale involves an abnormal discount or abnormal reduction from the ordinary competitive price; (c) the sale involves special discounts limited to exclusive agents; (d) the misdeclaration of goods in parameters such as description, quality, quantity, country of origin, year of manufacture or production; (e) the non declaration of parameters such as brand, grade, specifications that have relevance to value; (f) the fraudulent or manipulated docu....
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....nd 5 it should be determined as per Valuation Rules 7 or 8 and at the request of the importer Valuation Rule 8 could be adopted before following rule 7. 30. Valuation Rule 7 provides for deductive method of determining the value i.e., the value of identical or similar goods which are sold in India in the greatest aggregate quantity must be reckoned and from it, deduction should be made on account of commissions, margins, transport, insurance, customs duties and other taxes payable in India. In other words, we should reckon the domestic price of the goods in India and work backwards allowing deductions to determine the value for customs purposes. 31. Valuation Rule 8 provides for determination of the value on the basis of the cost of manufacture, reasonable profit, expenses etc. 32. Valuation Rule 9 provides that if the value cannot be determined under any of the provisions, rules there shall be determined using reasonable means consistent with the general principles of general provisions and on the basis of data available in India. 33. The Commissioner has followed Valuation Rule 9 after recording that the deductive method under Valuation Rule 7 or the computed value un....
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....heets recovered from the email of the proprietor. We find no force in this submission. In emails, one does not put one's signature and stamp even otherwise. When one is obtaining parallel invoices to evade duty, it will be much less so. It is a matter of record that excel sheet was printed by Nitin from his email account during investigation and that he also signed and submitted it. 40. Learned counsel also submitted that the email was opened during another investigation which covered only six Bills of Entry pertaining to the appellant and the goods in the remaining 17 Bills of Entry do not match in all respects. We find that it is for this reason, that the Principal Commissioner re-determined the values under Rule 9 of the Valuation Rules. 41. Learned counsel also submitted that the statement was given by Nitin in connection with the investigation under M/s. Wide Impex. However, we find that Nitin was managing imports by three firms- imports by Wide Impex owned by his brother as Manager, imports by the appellant (Royal Blankets) as its owner and imports by M/s. KLM Overseas as its partner. He explained his modus operandi and in the Excel sheet which he produced, the invoices....
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.... or images embodied in such micro film (whether enlarged or not); or (b) a facsimile copy of a document; or (c) a statement contained in a document and included in a printed material produced by a computer (hereinafter referred to as a "computer printout"), if the conditions mentioned in sub-section (2) and the other provisions contained in this section are satisfied in relation to the statement and the computer in question, shall be deemed to be also a document for the purposes of this Act and the rules made thereunder and shall be admissible in any proceedings thereunder, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible. (2) The conditions referred to in sub-section (1) in respect of a computer printout shall be the following, namely :- (a) the computer printout containing the statement was produced by the computer during the period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on over that period by the person having lawful control over the u....
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....tion of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it. (5) For the purposes of this section, - (a) information shall be taken to be supplied to a computer if it is supplied there to in any appropriate form and whether it is so supplied directly or(with or without human intervention) by means of any appropriate equipment; (b) whether in the course of activities carried on by any official, information is supplied with a view to its being stored or processed for the purposes of those activities by a computer operated otherwise than in the course of those activities, that information, if duly supplied to that computer, shall be taken to be supplied to it in the course of those activities; (c) a document shall be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of any appropriate equipment. Explanation . - F....
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....as determined under subsection (2) of section 28 shall also be liable to pay a penalty equal to the duty or interest so determined: Provided that where such duty or interest, as the case may be, as determined under sub-section (4) of section 28, and the interest payable thereon under section 28-AB, is paid within thirty days from the date of the communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent. of the duty or interest, as the case may be, so determined: Provided further that the benefit of reduced penalty under the first proviso shall be available subject to the condition that the amount of penalty so determined has also been paid within the period of thirty days referred to in that proviso: Provided also that where the duty or interest determined to be payable is reduced or increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the Court, then, for the purposes of this section, the duty or interest as reduced of increased, as the case may be, shall be taken into account: Provided also tha....
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....material. If a person knowingly or intentionally makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document which is false or incorrect in any material particular, in the transaction of any business for the purposes of this Act, shall be liable to a penalty not exceeding five times the value of goods." 49. A plain reading of the section shows that the person who knowingly makes any false declaration statement or produces a document which is false or incorrect in any material particular in the transaction of any business for the purposes of this Act, shall be liable to a penalty under Section 114AA. Bills of Entry are certainly documents meant for transaction under the Customs Act. There is nothing in the text of section 114AA which shows that it applies only to exports and does not apply to imports. Learned counsel relied on the 27th Report of the Standing Committee of the Finance in support. We have examined it. The Committee had expressed concerns about the introduction of an additional section 114AA as it was considered harsh. In response, the Ministry explained that this has been introduced consequent upon several cases of fra....