TaxTMI 
TaxTMI 
TaxTMI 
2026 (3) TMI 161
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....e Special Valuation Branch to examine whether the relationship between the parties influenced the price under Rule 3(3) of the Customs Valuation Rules, 2007. 1.3 A total of 72 Bills of Entry were examined by the SVB. The SVB held that the parties were related under Rule 2(2)(i) and (iv) and rejected the declared value in respect of 11 Bills of Entry on the ground that the declared value per kg was significantly lower than earlier imports of the same importer, and thereby re-determining the value under Rule 4 based on contemporaneous imports of similar goods by the same importer and directing that for future imports where the declared value was less than Rs.300 per kg, the value should be aligned with contemporaneous imports or the minimum benchmark under DGOV's guidelines on furniture imports. The importer preferred appeals and by Order-in-Appeal dated 25.09.2014 the Commissioner (Appeals) set aside the enhancement and accepted the declared value, holding that modular kitchens are not furniture and that weight-based valuation is impermissible, while the Department's separate appeal against acceptance of declared value in the remaining Bills of Entry was rejected by Order-in-Appe....
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....any written submissions filed despite notices of hearing on different dates. Since the impugned orders have been passed in favour of the Respondent-importer, we proceed to decide the appeals on the basis of the records available and the reasoning contained in the impugned orders, which effectively reflect the stand accepted by the lower authority in favour of the Respondent. Accordingly, the findings and conclusions recorded in the impugned orders are treated as representing the position of the Respondent for the purpose of adjudication of the present appeals. 5. We have carefully heard the submissions of the learned Authorised Departmental Representative, examined the appeal records in detail, and considered the statutory provisions governing valuation. 6. Upon consideration, the following issues arise for determination: - i. Whether modular kitchens in CKD/SKD condition are classifiable as furniture under Chapter 94 and whether such classification permits application of DGOV furniture guidelines for valuation. ii. Whether rejection of declared value in 11 Bills of Entry under Rule 12 and redetermination under Rule 4 was legally justified. iii. Whe....
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....ple of such unit furniture. The fact that they are assembled and fixed after import does not remove them from the ambit of Chapter 94. 7.5 We find that the reliance placed by the Commissioner (Appeals) on TELCO (supra) and SAIL (supra) is misplaced in the present context. Those decisions were rendered in the context of excise law where the issue was whether certain structures or installations embedded to earth retained the character of "goods" for the purpose of levy of excise duty. The principle applied in those cases was whether the article was movable and marketable after installation. The present case does not concern excisability or the test of marketability after erection. It concerns classification of imported goods in CKD/SKD condition at the time of import. The statutory scheme under the Customs Tariff, particularly Chapter Note 2 to Chapter 94, expressly contemplates furniture designed to be fixed to the wall. Therefore, the analogy drawn from TELCO and SAIL cannot override the clear language of Chapter 94 and the HSN Notes. 7.6 We therefore find that the conclusion of the Commissioner (Appeals) that modular kitchens are not furniture merely because they are fixed u....
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....voiced unit of transaction, but a derived figure obtained by dividing the total CIF value by total weight. 8.2 We observe that the goods involved are modular kitchen components imported in CKD/SKD condition, consisting of multiple parts such as cabinets, shutters, panels, drawers, hardware fittings and accessories, each differing in size, finish, configuration and specification. The commercial invoices, as noted in the Order-in-Original itself, were raised against specific purchase orders and reflected article-wise or unit-wise pricing for modular components. The supplier did not invoice the goods on a weight basis. We find that the adjudicating authority converted the declared per piece values into a per kilogram value by simple arithmetical division and thereafter treated variations in such derived per kilogram figures as evidence of undervaluation. The conversion of article-wise transaction value into a mathematical per kilogram figure is therefore an analytical construct of the adjudicating authority and not the declared basis of sale. 8.3 We find that Rule 4 of the Customs Valuation Rules, 2007 permits redetermination only by comparison with identical or similar goods im....