TaxTMI 
TaxTMI 
2026 (3) TMI 448
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....s import data from same supplier under Rule 5 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 [herein after referred to as "CVR", for short]; confiscation of goods under Section 111(m) of the Customs Act, 1962; imposition of redemption fine and penalty on the appellants under Sections 125(1) and 112(a) ibid, respectively; and upholding confirmation of the adjudged demands by the first appellate authority. Brief facts of the case, leading to this appeal, are summarized herein below: 2.2 The appellant had filed Bill of Entry (B/E) No. 7318932 dated 30.10.2014 and B/E No. 7250469 dated 03.11.2014 with Air Cargo Customs Commissionerate, Sahar, for clearance of total 28,600 nos. of "Power Bank 5200mAH" having part number VXN4062IN, which were imported from Singapore and supplied by M/s Xiaomi Singapore PTE Limited, Singapore. In the said B/Es, the unit value of the impugned goods was declared by the appellants at US $ 3.64. The said imported goods were subjected to physical examination on first check appraisement basis, with specific examination directions given by the proper officer of Customs Appraising group. Upon examination of the imported goods, the ....
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....s of impugned goods; the rest of 1,71,400 units of same goods, had also been imported at the very same value during 23.09.2014 to 02.05.2015, in several imports; and these have also been cleared by the same Customs Commissionerate, without any dispute on the basis of declared value. The entire consignments were imported by the appellants pursuant to a 'Supply Agreement' dated 25.07.2014 entered with the Foreign supplier, which inter alia covers agreement to import several electronic items against purchase orders issued by the appellants from time to time. Therefore, he pleaded that they had properly declared the assessable value and the customs authorities should have accepted the transaction value under Rule 3 of CVR. In support of the same, he provided the details of their total imports as follows: Purchase Order No. and date Proforma Invoice and date Quantity with unit price Total amount paid by the appellants FINVDW529608 dated 16.09.2014 IN-2002 dated 16.09.2014 1,50,000 Rs.220/- Rs. 3,30,00,000/- FINVMB529609 dated 16.09.2014 IN-2001 dated 16.09.2014 50,000 Rs.220/- Rs. 1,10,00,000/- 3.2 Learned Advocate further stated that even if the v....
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....y Hon'ble Supreme Court - 2008 (228) E.L.T. A29 (S.C.) (ii) Saro Electro Equipments Pvt. Ltd. Vs. Commissioner of Customs (Import), ACC, Mumbai - 2018 (360) E.L.T. A192 (Tri. Bom.) upheld by Hon'ble Supreme Court - 2020 (371) E.L.T. A249 (S.C.) (iii) Agarwal Foundries (P) Ltd. Vs. Commissioner of Customs - 2020 (371) E.L.T. 859 (Tri. - Hyd.) upheld by Hon'ble Supreme Court - 2020 (371) E.L.T. A295 (S.C.) (iv) Impex Steel & Bearing Co. Vs. Commissioner of Customs, Delhi-IV - 2014 (302) E.L.T. 464 (Tri. - Del.) (v) Commissioner of Customs, Calcutta Vs. South India Television (P) Ltd. - 2007 (214) E.L.T. 3 (S.C.) (vi) Radhey Shyam Ratanlal & Anr. Vs. Commissioner of Customs, (Adjudication), Mumbai - 2009 (238) E.L.T. 14 (S.C.) 4. Learned Authorized Representative appearing for the Revenue reiterated the findings recorded by the lower authorities and justified the impugned order, on the ground that contemporaneous value of similar goods have been adopted and in view of the mis-declaration, consequential fine and penalty has been imposed. Therefore, he stated that the appeal filed by appellants-importer may not be entertained. 5. We hav....
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....he price actually paid or payable where the buyer and seller are not related and the price is the sole consideration: SECTION 14. Valuation of goods. (1) For the purposes of the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force, the value of the imported goods and export goods shall be the transaction value of such goods, that is to say. the price actually paid or payable for the goods when sold for export to India for delivery at the time and place of importation, or the cate may be, for export from India for delivery at the time and place of exportation, where the buyer and seller of the goods are not related and price is the sole consideration for the sale subject to such other conditions as may be specified in the rules made in this behalf Further, Rule 12 of Customs Valuation Rules, 2007 provides that if the proper Officer has reasons to doubt the truth and accuracy of the declared value, he may reject it. 6. In the case at hand, the documents submitted by the appellant before the Assessing Officer revealed that the price declared in the invoice was in CIF terms which included cost of the goods along with freight fro....
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....of Power bank (5200 mAH) at the price of Rs. 222 per piece whereas 10000 pcs of same goods were imported by M/s Betel Teletech Lul from the same supplier at Rs. 454 per piece which could not be justified. Under the circumstances I am of the considered view that the adjudicating authority had rightly rejected the declared value. I also find that the case laws cited by the appellant are distinguishable in the facts and circumstances of the case at hand. 8. As far as the redetermination of value is concerned I find that the adjudicating authority has observed that the prices of identical goods were ranging from Rs. 347.51/- to Rs.513.55/- per piece during the relevant period. I find that the adjudicating authority has adopted price of Rs.454.50/- per piece on the basis of goods imported by M/s. Beetel Teletech Ltd. vide B/E. No. 7776209 dated 12.12.2014 under rule 5 of CVR 2007 which was comparable in nature. I do not find any infirmity in redetermination of value under Section 14 read with rule 5 of Customs valuation rules 2007 for the purpose of charging Customs duty. 9. In view of the above, I do not find any reason to interfere with the impugned order and the ord....
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....have not been captured in the transaction value, in which case, the value for imposition of duty must be determined under one of the subsequent methods of valuation applied in sequential order from Rule 4 to Rule 9 ibid. Further, from perusal of aforesaid basis of determining the value based on the price of similar goods imported by M/s Beetel Teletech Limited at Rs. 454.50/- per unit, from same supplier, it is clear that the value of 'identical goods' was either not available in the NIDB data base or it has not been considered and therefore the authorities have adopted the value of 'similar goods'. However, on perusal of the documents placed on record viz., supply agreement between the appellants and foreign supplier Xiaomi Singapore PTE Ltd. that the arrangement is at the wholesale level, where the appellants are operating at B2B E-commerce level, and the prices are fixed as per territory pricing schedule, for a number of products with large quantity, and hence the price for sale/supply of 28,600 nos. of impugned goods under dispute, can very well could have been determined on the basis of price of 'identical goods' sold/supplied for rest of 1,71,400 nos. of impugned goods during....
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....ted in the present case and remaining 1,71,400 is undisputed cleared at transaction value) 10,000 units Method of business Ultimate sale is to e-commerce retailers Sale is to End customers 7.2 From the careful perusal of the orders passed by the authorities below, viz., the order of the original authority, which was upheld by the learned Commissioner (Appeals) in the impugned order, as detailed at paragraph 6.2 above, it clearly transpires that the requirements of Rule 3 and following sequentially Rule 4 to Rule 9 of CVR, 2007 have not been followed, as it was found by them that the National Import Data Base (NIDB) data does not have such prices of identical or similar goods. Further, the authorities below had re-determined the assessable value solely on the basis of single transaction of import of 10,000 pieces, ignoring other 1,71,400 pieces imported, without applying the legal provisions of various rules provided under the CVR, 2007, sequentially. Therefore, the whole process of arriving at the re-determined value on the basis of NIDB data regarding the price of similar goods, and based on such value, the assessable value of the impugned goods having been re-deter....
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....n has been shown to have actually taken place. In the case of Eicher Tractors Ltd. v. CC, Mumbai [2000 (122) E.L.T. 321 (S.C.), Adani Exports Ltd. v. CC, Visakhapatnam [2000 (116) EL.T. 715] and Karan Vir Mehta [1998 (97) E.L.T. 42 (Ker.)], it has been laid down that the quotation/Proforma invoice being a tentative statement of the seller for sale of goods at the price mentioned therein, is not relevant evidence of sale price in the absence of actual import in pursuance of such a quotation. In the case of Eicher Tractors Ltd. cited supra, the Apex Court has clearly laid down the principles and the situation where the transaction value can be doubted by the Revenue. In the present case, the Revenue has not produced/brought on record any evidence to discard the value declared by the importers. On the other hand, the importers have produced the certificate issued by the foreign supplier certifying that the value declared to Taiwan Customs was also US$ 3,55,000 which has been wrongly rejected by the Commissioner on the ground that it has not been authenticated by the Indian Embassy. There is no evidence of any contemporaneous import of identical or similar goods at the price adopted by....
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....order is quoted below: "2. The appellant imported pig iron from various overseas traders for use in manufacture of billets. The declared value of pig iron varied from USD 229 per MT to USD 300 per MT. These values were rejected by the assessing officer who enhanced the value to USD 500 per MT based on the data available with the NIDB. NIDB is the data of the Customs Department which gives values of various commodities based on various transaction values of different goods. The question which falls for consideration is whether the invoice value can be rejected and the duty can be charged as per NIDB data without any specific evidence that the invoice values do not reflect actual transaction value. This issue was decided in respect of the same assessee vide Final Order No. A/3014330156/2018, dated 29-1-2018. It has been held that the NIDB data can be a guideline for the customs to arrive at the value of the goods but the NIDB data cannot be applied directly unless the value given therein falls within the parameters of identical goods or similar goods. Relying on the decisions in the cases of Topsia Estates Pvt Ltd v. CC (Import Seaport) Chennai [2015 (330) E.L.T. 799 (Tri. -....
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....t to the provisions of sub-section (1), the price referred to in that sub-section in respect of imported goods shall be determined in accordance with the rules made in this behalf." 5. We also quote herein below Rule 4 of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988, as it stood at the relevant time : "4. Transaction value. - (1) The transaction value of imported goods shall be the price actually paid or payable for the goods when sold for export to India, adjusted in accordance with the provisions of Rule 9 of these rules. (2) The transaction value of imported goods under sub-rule (1) above shall be accepted : Provided that - (a) there are no restrictions as to the disposition or use of the goods by the buyer other than restrictions which - (i) are imposed or required by law or by the public authorities in India; or (ii) limit the geographical area in which the goods may be resold; or (iii) do not substantially affect the value of the goods; (b) the sale or price is not subject to same condition or consideration for which a value cannot be determined in respect of the g....
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....egation of mis-declaration in the context of the description of the goods. In the present case, the allegation is of under-invoicing. The charge of under-invoicing has to be supported by evidence of prices of contemporaneous imports of like goods. It is for the Department to prove that the apparent is not the real. Under Section 2(41) of the Customs Act, the word "value" is defined in relation to any goods to mean the value determined in accordance with the provisions of Section 14(1). The value to be declared in the Bill of Entry is the value referred to above and not merely the invoice price. On a plain reading of Section 14(1) and Section 14(1A), it envisages that the value of any goods chargeable to ad valorem duty has to be deemed price as referred to in Section 14(1). Therefore, determination of such price has to be in accordance with the relevant rules and subject to the provisions of Section 14(1). It is made clear that Section 14(1) and Section 14(1A) are not mutually exclusive. Therefore, the transaction value under Rule 4 must be the price paid or payable on such goods at the time and place of importation in the course of international trade. Section 14 is the deeming pr....
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.... 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. Section 14(1) speaks of "deemed value". Therefore, invoice price can be disputed. However, it is for the Department to prove that the invoice price is incorrect. When there is no evidence of contemporaneous imports at a higher price, the invoice price is liable to be accepted. The value in the export declaration may be relied upon for ascertainment of the assessable value under the Customs Valuation Rules and not for determining the price at which goods are ordinarily sold at the time and place of importation. This is where the conceptual difference between value and price comes into discussion. 7. Applying the above tests to the facts of the present case, we find that there is no evidence from the side of the Department showing contemporaneous imports at higher price. On the contrary, the respondent importer has relied upon contemporaneous imports from the same supplier, namely, M/s. Pearl Industrial Company, Hong Kong, which indicates comparab....
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....served that Rule 4(1) of the Customs Valuation Rules refers to the transaction value. Utilization of the word 'the' as definite article indicated that what should be accepted as the transaction value for the purpose of assessment under the Customs Act is the price actually paid by the importer for the particular transaction, unless it is unacceptable for the reasons set out in Rule 4(2). In the said judgment, it has been further held that, the word 'payable' in Rule 4(1) also refers to the "transaction value" and payability in respect of the transaction envisaged a situation where payment of price stood deferred. Therefore, this decision of the Supreme Court directs the Revenue to decide the validity of the particular value instead of rejecting the transaction value. We wish, however, to clarify that it is still open to the Department based on evidence, to show that the declared price is not the price at which like goods are sold or offered for sale ordinarily, which words occur in Section 14(1). Lastly, it is important to note that in the above decision of this Court in Eicher Tractors (supra) this Court has held that the Department has to proceed sequentially under Rules 5, 6 onw....