TaxTMI 
TaxTMI 
2026 (3) TMI 1468
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....r challenge the Ld. Commissioner has directed the re-assessment of the imported goods by inclusion of an amount equivalent to 20% of the FOB value of the goods in terms of erstwhile Rule 10(2) of the Valuation Rules1 and inclusion of 1.125% in terms of proviso (3) to Rule 10(2) towards insurance charge. Accordingly, the Ld. Adjudicating authority has confirmed the demand for an amount of Rs.1,08,49,409/- along with interest as leviable in terms of Section 28AA. He has also imposed a penalty of equal amount on the appellant under Section 114A of the Customs Act. 4. Vide the show cause notice dated 07.06.2022, issued in the matter, it is alleged that the importer-appellant during the period July 2017 to April 2018 resorted to short payment of IGST on account of non-inclusion of freight charges and the insurance amount in the assessable value. The department has therefore charged that the assessable value was deliberately mis-declared by the appellant and the appellant had contravened the provisions of Section 14(1) of the Customs Act, 1962 read with Rule 10(2) of the Valuation Rules 2007 [The Valuation Rules]. The Revenue have inter alia also alleged violation of Section 12 and Se....
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.....2017 the appellants were however including 1% of the declared FOB value towards landing charges and did not do so subsequently because of the amendment carried out to the legal provisions for discontinuation of any addition of amount towards landing charges thereafter. 7. The Ld.AR for the Revenue has pointed out that the inclusion of freight and insurance to the FOB value is legally mandated in terms of the provisions of section 14 Customs Act read with Rule 10(2) of the Valuation Rules1 and that an addition of 20% of the FOB towards freight cost (as prescribed in law) was not done. The same way it was required that the declared value be added, by way of insurance charge, an amount @ 1.125% of FOB to arrive at the assessable value. He therefore supports the adjudication order of the Ld. Commissioner passed in response to the show cause notice dated 07.06.2022, demanding differential duty along with interest and proposing imposition of penalty under section 114A of the Customs Act. 8. The Ld. Counsel for the appellant, to the Revenue's plea that place of loading of the imported goods was nearly 18-20 kms. inside the LCS location in Bhutan and therefore freight was required t....
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....Counsel has further assailed the show cause notice being issued, invoking extended period of limitation stating that no charge of suppression can be made out against them as they had clearly stated that the value of the goods declared to be FOB as evident from the invoice cum challan that was tendered at the time of assessment and hence the charge of suppression cannot be made out against them in the matter. He also points out that in addition, the subject matter being revenue neutral, no loss is either caused to the Revenue nor can any intendment be attributed to the appellant towards evasion of duty in the matter. He has finally submitted that at best this can be considered as a case of interpretation of the valuation aspect and therefore, subjecting the appellant to imposition of penalty is also grossly irregular and unfounded. The Ld. Counsel therefore prayed for setting aside the order both on merits as well as on limitation. 10. We have considered the rival submissions of the two sides and perused the case records. 11. On the merits of the matter, the appellant has pointed that in the present case the FOB and the CIF value is one and the same and therefore there is no l....
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.... required to be demonstrated concisely by producing cogent documentary evidence. The NIL cost of transportation as contended by the appellant therefore under the circumstances at best can be considered as a ploy, to escape the clutches of law and to circumvent the aspect of transportation cost as being NIL and therefore not "not ascertainable". We also note that some of invoice-cum-challan Delivery Order Date 28.10.2017, Order Date 28.09.2017 enclosed to the appeal papers have the following "Terms & Conditions", printed therein : "1. ALL GOODS ARE DESPATCHED AT BUYERS RISK. 2. OUR REPONSIBILITY CEASES WHEN THE TRUCK LEAVES OUR FACTORY PREMISES. 3. ANY DISPUTES AGAINST THIS TRANSACTION WILL BE SUBJECT TO THE JURISDICTION OF COURTS IN THE KINGDOM OF BHUTAN. These endorsements are sufficient enough to find substance in the Revenue's claim that the goods have been consigned ex works and the cost of transportation (at least within Bhutan, as also between Bhutan and India in the absence to show anything to the contrary) as well as insurance is required to be added as per law to the declared cost. For the very reasons the inclusion of both 20% and 1.125% of t....
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....t of limitation has sought recourse to suppression. This suppression or willful intent to evade cannot be made out as the appellant had categorically stated the facts in the invoice cum challan furnished and based on their understanding had apparently termed the same as "CF", in the Bill of Entry. Given the categoric assertion in the invoice cum challan, the Bill of Entry declaration cannot be considered a case of willful misstatement. We do not find that the Revenue has under the circumstances categorically discharged its onus to prove malafides on the part of the appellant importer. Were the variation in language between the invoice cum challan and the Bill of Entry were to be considered by way of lack of appropriate understanding of the concepts of the importer, we may point out that it is the responsibility of the authorities to appropriately assess the Bill of Entry. Having not done so at the initial stage, no decoy case of suppression/misstatement can be made out at a subsequent stage. The onus is on the Revenue to show suppression/misstatement by way of a positive lead. A conscious deliberate withholding/misstatement is required to be shown in order to invoke the larger peri....
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.... to succeed on grounds of limitation. We therefore set aside the order of the lower authority and allow the appeal filed. (Order pronounced in the open court on 25 March 2026.) ============= Document 1 http:/ddvplcap03.cbec.gov.in:7776/imphtm/lbe6 ... (For Internal Use Only) Indian Customs EDI System - Imports V1.5R001 L'CS JAIGAON, ALIPURDUAR DIST, WEST BENGAL. BILL OF ENTRY FOR HOME CONSUMPTION. [Custom Sto: INJIGB] de No/Dt./cc/Typ:6033521/18/04/2018/N/H 00℃ No./Dt/Officer:2827875818/19-04-2018/10042893 Importer Details :0695003020 PAN : AAACR6582KFT001 RIMJHIM, ISPAT LTD. 1 ;8-20/1,22-25, UPSIDC IND.AREA, BHARWA !- AD Code : 0300090 CHA : AIKPM5609DCH001 [DEHAG OVERSEAS 1 SUMERPUR HAMIRPUR .U.P. 210502 IGN No: : 275267/18/04/2018 18/04/2018 Port Of Loading. : Phuntsholing Payment Method : Transaction Entry Of Orgn .: BHUTAN BL. No INV201800423 Chtry Of Conson .: Date : 12/04/2018 H/BL. No No. of Pkgs, : 725 BGS Date Marks:API Gross' Wt. & Nas 29218.000 KGS Inv No & Dt. : INV201800423 12/04/2018 BHUTAN FERRO ALLOYS LTD PHUENTSHOLING BHUTAN Inv: Val 2784000.00 INR TOI: CF Freight Ins....