2024-VIL-826-CESTAT-MUM-CU
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CUSTOMS CESTAT Cases

Customs – Section 14 of Customs Act, 1962 – Rules 3, 6 and 8 of Customs Valuation (Determination of Price of Imported goods) Rules, 1988 – Import of scrap – Allegation of undervaluation – Rejection of declared value – Demand of differential duty – Appellant imported Aluminium scrap and Zinc scrap of various grades – Directorate of Revenue Intelligence received intelligence that Appellant was indulging in undervaluation of imported goods with intent to evade payment of customs duty – On conclusion of investigation, Commissioner rejected declared value of goods and re-determined same under Section 14 of the Act read with Rules 3, 6 and 8 of the Rules and confirmed demand of differential Customs Duty – Whether impugned order rejecting declared value and re-determining value of imported scrap items is sustainable – HELD – Appellant had entered into contract with overseas suppliers for importation of scrap items in question – Pursuant to contractual norms, goods were supplied by overseas entities under cover of commercial invoices bearing reference of description of goods, quantity, price etc. – There is no evidence to show that Appellant had paid any amount over and above invoice price to foreign suppliers – Department has not placed on record any credible evidence, for rejection of declared transaction value – Adjudicating authority has proceeded to re-determine value of imported scrap on basis of Circular No.14/2005 issued by Director General of Valuation (DGOV) without considering and overlooking contemporaneous data available before him on record – If value of contemporaneous imports are available, same shall be the basis for re-determination of value – Price declared by Appellant should be considered as the transaction value for purpose of payment of customs duty, inasmuch as, imports made by those contemporaneous importers are at same commercial level at which Appellant had imported impugned goods – Impugned order re-determining value of imported scrap on basis of DGOV Circular cannot be upheld and value declared by Appellant cannot be rejected – Adjudged demands confirmed against Appellant are not sustainable – Impugned order passed by Commissioner set aside – Appeals allowed
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