Bytesware Electronics Vs Commissioner of Customs (CESTAT Bangalore)
CESTAT find that commissioner has based his conclusions on the basis of the business model of the appellants and the description of the item in Bills of entry. Learned Commissioner finds that the nature of his business suggests that there is no structured mechanism or book keeping of records and sometimes orders are also booked on the basis of WhatsApp conversations or messages; what is however, intriguing is that the sheer spread of coverage of his customer base; while on the one hand he contends that the items he imports are meant for students and hobbyists for projects and on the other hand he also contends that there are items declared to be temperature sensors for measuring the temperature of Covid 19 patients; interestingly enough, in both these cases the supplier is the same and based in China. We are of the considered opinion that there are no fixed business models that should be followed by all. We find that the ultimate use of the imported goods cannot be criteria for deciding the valuation. Every business man is free to adopt his own way of conducting business. In any case, this cannot be reason for rejecting the value of the impugned goods. In the absence of any technical opinion obtained, comparing the impugned goods with other goods, simply on the basis of description, is not acceptable. Moreover, as per Rule 4 of CVR, 2007 the transaction value of identical goods in a sale at the same commercial level and in substantially the same quantity as the goods being valued shall be used to determine the value of imported goods. In the instant case, the comparison of the quantities, betrays a complete mismatch. Therefore, the valuation arrived on the basis of so called identical goods is not legally sustainable.
FULL TEXT OF THE CESTAT BANGALORE ORDER
The appellants, M/s Bytesware Electronics, filed Bill of Entry No 9040630 dated 03-10-2020, for import of Integrated Circuits, at a declared assessable value of Rs 29,37,162, from the overseas supplier M/s Feiland Technology Limited, Shenzhen City, Guangdong, China; it appeared to the department that the value declared by the appellants was not correct as compared to identical items imported earlier; queries were raised in the system; as the submission by the importer appeared to be without justification, it was proposed to assess the Bill of Entry in question as per Section 17(5) of the Customs Act, 1962; an opportunity of personal hearing was accorded to the appellants; order-in-Assessment dated 26-10-2020 was passed by the Assistant Commissioner of Customs, inter alia, holding that:
