Mahindra Aerostructures Pvt. Ltd. Vs Commissioner of Customs (CESTAT Chennai)
These appeals arose from a common Order-in-Original dated 30.12.2014 passed by the Commissioner of Customs, Chennai-IV. The appellant imported old and used machinery through Chennai Port under the concessional EPCG Scheme on a high seas sale basis. The machinery had originally been supplied by Boeing Aerostructures Australia and transferred to a group company before being imported. Following investigation by the Directorate of Revenue Intelligence (DRI), the Department alleged suppression of the actual value and charges relating to the imported machinery. The adjudicating authority rejected the declared assessable value under Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, re-determined the assessable value, denied EPCG notification benefit, demanded differential duty with interest, imposed penalties on the importer under Sections 114A and 114AA of the Customs Act, 1962, and imposed penalties on the company’s DGM under Sections 112(a) and 114AA.
The appellant raised several issues, including whether the value determined under Rule 9 based on the Chartered Engineer’s appraisal could be rejected under Rule 12, whether the insured value represented the actual value of the machinery, whether documents had been manipulated, whether the extended limitation under Section 28(4) could be invoked in a “first check” assessment, and whether EPCG benefits could be denied without cancellation of the licence by the Director General of Foreign Trade (DGFT). The Revenue contended that investigations had revealed manipulation of inspection reports, suppression of payments relating to dismantling, storage, insurance, transportation and other costs, and inconsistencies in the documents and statements recorded under Section 108 of the Customs Act.
