Modak Dyeing & Printing Co. Pvt. Ltd. Vs Commissioner of Customs (CESTAT Delhi)
Held that if the transaction value (FOB value) is so high, that the drawback due on the goods exceeds the market value of the goods, then, as per section 76(1) (b) of the Customs Act, no drawback shall be allowed.
Facts- The appellant filed two shipping bills dated 31.08.2018 for export of Girls Frocks Woven Made of Manmade Fibre. The appellant declared total FOB value of Rs. 4,10,52,321/- in the shipping bills which worked out to about Rs. 274.13 per piece. Receiving intelligence these goods were overvalued in order to claim excess benefits of drawback, Refund Of State Levies (ROSL), Merchandise Exports from India Scheme (MEIS) & IGST refund, the Special Intelligence and Investigation Branch of the Commissionerate (SIIB) examined the goods under a panchnama.
A show cause notice dated 14.11.2019 was issued to the appellant proposing to reject the FOB value declared by the appellant in the two shipping bills under Rule 8 of the Customs Valuation (Determination of Value of Export Goods) Rules, 2007 and re-determine it at Rs. 45,00,000/- and Rs. 29,88,000/- re-determine under Rule 6 of the Valuation Rules. It was also proposed to confiscate the export goods u/s. 113 (i) of the Customs Act, 1962 and imposed penalties u/s. 114 (iii) and 114AA of the Act.
