Case Law Details
Chakra Special Trading Co. Pvt Ltd Vs C.C. Kandla (CESTAT Ahmedabad)
It is settled law that the price of contemporeous goods cannot be applied invariably in each and every case. Before applying the enhanced comparable price varies circumtances need to be verified such as the quality of goods, quantity of goods, country of origin etc. In the present case, the revenue has neither carried out any investigation on this aspect nor brought any such data of the import related to invoice no. 4433 dated 26.04.1996 which was the sole reliance for enhancing the value. This issue has been considered by the Hon’ble Supreme Court in the case of Eicher Tractors Ltd. Vs. Commissioner of Customs, Mumbai (supra). The relevant is reproduced below:
“22. In the case before us, it is not alleged that the appellant has mis-declared the price actually paid. Nor was there a mis-description of the goods imported as was the case in Padia Sales Corporation. It is also not the respondent’s case that the particular import fell within any of the situations enumerated in Rule 4(2). No reason has been given by the Assistant Collector for rejecting the transaction value under Rule 4(1) except the price list of vendor. In doing so, the Assistant Collector not only ignored Rule 4(2) but also acted on the basis of the vendor’s price list as if a price list is invariably proof of the transaction value. This was erroneous and could not be a reason by itself to reject the transaction value. A discount is a commercially acceptable measure, which may be resorted to by a vendor for a variety of reasons including stock clearance. A price list is really no more than a general quotation. It does not preclude discounts on the listed price. In fact, a discount is calculated with reference to the price list. Admittedly in this case discount up to 30% was allowable in ordinary circumstances by the Indian agent itself. There was the additional factor that the stock in question was old and it was a one time sale of 5 year old stock. When a discount is permissible commercially, and there is nothing to show that the same would not have been offered to any one else wishing to buy the old stock, there is no reason why the declared value in question was not accepted under Rule 4(1).”
Further as discussed in the case of Commissioner of Customs, Calcutta Vs. South India Television (P) Ltd. (supra) we find that onus is on the department to prove undervaluation of goods, which has not been discharged by the department. We, therefore hold that value of goods cannot be enhanced and value declared by the appellant at USD 110 PMT is to be accepted.
Appellant not liable to pay interest for the period prior to passing of assessment order on Customs Duty Demand
Please become a Premium member. If you are already a Premium member, login here to access the full content.
