The CESTAT New Delhi held that Emails and other electronic evidence cannot be relied upon to prove undervaluation. The charge of undervaluation cannot be made out on mere assumptions and presumptions.
The ruling was made by a division bench comprising of members Judicial Member Anil Choudhary and Technical Member Bijay Kumar in the case of H S Chadha Vs. Commissioner of Customs (Preventive).The appellant M/s Vortex Rubber Industries Pvt Ltd filed Bill of Entry No. 6224101 dated 24.07.2014 for clearance of Tyres and Tubes. However, the consignment was examined by Customs Preventive and the goods were seized under Section 110 of the Customs Act, 1962. The Department also alleged undervaluation and misdeclaration in the previous imports of the appellant. The investigation regarding undervaluation of appellant M/s Indo Silicon Electronics Pvt Ltd was also done since this Company also had the same Director Shri H S Chadha which also imported tires and tubes. Accordingly, on the allegation of undervaluation, Show Cause Notice was issued to appellants.
The appellants state that the impugned order has been passed in a mechanical manner without appreciating that the prices as reflected in the emails are only quotations and not the final price and thus cannot be relied on for value enhancement of the goods
The tribunal found that there is no mention regarding which rule of the Customs Valuation Rules 2007 has been applied to arrive at the re-determined value and there is also no sequential application of Rules. Emails and other electronic evidence cannot be relied upon to prove undervaluation. The charge of undervaluation cannot be made out on mere assumptions and presumptions. It held that for the appellants M/s Vortex Rubber Industries Pvt Ltd, and M/s Indo Silicon Electronics Pvt Ltd confiscation of goods, denial of SAD exemption, the demand of differential duty, interest and penalty cannot be sustained on the appellant-Company and appellant Director Shri H S Chadha. Resultantly, the impugned order against appellants is set aside. The appeals are allowed with consequential benefits and any amount appropriated by the impugned orders stands revoked.Subscribe Taxscan AdFree to view the Judgment