The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal(CESTAT) upheld the order dropping the proceeding against the import of poppy seed. The show cause notice (SCN) was issued demanding customs duty cannot be issued without investigating facts of mismatch in declared value.
M/s. Sawetri Trading Company, the respondents imported ‘Poppy Seeds’. After an investigation, a show cause notice was issued to the respondents to demand differential duty of customs alleging that the supplier of ‘Poppy Seeds’ is the same from Turkey whereas the declared price shown by the respondent is much less than the ‘Poppy Seeds’ imported by the other importers.
The Commissioner(Appeals) relying on the Tribunal’s decision dropped the proceedings against the respondents. The Tribunal in the case of Ajay Exports and further in the case of Chirag International v. Commissioner of Customs observed that “We find that from the SCN it can be seen that the reason for issuance of the SCN is basically an alert from the DG Valuation. In our view, merely by an alert of DG valuation, SCN cannot be issued in mass to all the importers without investigating the fact of their declared value. Though in the subsequent inquiry, the department has found that as per the public ledger international price published therein is 3200 PMT FOB Turkey however as per the judgment of this Tribunal in the case of Ajay Exports (supra), the Tribunal has categorically held in the identical case that merely on the basis of international price published in the public ledge cannot be used for enhancement of the value.”
“Only a price which declared by the assessee and accepted by the department, the bill of entry thereof can only be taken as the price of contemporaneous goods. Moreover, the enhancement of the price in the case of Laxmi Trading Co., the case was before the Tribunal and the enhancement was set aside by the Tribunal in the case of Ajay Exports and others including the Laxmi Trading Co. (supra) therefore on both the count i.e. either the international price published in the public ledge or contemporaneous price of Laxmi Trading Co., the enhancement is incorrect and illegal. As regards the judgements relied upon by the Ld.AR, we find that the absolutely identical facts and law point in respect of the same case from the same country of origin has been decided by this Tribunal in the case of Ajay Exports and others, therefore, the facts of those cases relied upon by the AR is different from the case in hand, therefore, the judgments are not applicable. As per our above discussion, the enhancement of the price and consequential demand, interest etc. are not sustainable. Accordingly, the impugned order is set aside and appeal is allowed with consequential relief.”
In view of the judgement, the two-member bench comprising Shri Ashok Jindal, Member(Judicial) and Shri Rajeev Tandon, Member(Technical) upheld the impugned order and dismissed the appeal of the revenue.
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