The Mumbai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) remanded matter for determining value verification of prices of actually sold goods not possible in absence of evidence.
The appellant, M/s SR Traders, in connection with import of ‘cosmetics’, branded as ‘TYA’, against bill of entry no. 9813519/24.05.17 that, though found to be in conformity as far as description and quantity were concerned, was allegedly undervalued and non-compliant with Legal Metrology (Packaged Commodities) Rules, 2011 as well as Drugs and Cosmetics Act, 1940 leading to investigations culminating in impugned order of Commissioner of Customs rejecting the value of ₹ 25,78,752 declared therein pertaining to past imports, under rule 12 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.
Assessable value was enhanced to ₹ 1,51,64,962 and ₹ 3,09,75,414 respectively by recourse to rule 9, read with rule 7, of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 for levy of ₹ 47,14,662 as duty short-paid while ordering recovery of ₹ 94,21,833 on the past imports under section 2 of Customs Act, 1962, along with applicable interest under section 28AA of Customs Act, 1962, as well as penalty of like amount under section 114A of Customs Act, 1962 even as the live consignment, upon confiscation under section 111(m) of Customs Act, 1962, was permitted to be redeemed under section 125 of Customs Act, 1962 on payment of fine of ₹ 15,00,000.
It was argued that market inquiry was conducted behind the back of the importer and that the impugned computation lacked support of any documentation on the veracity of the prices adopted.
that the goods are branded and it should be reasonable to presume that such branded goods are sold in the market; no other logical purpose occurs to us for import as such.
It should have been apparent to the adjudicating authority that the appellant could have been asked to disclose the channel of distribution and for the retail prices to be ascertained thereby. Thence to proceed to deductive value should not have been impossible.
A two member bench comprising Mr C J Mathew, Member (Technical) and Ajay Sharma, Member (Judicial) observed that “even though the asseese contended that values of earlier imports are clearly ascertainable, no details were furnished to the adjudicating authority or now before us. It would only be appropriate for such evidence to be furnished and for the adjudicating authority to cause verification of prices at which these were actually sold.”
The CESTAT set aside the impugned order and direct fresh adjudication in the light of submissions made on behalf of appellant before us. The matter is remanded to the original authority for re- determination on the facts pertaining to earlier imports to be furnished by the appellant.
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