Case law

Custom, Excise & Service Tax Tribunal · 21 Feb 2013

M/S Aarti Impex vs Cce, Ghaziabad

Legal principle

A declared transaction value cannot be rejected on the basis of NIDB data unless the comparable imports are matched in country of origin, time of import, quality and quantity, and absent any evidence of extra payment to the foreign supplier the invoice value must stand.

Court decision

The extract records a Final Order in the majority view setting aside the impugned order and allowing both appeals with consequential relief. The Judicial Member had allowed the appeal in full; the Technical Member would have rejected the appeal only as regards the watch batteries, and the Third Member (Sahab Singh), resolving the difference, agreed there was no infirmity in applying NIDB data to the batteries — yet the operative Final Order as recorded allows the appeal(s) and sets aside the impugned order.

Facts

M/s Aarti Impex filed a Bill of Entry dated 21.04.2011 for assorted goods — 9335 pairs ladies footwear, 1368 pairs gents footwear, 10100 dozen socks, 125933.31 dozen watch batteries and 4000 baby optical frames — declaring China as origin and an assessable value of Rs. 9,92,573/-. First-check examination revealed branded goods (Maxell/Sony batteries mostly made in Japan, Sport brand socks), missing MRPs on much of the footwear, and mis-declared origin, with declared value grossly below NIDB data. The adjudicating authority rejected the declared value under Rule 12 of the Valuation Rules 2007, re-determined it at Rs. 68,59,210/- under Rule 9 (after Rules 4 to 9 sequentially), confiscated the goods under Sections 111(d) and 111(m) with redemption fine of Rs. 13,72,000/- under Section 125, and imposed penalty of Rs. 6,86,000/- under Section 112. Commissioner (Appeals) upheld the value rejection but reduced the penalty to Rs. 3,43,000/-.

Key provisions