Case law

Custom, Excise & Service Tax Tribunal · 27 Mar 2012

) M/S. S.S. Impex vs Commr. Of Customs (Port), Kolkata

Legal principle

Casting suspicion on the invoice produced by the importer is not sufficient to reject it as evidence of value; undervaluation must be proved by cogent evidence or comparable imports, and goods once held to be what was declared cannot be valued as different goods.

Court decision

The Tribunal held that the Commissioner's order on valuation was not sustainable in law, set aside the order, allowed the appeals of the importer and other noticees to that extent (the valuation finding), dismissed the appeal of Revenue, and disposed of the stay petitions, clarifying the order would not interfere in any other proceeding on the import or the value enhancement.

Facts

M/s. S.S. Impex, through CHA M/s. Gee Pee International, filed Bill of Entry No. 422853 dated 29/07/2008 for 540 bales of old and used garments (CTH 6309) imported from M/s. American Used Cloth Inc., declaring USD 0.45 per kg, which Customs assessed at USD 0.60 per kg; the goods were warehoused under Section 49. DRI re-examination found code words on bales identifying specific articles, most showing no appreciable wear, suggesting mis-declaration rather than worn clothing, and statements under Section 108 were recorded from the importer, the CHA's partner and a wholesale buyer (M/s. Ma Vabatarini Enterprises) whose purchase prices were treated as wholesale market prices. The Commissioner by order KOL/CUS/PORT/07/2010 dated 25.2.2010 ordered confiscation, allowed redemption on a fine of Rs. 4,25,000/-, and imposed penalties under Section 112(a) and 112(b) on the importer (Rs. 1,70,000/-), the CHA (Rs. 15,000/-) and its partners Prabhat Manna and Gautam Adhikary (Rs. 25,000/- each), while dropping proceedings against certain Customs officers, leading to cross-appeals including by Revenue.

Key provisions