2019 (1) TMI 81 - AT - Customs

Valuation - rejection of declared value - Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 - scope of SCN - case of appellant is that ideally the Customs should have adopted the Customs Valuation Rules sequentially and in that respect, the impugned order as well as Order-in-Original are beyond the scope of Show Cause Notice - Held that - It is not in dispute that the goods imported by M/s Vimal Intertrade Pvt. Ltd. are part of the same original consignment and therefore identical in all physical specifications and in terms of country of origin to the goods imported by the appellant. Ld. Counsel has sought to argue that the imports made by the appellant are at a different commercial level. However, we notice that the quantities imported by the appellant and by M/s Vimal Intertrade Pvt. Ltd. are practically similar and in the some cases, the quantity imported by M/s. Vimal Intertrade Pvt. Ltd is higher than the quantity imported by the appellant. It is seen that the Show cause notice invoked Rule 5 of the Customs Valuation Rules 2007 whereas the impugned order invoked Rule 3(1) read with Rule 10 (1)(d) of the Customs Valuations Rules 2007. It is apparent that the impugned order has gone beyond the scope of Show Cause Notice. The impugned order is set aside and matter is remanded to Adjudicating Authority for fresh adjudication keeping in mind the charges made in the Show Cause Notice - Appeal allowed by way of remand.

Issues Involved:
- Customs duty demand, interest, and penalty on imported Polypropylene Glycol
- Invocation of Customs Valuation Rules 2007
- Discrepancy in assessable value declared by the appellant and M/s Vimal Intertrade Pvt. Ltd.
- Application of SVB order
- Compliance with Show Cause Notice

Analysis:

Customs Duty Demand:
The appeal was filed against the demand of Customs duty, interest, and penalty on imported Polypropylene Glycol. The appellant imported the goods from a related supplier and sold part of the consignment to M/s Vimal Intertrade Pvt. Ltd. The dispute arose regarding the assessable value declared by the appellant compared to the value declared by M/s Vimal Intertrade Pvt. Ltd.

Invocation of Customs Valuation Rules 2007:
The Customs invoked Rule 12 and Rule 5 of the Customs Valuation Rules 2007 to determine the assessable value. However, the Order-in-Original and the impugned order went beyond the scope of the Show Cause Notice by invoking Rule 11 and Rule 3(1) read with Rule 10(1)(d) of the Customs Valuation Rules 2007. The discrepancy in the application of these rules led to the appeal being allowed for remand.

Discrepancy in Assessable Value:
The Revenue sought to adopt the assessable value declared by M/s Vimal Intertrade Pvt. Ltd., which was higher than the value declared by the appellant. Despite arguments that the transaction value should be accepted, the Tribunal noted that the goods were practically similar, and the quantities imported were comparable, leading to a reevaluation of the assessable value determination.

Application of SVB Order:
The appellant relied on a previous SVB order indicating that the transaction between them and their supplier was not influenced by their relationship. However, the Revenue argued that the SVB order could not be applied in this case due to the presence of contemporary imports at higher prices, which impacted the valuation.

Compliance with Show Cause Notice:
The Tribunal found that the impugned order and the Order-in-Original exceeded the scope of the Show Cause Notice in determining the assessable value. As a result, the matter was remanded to the Adjudicating Authority for fresh adjudication in line with the charges outlined in the Show Cause Notice, ultimately allowing the appeal by way of remand.

This detailed analysis of the judgment highlights the key issues involved, the arguments presented by both parties, and the Tribunal's decision to remand the case for a fresh adjudication in compliance with the Show Cause Notice.

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