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2022 (6) TMI 626 - AT - CustomsImport of TV in CKD (unassembled) in parts - rejection of declared value - classification of branded assemblies - Recovery of Customs Duty - recovery under section 18 of Customs Act, 1962 or under section 28 of Customs Act, 1962 along with interest as applicable under setion 28AB of Customs Act, 1962? - enhancement of the assessable value solely on the ground that the imported goods aggregate as the finished goods and by adjusting the list price of the manufacturers of these goods at Singapore - confiscation - penalties - HELD THAT:- The impugned order has discarded the declared value for being associated with description of goods that did not find merit with the adjudicating authority; there is no allegation that the ‘parts’, of themselves, were undervalued. It is the finding that ‘parts’ declared in the relevant bills of entry, taken together, are, in reality, branded assemblies classifiable against a tariff item in the First Schedule to Customs Tariff Act, 1975 other than that sought for in the relevant bills of entry that has prompted the finding of irreconcilability with invoice and, therefore, have the value therein rejected for assessment. There is, however, no finding that, physically and as presented, the goods are not ‘parts’ even if they add up to finished goods upon assembly. The determination of the price itself is fraught with contradictions and presumptions. The adjudicating authority has relied upon appraisal of an interested party, viz., the domestic entities dealing with the brands that, allegedly, had been procured by the importers at Singapore - The computation, under the authority of ‘best judgement’ in the impugned order, does not bear any resemblance to the framework within which such valuation should be re-determined. Consequently, the revised valuation is set aside. The critical aspect for ‘clubbing’ rests entirely upon the establishment of fraud and deliberate subterfuge for, admittedly, nefarious purpose; the inculpatory statements of the parties to those transaction was found to suffice for holding that the decision of the Tribunal setting aside the ‘clubbing’ had erred in placing reliance on an earlier decision of the Tribunal which, while finding affirmation by the Hon’ble Supreme Court by distinguishment from the judgement in COMMISSIONER OF CUSTOMS, NEW DELHI VERSUS PHOENIX INTERNATIONAL LTD. [2007 (9) TMI 275 - SUPREME COURT], did not apply to the facts of the dispute. Such evidence is sorely lacking in the records before us and the finding of the adjudicatory authority is a summation of several disjointed facts culminating in conjecture. None of the cited decisions permit detriment on the basis of such foray. In re Phoenix International Ltd, the subterfuge adopted to bypass the prohibition, vide paragraph 156 (A) of the EXIM Policy 1992-97 placing consumer goods in the negative list, was brought on record for setting aside the order of the Tribunal disapproving the clubbing of imported ‘synthetic shoe uppers’ and ‘soles and insoles’ from the same supplier at Bangkok. It is those very facts that distinguished the judgement therein from the facts in appeal before the Hon’ble Supreme Court in COMMISSIONER OF CUSTOMS, NEW DELHI VERSUS SONY INDIA LTD. [2008 (9) TMI 19 - SUPREME COURT]. Customs Act, 1962 is not a law of morality; nor is it a law of property. It is intended to provide a framework and procedure for asserting the constitutional jurisdiction assigned for levy of duty on imported goods. The consistent thread in the several decisions cited by both sides is the applicability of the framework for assessment and permitting reconstructed depiction solely on evidence of attempted subterfuge. A motive must clearly be proved. The motive should also display disproportionate windfall from such subterfuge. Neither is on record here. The goods have been imported, and presented, separately and independently; no evidence, other than conjecture about the conspiracy to disassemble branded products, is on record. Appeal dismissed - decided against Revenue.
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