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2023 (8) TMI 66 - CESTAT NEW DELHIValuation of imported goods - Zinc Scrap, Saves/Scope - rejection of declared value - declared value of the goods lower than the contemporaneous import of similar goods - sale involved an abnormal discount and abnormal rejection from ordinary competitive prices - whether the Revenue has discharged his obligation to prove undervaluation? - HELD THAT:- From the records of the case and the findings recorded by the adjudicating authority, it clearly appears that there is no evidence that the bill of entries relied on by the revenue as contemporaneous imports were of similar goods at same commercial level and in substantially the same quantity and had their origin from the same country. If undervaluation is alleged by the revenue then it is incumbent upon them to conduct detailed enquiries so as to collect substantive material and evidence to prove undervaluation. The next step is to determine the nature of the goods which are the subject matter of the contemporaneous imports as to whether they are identical goods or similar goods as defined under Rule 2(d) & 2(f) respectively - The provisions of rule 2(d) and rule 2(f) have been considered in a recent decision of the Tribunal in the case of HARIPRIYA TRADERS, FIRDOUSE INTERNATIONAL TRADING COMPANY, SHABEER ENTERPRISES, MOHAMMED FARIZ AND CO., PK TRADERS, KEVEEYAM COMPANY SUPARIWALA PVT LTD VERSUS C.C. COCHIN-CUS [2022 (7) TMI 1126 - CESTAT BANGALORE], where the test of ‘quality assessment‘ was referred for ascertaining the nature of goods under comparison - Applying the ratio of the aforesaid decision, it is found that no such case have been pleaded by the revenue and hence no reliance can be placed on contemporaneous imports by merely providing the copies of some bill of entries. The adjudicating authority noted in its order that as per NIDB import data, there are no identical goods available for determination of value as per Rule 4 of CVR, 2007. In view of such findings, it is opined that the transaction value has to be adopted as the correct value and rejection thereof is contradictory and unsustainable. The Commissioner (Appeals) has referred to the decision of the Apex Court in CENTURY METAL RECYCLING PVT. LTD. AND ANOTHER VERSUS UNION OF INDIA AND OTHERS [2019 (5) TMI 1152 - SUPREME COURT] - Applying the analogy as laid down in the aforesaid judgement, the learned Counsel referred that scrap is not a homogenous commodity and it is difficult to find any identical/ similar goods imported in India which will have same chemical and physical composition. The Tribunal is bound by the observations of the Apex Court in Century Metal Recycling (supra), and therefore in terms of para 26 which mandates to examine the matter on a case to case basis, the evidence and the material placed on record and the enquiries conducted, I find that the rejection of the transaction value is erroneous in the present factual matrix. The concept of transaction value has been provided under Rule 4 of CVR, 2007 which makes it mandatory for the authorities to accept the transaction value as provided by the importer, however the same can be rejected subject to the conditions/ exceptions as specified therein. Here it is not the case of the revenue that the transaction under consideration is covered under any of the exceptions and therefore the transaction value declared by the importer is not acceptable. No allegation has been made that the transaction was tainted or was not at arms length. No evidence has been led by the Revenue that undervaluation was on account of the circumstances mentioned in the Rules - since the present case does not fall under the exceptions provided in the Rules there is no scope to reject the transaction value. It is a settled principle of law that the onus of proving charge of undervaluation lies on the Revenue which needs to be proved by way of producing necessary evidence - Instances given by the revenue cannot be considered to be import of identical goods and in absence thereof it is not possible to sustain the charge of undervaluation. In the light of the statutory provisions under Section 14 of the Customs Act, 1962, Rule 3 and 4 of CVR, 2007 and the observations made in the various case law, it can be safely concluded that the revenue erred in rejecting the invoice price - The arguments made by the learned Counsel for the respondent, agreed upon that revenue is unable to provide any clinching evidence to prove undervaluation by the importer so as to reject the transaction value given in the invoice. The impugned order, is therefore affirmed and the present appeal filed by the Department is dismissed and the consequential relief, if any in favour of the respondent is allowed.
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