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Valuation of imported goods, Goods and Services Tax - GST

Issue Id: - 117706
Dated: 17-12-2021
By:- Rajesh Kumar
Valuation of imported goods

  • Contents

Sir/ Madam

An importer imports motor scrap containing for example 10% copper. Now department calculation value of imported scrap by mathematical calculation for examples total Value with taxes/ total weight *10% which comes about ₹ 300/kg as purchase cost whereas party selling the said copper after extracting from motors and using manpower at the rate of Rs. about 150/ kgs.

In this process the ITC is also getting accumulated.

Is department can make a case of under valuation of goods ?

Please enlight all angles from party and department side.

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Showing Replies 1 to 2 of 2 Records

1 Dated: 20-12-2021
By:- Shilpi Jain

Query is not very clear. However, under Customs also the department has to first reject the valuation adopted and then apply the valuation rules in sequential manner to arrive at the taxable value. They cannot adopt any means as such to value the imported goods.

2 Dated: 23-12-2021
By:- raghunandhaanan rvi


Generally, the customs department may reject the declared value if they have evidence of contemporaneous imports or material evidence to charge of undervaluation. If you disagree with the decision of the department on the value enhancement and charge of undervaluation, you may insist issuance of speaking order and appeal against it before the appellate forum.

In the meantime, you may request the department to allow clearance of goods provisionally subject to execution of PD bond with a bank guarantee for disputed duty value. This is my view.


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