TMI Blog2013 (9) TMI 177X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, the department had to give cogent reasons for such rejection - The assessing authority had to examine each and every case on merits for deciding its validity and he cannot form a view to reject all transaction values on the basis of some general criteria based on DGOV Circular and on that basis load the value of imports uniformly across board. The proposition in the show cause notice was that the value of the contemporaneous imports indicated a higher price - If that be so, that should have been the starting point for determination of value of the imported goods and not some other basis - Further even when we take the values of the contemporaneous imports, the lowest of such value has to be adopted as provided for in Rule 6 and not the highest - no such thing had been done by the assessing officer – Decided against revenue. - C/931-970/2010 - A/434-473/2012-WZB/C-I(CSTB) - Dated:- 4-6-2012 - Shri Ashok Jindal and P.R. Chandrasekharan, JJ. Shri Navneet, Addl. Commissioner (AR), for the Appellant. Shri Anil Balani, Advocate, Rajesh Agarwal, CA, Mayur Shroff, D.H. Nadkarni, Ganesh K.S. Iyer, A.V. Naik, J.H. Motwani, N.S. Patel and Prashant Patankar, Advocates, for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore being graded. Therefore valuation of metal scrap cannot be done under the provisions of Rules 5 to 7A by proceeding sequentially. Hence the value was required to be determined under Rule 8 (residual method), using reasonable means consistent with the principles and general provisions of these Rules and on the basis of the data available in India. The following methodology was adopted for valuation of the impugned goods. There are 34 types of aluminium scrap as per Institute of Scrap Recycling Industries (ISRI) which provides guidelines and definitions of all types of non-ferrous and ferrous scrap. Analysis of the import data revealed that 15 types of scrap accounted for more than 90% of the total volume of aluminium scrap. Prices of all the 15 grades of scrap have been linked to the price of the prime metal as traded in LME in the form of discount from the price of the prime metal. The international price of aluminium scrap of different grades, namely, twitch, tread, trump, taint/tabor, talk, tale, tense, taldon, twang, tassel, throb, testy, telic, talon, tablet are 30%, 20%, 30%, 32%, 5%, 25%, 30%, 35%, 15%, 15%, 30%, 35%, 35%, 7% and 9% respectively less from the price of pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow cause notice but has been referred to in the order-in-original. On the basis of Hon ble Apex Court judgment in the case of Varsha Plastics v. Union of India - 2009 (235) E.L.T. 193 (S.C.), he concluded that the circular cannot be interpreted to mean that transaction value has to be rejected if it is not conforming to the value arrived at on the basis of LME bulletin after allowing the discounts prescribed therein and the said circular does not override the express provisions of Section 14 of the Customs Act or the CVR. Inasmuch as the transaction value has been rejected under Rule 10A, the assessing officer was required to determine the same by proceeding sequentially under Rules 5 to 7A and thereafter, invoke Rule 8 if the preceding rules are not applicable. He observed that in the instant case, the invoice value produced by the importers have been rejected and the value has been loaded on the basis of DGOV Circular on a uniform basis which is not permissible in law as per the decision of this Tribunal in the case of Commissioner of Customs v. FSP (India) Pvt. Ltd. - 2009 (234) E.L.T. 268 (Tri.-Mum.) and the Hon ble Apex Court in the case of Eicher Tractors Ltd. v. Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity, the Revenue is in appeal before us. 3. The learned AR appearing for Revenue contends that if there was denial of natural justice to the importers while passing the assessment orders, then the remedy was for remanding the case back to the original adjudicating authority which has not been done in the instant case. He further contended that as has been held by the Hon ble Apex Court in the case of Commissioner of Customs, Vishakhapatnam v. Aggarwal Industries Ltd. - 2011 (272) E.L.T. 641 (S.C.) the department could invoke Rule 10A where they had reason to doubt the truth and accuracy of declared transaction value. In the instant case, the importers were asked to submit letters of credit and other documents relating to the transactions which they failed to do and, therefore, invocation of Rule 10A for rejection of transaction value was justified. He also argued that once the Revenue discharges the burden of proof of producing evidence of contemporaneous import at a higher price, then the onus shifts to the importer to prove that the price indicated in the invoice relied upon by him is correct. He also relied on judgment of the Hon ble Apex Court in the case of Radhey Shyam Rata ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p during relevant period was noticed at the rates indicated in the enclosed Annexure - B which approximate or higher than the declared value. 5.3 But in the show cause notice as well as the assessment order, resort has been made to Rule 8 of the CVR read with Rule 10A. If value of similar goods were available, as stated in the show cause notice, that should have been the basis for determining the value of the goods under Rule 6 as it stood at the relevant time subject to making necessary adjustments, taking into account the quantum of import, country of origin, quality of the scrap received and other relevant factors. That has not been done in the instant case. The assessing officer has straightaway adopted the value given in the DGOV Circular based on the LME prices of prime metal minus discounts. While resorting to Rule 8, the assessing officer has stated that Rules 5 to 7A could not be applied for want of prices of contemporaneous imports. In other words, the findings completely contradict the proposition in the show cause notice that contemporaneous imports were noticed at same or higher prices. If contemporaneous imports were not noticed on the basis of which Rules 5 and 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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