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Ajay Exports, Uttam Impex, Rakesh Kumar Bhatia, Raju Bhatia, Rakesh Kumar & Co, Raju Bhatia, Arushi Exports, Tradex India Corp Pvt Ltd, Vibha Bhatia, Motilal, Arun Kapoor, Laxmi Trading Co, American Almonds Corporation, Radhey Shyam Ratanlal, Sunder Lal, Ajay Gupta, Ratan Lal, Sonia Gupta, Uttam Chand, Sunder Lal Versus CC (Import) , Mumbai And Others

Valuation - rejection of transaction value of the imported and poppy seeds from Turkey - validity of documents relied upon by hte revenue - Revenue submitted that, the differential amount is sent to the suppliers by unofficial channels, the assertion of the appellants that the entire amount has been sent through banking channels is incorrect. - Held that:- The revenue relied upon copies of export invoices and declarations submitted by the suppliers/the exporters before the Turkish authorities. - .....

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even if they may have been forwarded by 'authorities' to the investigating agency through official channels.

As regards the insurance documents as well as entries from Comtrade and UK public ledger and other journals it is now well settled law that such information cannot be used to doubt or reject the transaction value.

We also note that the adjudicating authority has refused to look at other contemporaneous imports, which are not the subject matter of the present show ca .....

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iable to be set aside and we do so. - Demand and penalty set aside - Decided in favor of assessee. - C/EH/93737/15-MUM C/85360/14-Mum - Dated:- 28-10-2015 - M V Ravindran, Member (J) And P S Pruthi, Member (T) C/EH/93737/15-MUM C/85360/14-Mum, C/EH/93740/15-MUM, C/85376/14-MUM, C/EH/93741/15-MUM C/85372/14-MUM, C/EH/93742/15-MUM C/85374/14-MUM, C/EH/93743/15-MUM C/85375/14-MUM, C/EH/93744/15-MUM C/85373/14-MUM, C/EH/93747/15-MUM C/85356/14-MUM , C/EH/93748/15-MUM C/85353/14-MUM, C/EH/93781/15-MU .....

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RDER Per M V Ravindran All these bunch of appeals are arising out of similar Orders-in-Original No. CAO/120/2013/CAC/CC(I)/AB/GR-I dated 21.10.2013 and 81/2011/CC(I)/JNCH dated 28.02.2012 passed by the Commissioner of Customs (Import), Mumbai and Nhava sheva rejecting the transaction value of the imported and poppy seeds from Turkey. The adjudicating authority has confirmed the demands raised in various show cause notices and has also imposed penalties under Section 114AA and 112(a) of the Custo .....

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were and on specific request of the learned D.R., matters were heard today. 4. As the impugned orders are more or less the same, the issues arising from all the appeals are being dealt with herein collectively. The appellant firms are comprised of 3 broad groups as under: (a) The Ratan Lal group comprising of Arushi Exports, Ajay Exports, Radhe Shyam Ratanlal (b) The Bhatia group comprising of Vibha Bhatia, Raju Bhatia, Rakesh Kumar & Co., Americn Almonds, Uttam Impex, Motilal (c) The Sunder .....

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higher value as compared to the declaration made by the Indian importer. (b) Foreign Turkish insurance documents filed by the Turkish supplier while insuring the goods. In furtherance to this the DRI received information/evidence from the Indian embassy in Moscow, said to be the documents forwarded by Turkish Customs, which in turn were forwarded to the DRI and are (a) For them export declarations made by Turkish exporter which were submitted before Turkish Customs showing a higher value as com .....

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s personal hearings to the appellants the adjudicating authority did not agree with the contentions raised and confirmed the demand's with interest and also imposed penalties. 7. Heard the counsel for all the appellants and the special Counsel for the revenue. 8. The Counsel for the appellants urged various points in the case which is summarized as under: (a) As regards the insurance documents, the adjudicating authority has acted in complete ignorance of the stated position in law inasmuch .....

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judicating authority has sought to corroborate thereof all documents of insurance on the basis of documents received from the Indian embassy, Moscow under letter dated 30/10/2009 of the first Secretary Trade, embassy of India Moscow forwarding letter dated 14/10/2009 addressed by Deputy Director General (External), prepared and sent by Turkish authorities to the first Secretary Trade, Embassy of India, Moscow, supposed to be showing an invoice-wise comparative values of Indian declaration and co .....

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majority of the entries have been redacted and cannot even be read; those what can be read does not contain the name of appellant; (iii) the perusal of the letter dated 14/10/2009 addressed to Deputy director-general, external relations, Turkey would show that that is not even a whisper of the word "poppy seeds" and further that even the subject line of this letter reads "WC O recommendation 1953" without any reference to any consignment or appellants herein; (iv) While the t .....

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no documents as regards any of the other entities; (vi) the number, nature and contents of such documents said to have been received from Turkish Customs via the Indian embassy, Moscow is not known, moreover the letter dated 14/10/2009 addressed to Deputy director general, external relations, Turkey has been sent in response after two years to a request dated 09/03/2007 which increases the doubtful nature of such documents, veracity and the relevance thereof. 8.1 Further the investigating author .....

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e used, even though they may have been forwarded by the agency to authorities i.e investigating agency through the official channels. The following case laws are relied upon for this proposition: 1. East Punjab Traders 1997 (89) ELT 11 (SC) para 5 2. V K Impex 2002 (141) ELT 564 affirmed by Supreme Court as reported at 2003 (158) ELT A 184 3. Adani exports 2009 (243) ELT 115 4. Venus Enterprises 2006 (199) ELT 661 5. South India Television Private Ltd. 2001 (136) ELT 243 6. Kainya and associates .....

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ive/higher incentive, the following case laws are relied upon South India Television Pvt Ltd. (supra), Taito Watch Manufacturing (supra), Truwoods Pvt. Ltd. (supra). 8.3 As regards the Department's reliance on Comtrade, UK Public Leger etc, the counsel stated that the impugned order has erroneously relied upon the use of data from the Public Ledger, Comtrade to show that the prize of poppy seeds was far higher than what was declared by the appellant. The impugned order then uses such date to .....

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rish International 2005 (187) ELT 94 v. Sangeeta metal (India) 2002 (140) ELT 306 vi. Ruchi associates 1992 (59) ELT 155 affirmed by Supreme Court as reported at 1992 (61) ELT A 134 vii. Radha V company 2003 (156) ELT 810. 8.4. The Counsel for appellant further argued that under the Customs Act, 1962, duty is chargeable on goods. As per Section 14(1) assessment of duty is to be made on the value of the goods. Rules have been framed which are known as the Customs Valuation (determination of Price .....

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o accept price actually paid or payable for the goods under assessment as the transaction value. This mandate is not variable but for certain exceptions specified in rule 4.2. It is only when the transaction value is rejected, then the transaction value has to be determined proceeding sequentially through rules 5 to 8. Conversely, if the transaction value can be determined under rule 4(1) and does not fall under any exceptions as provided under rule 4(2) there would be no question of determinati .....

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bout the truth and accuracy of the declared value, it may ask the importer to provide explanation for the declared value. It was further submitted that the term 'reason to doubt' does not mean include "reason to suspect", hence the investigating agency, if it suspects a transaction value, it must rely on the reasons for which investigating agency has documentation, it is the duty of the adjudicating authority to see the probative value of such documentation before rejecting the .....

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nt Ltd. 2003 (157) ELT 188 xii. Tapan trading CO. 2001 (128) ELT 456 xiii. Kumar associates 1993 (65) ELT Firebird. 8.6 It was pleaded that the appeals be allowed and impugned orders be said aside. 9. Learned Special Counsel and SDR appeared on behalf of the revenue. They supported the impugned order by submitting that the nature of the documents as discussed in the show cause notice and its evidentiary value has been thoroughly examined in the impugned order and it is based on sound reasoning. .....

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duress. It is the submission that though the retraction of the statements were made, it is not made to the same authority hence it seems to be an afterthought. It is the submission that if the values have been enhanced during the assessment, the same values cannot be disputed is incorrect as the undervaluation is due to suppression, willful misstatement and collusion hence the value of the imported goods can be re-determined and differential duty has been confirmed. It was also submitted that th .....

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price for the poppy seed's imported from Turkey into India. It is the submission that as against such data, the value declared by the appellants was very low hence the transaction value was rejected. It is the submission that on the phase of incriminating documents having evidentiary value the rejection of transaction value was correct and the submission that contemporaneous value should be adopted is also incorrect and it has been dealt by the adjudicating authority in the discussions and .....

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nce appellant has admitted to undervaluation and mis-declaration, he cannot turn around and state that valuation undertaken by the Department is not sustainable in law for this proposition reliance is placed on American eye light private Limited 2013 (290) ELT 720. 9.2 It is the further submission that after this case, the revenue has fixed the base value for the purpose of determination of duty of white poppy seed's which further supports the case of the revenue that the appellants were gro .....

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the information can similarly be used to enhance transaction value declared by the importer. (d) whether penalties need to be imposed on the appellants. 10.1 On consideration of the rival contentions and perusal of records, the following position emerges: (a) The revenue relied upon copies of export invoices and declarations submitted by the suppliers/the exporters before the Turkish authorities. This is evident from reading of paragraphs 9.1.1.1 of the 2 nd corrigendum issued and the revenue h .....

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regation and co-relating such documents would be needed. It is also seen that the comparative statement set to have been filed awarded is blacked out and most of the entries have been redacted and cannot be read. The revenue has not been able to explain this satisfactorily. It is settled law that in order to be admissible as evidence, the copies of foreign documents are required to be tested and signed by the Turkish Customs authorities which they were not. Further it is settled law that the doc .....

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e documents as well as entries from Comtrade and UK public ledger and other journals it is now well settled law that such information cannot be used to doubt or reject the transaction value. As regards the value on the insurance documents, Apex Court in the case of Orient Enterprises (supra) while affirming the judgement of the Tribunal; Christelle Violene (supra); Nina Chaka Pvt. Ld.(supra) held that the value declared for insurance purposes by the exporter cannot be the basis for redeterminati .....

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we find strong force in the submissions made by the learned Counsel for appellant that on the issue in hand, the adjudicating authority has incorrectly relied upon the values of poppy seed's by considering the same from Comtrade and UK public ledger. In our view the finding on this point are incorrect and not in consonance with the settled law. (c) We also note that the adjudicating authority has refused to look at other contemporaneous imports, which are not the subject matter of the presen .....

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ransaction value and then follow the rules as laid down from rule 5 to 9 of the valuation rules in order to arrive at the value for discharge of Customs duty. From the entire records we find that this does not seen to have been done. In addition, we find that the documents which have come from the foreign source i.e. Indian embassy, Moscow cannot bring home the charge of undervaluation in the case of Bhatia Group as none of these documents which are relied upon and received from foreign source p .....

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