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M/s. Highland Liquors Pvt Ltd, Vijay Gupta Managing Director, Shri Kumar Sheel Versus C.C.E. New Delhi

2017 (10) TMI 468 - CESTAT NEW DELHI

Valuation of imported goods - Mix Stock Lot of Alcoholic Beverages - rejection of declared value - The declared values for various types of alcoholic beverages are admittedly lower than the prices noticed by the customs in the case of other imports. Through the impugned order, the assessable value of various items have been enhanced on the basis of various bills of entry indicated in the SCN - Held that: - As per the scheme of valuation under the Customs Act 1962, as per Section 14, the transact .....

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various other bills of entry, as is cited in the show cause notice - rejection of the transaction value was not strictly in terms of the provisions of Customs Act read with the Customs Valuation Rules. - The rejection of transaction values by the adjudicating authority on the basis of bills of entry of prime goods cannot be approved. Allegations of mis-declaration of value on the above basis also cannot be sustained. However, the enhancement in value ordered by the customs appraiser on the .....

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of Entry no.5151556 dated 09.04.2014 and no.5151645 dated 09.04.2014, at ICD Patparganj, New Delhi for import of Mix Stock Lot of Alcoholic Beverages . The imports were from Dubai. Based on some alleged intelligence that the goods were grossly undervalued, the two consignments were first detained and later seized by the Department. During the investigations, statements of Shri Vijay Gupta, MD, of the appellant company, and of Shri Kumar Sheel, Customs Appraiser, were also recorded. The seized go .....

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lties were proposed on the company as well as on Shri Vijay Gupta, the Managing Director. 2. Shri Kumar Sheel, the Customs Appraiser who had assessed the two bills of entry, was also made a noticee to the show cause notice and penalty was proposed against him. 3. The Principal Commissioner Customs (Prev) passed order dated 30.03.2016 confirming the full demand of duty along with interest, confiscating the seized goods and imposing a redemption fine of ₹ 15 lakhs. A penalty of ₹ 20 la .....

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Counsel for the appellants summarized the grounds of appeal as follows: i) The SCN has proposed enhancement of the value of goods imported vide the two bills of entry on the basis of 21 bills of entry in which comparable goods were imported. However, only 15 out of the 21 bills of entry were supplied to the appellants. Hence the appellant was not in a position to put up a proper defence before the adjudicating authority. ii) The declared value has been rejected only on the basis of suspicion. T .....

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hese goods were meant for sale in UAE, but have been diverted to India as parallel imports at discounted prices. iv) The Customs Appraiser Shri Kumar Sheel, in his statement has admitted that he assessed the value of the two consignments correctly after checking the NIDB data of stock lot goods, after loading the values wherever necessary. Hence further loading of the value through the impugned order is not permissible as held in the following cases: a) CC (Prev) Mumbai Vs. Paras Electronics - 2 .....

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The other four bills of entry relate to imports by duty free shops. Such imports cannot be considered as comparable goods as they are sold only at international airports. 7. Accordingly he submitted that the impugned order was not sustainable. 8. It has been submitted on behalf of the Appraiser, Shri Kumar Sheel, that he had performed his duty in accordance with the prevalent practice in the Custom House. He had verified the value of mix stock lot from NIDB, enhanced the value in a few cases an .....

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respect of description or quantity was noticed. Accordingly, it has been submitted that the penalty imposed on the Appraiser may be set aside. 10. The ld. DR justified the impugned order. He argued that various types of liquor have been imported at extremely low prices and hence these values have been rightly enhanced and differential duty demanded. 11. Heard both the sides and perused the record. 12. The goods imported vide the two bills of entry have been declared as mixed stock lot of alcoho .....

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ods cannot be compared with import of prime goods since the import consignments are made up of various brands which have been sold together at discounted prices to clear the stock from UAE market. 13. As per the scheme of valuation under the Customs Act 1962, as per Section 14, the transaction value is required to be accepted for assessment purposes except in circumstances, outlined in Rule 3 (earlier Rule 4) of the Custom Valuation Rules. Unless the price actually paid for the transaction falls .....

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ransaction value. But the mandate is not invariable and is subject to certain exceptions specified in Rule 4(2) namely : (a) there are no restrictions as to the disposition or use of the goods by the buyer other than restrictions which (i) are imposed or required by law or by the public authorities in India; or (ii) limit the geographical area in which the goods may be resold; or (iii) do not substantially affect the value of the goods; (b) the sale or price is not subject to same condition or c .....

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ovisions of sub-rule (3). 14. In the present case, we find that the adjudicating authority has not recorded any specific reason for disregarding the transaction value, other than the suspicion that values are mis declared as seen by comparison with various other bills of entry, as is cited in the show cause notice. Hence, we conclude that rejection of the transaction value was not strictly in terms of the provisions of Customs Act read with the Customs Valuation Rules as held by the Hon ble Apex .....

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ous types of alcoholic beverages with different brand names. It has also been submitted that these belong to old stock, labels were damaged, packaging indicates that it is meant for sale in UAE market, etc. Such goods are stock cleared and sold to the importer as parallel imports at discounted prices. Hence we are of the view that the value of such goods cannot be compared with the values declared for individual import consignments of prime branded liquor consequently. We set aside the enhanceme .....

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