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M/s. Red Elan Distributors & Ors., Amit Goel, Director Versus C.C., New Delhi And (Vice-Versa)

2017 (10) TMI 469 - CESTAT NEW DELHI

Valuation of imported goods - foreign liquor - rejection of declared value - Since, the prices of the importer-appellants were much below than the declared prices of DDFSPL, the Department has entertained the view that there was deliberate attempt to undervalue the goods and evade substantial customs duty - Extended period of limitation - Held that: - The Bills of Entries, in the present case, were filed by the importer-appellants between the period August' 2009 to February 2013. The provisions .....

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se within a period of one year from the relevant date, calling upon the concerned person to show cause, as to why the duty cannot be recovered from him. However, in exceptional circumstances, where non-levy or short levy of duty is by reason of fulfilment of the above ingredients, then instead of the period of one year, the proceedings can be initiated within five years, for recovery of such duty - In the present case, it is an admitted fact on record that the show cause proceedings were not ini .....

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ot have been issued for extended period - In the case in hand, it is an admitted fact that the show cause notice has been issued beyond the period of one year from the date of filing the Bills of Entries and payment of duty on the declared value. Thus, the proceedings are wholly barred by limitation of time as per the dictates of Section 28 ibid. - The appeals by the importer-appellants are to be allowed on the ground of limitation - decided in favor of appellant. - C/52676 & 53090/2015-CU [ .....

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Elan Distributors Pvt. Ltd. (R.E.D.) and its Director Shri Amit Goel are that rejection of declared value in respect of the alcoholic beverages and consequent confirmation of duty demand and imposition of penalties are not in conformity with the Customs statute and thus, the impugned order is not legally sustainable. Revenue has assailed the impugned order in respect of the duty demand dropped therein. 2. Brief facts of the case are that the appellants import foreign liquor for sale to Hotels an .....

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he Department has entertained the view that there was deliberate attempt to undervalue the goods and evade substantial customs duty. On the basis of above views, the Department initiated show cause proceeding against the importer - appellants, which culminated in the impugned order, wherein by rejecting the declared value, the differential duty of ₹ 4,25,42,082/- was confirmed alongwith interest against the importer-appellants. Besides, penalties of ₹ 4,25,42,082/- and ₹ 50,00, .....

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case of the importers relates to re-assessment, where the declared value has been loaded/ enhanced on the basis of contemporaneous imports. Thus, he submitted that in absence of any allegation of mis-declaration, invoice manipulation, concealment, additional foreign exchange repatriation or admission of evasion, the duty demand cannot be fastened beyond the normal period as provided under Section 28 of the Customs Act, 1962. To support such stand, the ld. Advocate has relied on the judgement of .....

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ods should be sourced from the same country of manufacture / production. Since there is no finding as regards the country of production of the goods imported by DDFSPL, he submitted that the import price by some other importer cannot be used for comparison purpose with regard to the goods imported by the appellant -importers. He also submitted that the goods sold by DDFSPL are not at the same commercial levels as that of the sale effected by the importer - appellants, inasmuch as, DDFSPL sells l .....

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adjudicating authority has rightly dropped the demand of ₹ 25,93,723/-, since in some cases, identical goods of the importer-appellants were not comparable with those of DDFSPL. 4. On the other hand, Shri Govind Dixit, the ld. D.R. appearing for the Respondent-Revenue reiterated the findings recorded in the impugned order. He further submitted that rejection of declared value and re-determination of the same in terms of Rule 4/5 on the basis of import price of DDFSPL is in consonance with .....

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the proposed demand of ₹ 25,93,723/-. 5. Heard both sides and examined the case records. 6. The Bills of Entries, in the present case, were filed by the importer-appellants between the period August' 2009 to February 2013. The provisions for recovery of short-levied or non-levied duties are contained in Section 28 of the Customs Act, 1962. The said statutory provision mandates the time limits for issuance of the show cause notice in different circumstances. The relevant provision is e .....

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uty or interest which has not been so levied or which has been short-levied or short-paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice; (b)............ (2) ............. (3) ............. (4) Where any duty has not been levied or has been short-levied or erroneously refunded, or interest payable has not been paid, part-paid or erroneously refunded, by reason of,- (a) collusion; or (b) any wilful mis-statemen .....

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ons (2) and (4) of Section 28 ibid referred supra, it would reveal that in case of short levy or non-levy of duty, other than the situation involving collusion, wilful mis-statement and suppression of facts, the proper officer shall issue the show cause within a period of one year from the relevant date, calling upon the concerned person to show cause, as to why the duty cannot be recovered from him. However, in exceptional circumstances, where non-levy or short levy of duty is by reason of fulf .....

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s, as to whether, the Department is justified in invoking the longer period of limitation for recovery of the duty demand. 9. It is an un-disputed fact on record that the importer-appellants had filed the Bills of Entries based on the invoices and other import documents supplied by the overseas seller. The said Bills of Entries were first assessed by the assessing officer on the price declared by the importer-appellants, cleared by concurrent audit and countersigned by the proper officer. Furthe .....

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ents filed before the authorities at the port of import. More importantly, there is no specific allegation that over and above the invoice price, the importer-appellants had paid any additional consideration in respect of the imported goods, other than payments through the approved banking channel. Thus, in such eventuality, the burden of proof of involvement of the ingredients such as, collusion, wilful mis-statement and suppression of facts entirely rests with the Department and it is not for .....

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rts were all along available with assessing authorities. In other words, no new evidence cropped up belatedly, which established a fraudulent or wilful misstatement on the part of the appellant - importer. The imports were regular, both by the appellant - importer as well as by DDFSPL during the material time. Both were assessed by the same authority in the same Customs Port. 10. In context with invocation of the longer period of limitation for recovery of the duty demand and discharge of burden .....

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