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2018 (3) TMI 766

entire basis for rejecting the transaction value at which goods were cleared from appellant to Unit-II is the relationship between them - Held that: - Merely because the two units are related persons, the same would not ipso facto be the ground for rejecting the transaction value. Rule 3(3)(a) of the Customs Valuation Rules, 2007 specifically provides that where the buyer and seller are related, the transaction value shall be accepted provided that the examination of the circumstances of the sale of the imported goods indicate that the relationship did not influence the price - The comparison of values can only be made in respect of consignments which compares in terms of identity of the goods as well as the quantity of the transaction. Hence, this comparison is not a valid basis for rejecting the transaction value. - Clandestine removal - Held that: - there is no corroborative evidence on record to substantiate the stand of the Department that the goods reflected in the diary titled as “MONARK” were clandestinely cleared. The Department also has not carried out investigation regarding the purchase of extra raw material required for manufacture of such additional quantity of Un .....

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view, the Department was not correct in adopting the price at which the Unit-I had imported 200 to 500 halogen capsules as sample as the quantum of DTA sales being made by the 100% EOU was much larger and in this regard, the import price of gold coated Halogen Capsules was not relevant, as the 100% EOU (Unit-I) was not manufacturing such halogen capsules. Moreover, in terms of the information furnished by the appellant, contemporaneous import of similar goods in comparable quantity had been made at the prices which were comparable with the DTA sale price adopted by the appellant unit. However, we find that the Commissioner has not given any finding on this plea. We are, therefore, of the view that the impugned order rejecting the DTA sale price of the appellant unit is not correct and the same has to be set aside and the matter has to be remanded to the Commissioner for denovo adjudication after considering the appellant s plea that during the period of dispute, other importers had imported similar goods in comparable quantities at the prices which were comparable with the DTA prices adopted by them and if this is so, there would be no justification for rejecting the DTA sale pric .....

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goods under assessment is more or less corresponding to the FOB value of exports in the case of goods of identical nature and in conformity with the provisions of Rule 4of the Customs Valuation Rules, the same can be accepted as transaction value. Ld. Commissioner has ignored the CBEC s circular. He further submitted that costing data was provided by the appellant which supports the value adopted by Unit-I for payment of duty. (iii) Ld. Commissioner did not analyse the issue but merely reproduced the paragraph from the show cause notice and confirmed the demand. (iv) With reference to the allegation of clandestine removal, ld. Counsel argued that the allegation has been made on the basis of the note book MONARK which was seized from the unit. The author of the diary was Sh. Satyanarayanan, Store Keeper but he has not been examined. Even though, his statement was recorded, the same has not been made available to the appellant. The Department cannot prove the contents of the diary by relying upon the retracted statements of others. In any case, he submitted that no evidence has been brought in the show cause notice to show the quantity of raw material obtained by the appellant for ma .....

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that Rule 7 has no application in the circumstances. 10. The entire basis for rejecting the transaction value at which goods were cleared from appellant to Unit-II is the relationship between them. Merely because the two units are related persons, the same would not ipso facto be the ground for rejecting the transaction value. Rule 3(3)(a) of the Customs Valuation Rules, 2007 specifically provides that where the buyer and seller are related, the transaction value shall be accepted provided that the examination of the circumstances of the sale of the imported goods indicate that the relationship did not influence the price. The Department has compared the assessable value with the price at which certain types of Halogen Capsules has been imported by the appellant and found that the clearance from Unit-I to Unit-II were undervalued. But the appellant has strongly contended that the cited import were only for import of samples and the consignment was only for 200 to 500 nos. whereas the quantity of goods cleared into DTA is in lakhs. The comparison of values can only be made in respect of consignments which compares in terms of identity of the goods as well as the quantity of the tran .....

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