TMI Blog2023 (7) TMI 323X X X X Extracts X X X X X X X X Extracts X X X X ..... o be provided with complete details of the contemporaneous import relied upon to enhance the value. The courts have cautioned against the sole reliance of NIDB data for enhancement of value - In the case of M/S. TOPSIA ESTATES PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS, CHENNAI (IMPORT-SEAPORT) [ 2015 (1) TMI 750 - CESTAT CHENNAI ], the Tribunal held that the value declared cannot be rejected merely on the basis of NIDB data. In the present case, the department has failed to substantiate as to how the value adopted on the basis of NIDB data is comparable in the absence of details required in the nature of name of manufacturer, country of origin etc. to arrive at contemporaneous price. The facts being so, there are no sufficient reasons to reject the transaction value and for the enhancement of value. The demand of differential duty cannot sustain and requires to be set aside. Confiscation of the goods and the imposition of redemption fine and penalty - main allegation of violations of PFT Act and the PFA Rules is that the packages imported did not contain the details of manufacturer as required under the said Act - HELD THAT:- The infractions alleged under the PFA Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e name and complete address of the manufacturer and the importer should be mentioned on each of the bags that contain the food items. 3. Therefore, the officers seized the entire quantity of 506 MTs of Monosodium Glutamate imported in the 22 containers under Mahazar dated 01.08.2011 and 02.08.2011. The details of goods seized, invoice no., value as declared by the importer are given below : Sl.No. Bill of Entry No. Date Invoice No. Date Qty. (MTS) Rate per MT Total Decld. Value (CIF) Declared value (in ₹ (in CIF) Declared Duty in ₹.) 1. 3618504/ 26.05.2011 VML-11082-11 dated 04.04.2011 138 USD 1300 USD 179400 81,53,730 13,18,184 2. 4324694/ 10.08.2011 VMIN 11012 dated 18.04.2011 184 USD 1300 USD 239200 1,07,99,162 25,79,992 3. 4376254/ 17 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s prohibited by section 18 of the Sea Customs Act, 1878 (8 of 1878), shall, subject to the provisions of section 16 of this Act, apply in respect of articles of food, the import of which is prohibited under section 5 of this Act, and officers of Customs and officers empowered under that Act to perform the duties imposed thereby on a Customs Collector and other officers of Customs shall have the same powers in respect of such articles of food as they have for the time being in respect of such goods as aforesaid. (ii) (2) Without prejudice to the provisions of sub-section (1) the Customs Collector, or any officer of the Government authorised by the Central Government in this behalf, may detain any imported package which he suspects to contain any article of food the import of which is prohibited under section 5 of this Act and shall forthwith report such detention to the Director of the Central Food Laboratory and, if required by him, forward the package or send samples of any suspected article of food found therein to the said Laboratory. 6. As per sub-rule (c) to Rule 32 of the Prevention of Food Adulteration Rules, 1955, the name and complete address of the manufactur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Monosodium Glutamate is used as a flavouring agent and in terms of Section 2 (v) of the PFA Act, 1954, the subject goods are covered under the definition of Food and in terms of Rule 32 (c) of the PFA Rules, 1955, the name and address of the manufacturer as well as the importer should be mentioned on each of the bags, the department was of the view that goods are imported contravening the above provisions and therefore are prohibited for import in terms of Section 5 of the PFA Act, 1954 read with Customs Act, 1962. Hence goods imported vide the three Bills of Entry are liable for confiscation under Section 111 (d) of the Customs Act, 1962 and the importer is liable for penal action under Section 112 (a) of the Customs Act, 1962. 11. The officers also noticed that the value of goods declared by the importer which is USD 1300 per MT was significantly low when compared with the price available in the National Import Data Bank (NIDB). The officers adopted a contemporaneous price of Rs.69,750/- equivalent to USD 1550 which had been adopted in Bill of Entry No.4407862 dated 19.08.2011 of similar goods. Thus the value declared as US 1300 per MT by appellant was rejected and the va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation for violation of the provisions of the PFA Act, 1954 and Rules 1955 read with provisions of Customs Act, 1962. The original authority gave option to the importer to redeem the goods on payment of fine of Rs.30 lakhs. A penalty of Rs.70 lakhs was imposed under Section 112 of the Customs Act, 1962. The amounts paid by the appellant were ordered to be appropriated. The original authority also ordered for enforcing the bond and bank guarantee executed by appellant. 14. Aggrieved by such order, the appellants are now before the Tribunal. 15. Ld. Counsel Shri B. Satish Sundar, assisted by Dr. S. Krishnanandh, Advocate appeared and argued for the appellant. 16. On the first point of enhancement of value and demand of differential duty, it is submitted by the Ld. Counsel that the adjudicating authority has relied upon the NIDB database to re-determine the value of the goods. The adjudicating authority has taken into consideration one stray import made in Bill of Entry No.4407862 dated 19.08.2011 to re-determine the price at USD 1550 per MT against the declared value of USD 1330 per MT. It is argued by the Ld. Counsel that NIDB data per se cannot be a pointer for revaluation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of the goods in the appellant s case. This being the case, the original authority ought not to have confiscated the goods and imposed redemption fine and penalties. The infractions, if any, having been rectified pursuant to Hon ble High Court s order there are no grounds for confiscating the goods at the time of passing the order. The repacking and relabelling was done in the customs bonded warehouse under the supervision of the Customs officers and Port Health Authorities. 19. Alternatively, it is also argued that the allegation that appellant has violated Rule 32 (c) of PFA Rules 1955 is misconceived in asmuch as the said Act was repealed and the provisions of Food Safety and Standards Act, 2006 had come into effect on 05.08.2011. Therefore the provisions of FSSA, 2006 would apply to the facts of this case and the allegation of violation of PFA Act and PFA Rules cannot sustain. The FSSA, 2006 makes a distinction between Food and Food Additive . Food has been defined in Section 3 (j) and Food Additive has been defined in Section 3 (k). With respect to food, there is a requirement for labelling. The labelling regulations 2.2.1 states that every prepackaged food shall c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at various rates ranging from minimum of Rs.69,750/- per MT (USD 1550 Per MT) and maximum of Rs.77,649/- per MT. The value declared by the appellant was too low and the adjudicating authority has adopted the minimum value as available in NIDB data. Though the SCN proposes to determine the value under Rule 9 of Customs Valuation (Determination of value of Imported Goods), Rules, 2007, as per Rule 3, when the declared value is rejected under Rule 12, the next course to be followed as in sequential order from Rule 4 to Rule 8, the adjudicating authority has rightly adopted Rule 5 of the CVR 2007. 22. In regard to the argument of the Ld. Counsel that there has been no violation of provisions of PFA Act and Rules, Ld. A.R submitted that even if the goods are imported in bulk, it is necessary to mention the name and address of the manufacturer along with expiry date of the goods. The appellant has not complied with the said requirement at the time of import. Though they may have fulfilled the condition after the directions of the Hon ble High Court, the infraction having occurred at the time of import, the adjudicating authority has rightly imposed redemption fine and penalty. He pra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been held in a number of decisions that NIDB data cannot be made the basis for enhancement of value. Commissioner (Appeals) has relied upon various decisions of the Tribunal for holding that any enhancement in assessment value, the transaction value has to be first rejected based on legal permissible ground as indicated in the Valuation Rules. He has also referred to Hon ble Supreme Court decision in the case of Eicher Tractors Ltd. v. CC - 2000 (122) E.L.T. 321 (S.C.) in support of his finding that transaction value cannot be rejected without clear and cogent evidence produced by the department with regard to quality, import of origin and place and time of import. 10 . In the case of Om Sairam Trading (supra), held as under : - 5. After hearing both sides and on perusal of the record, we find that the respondents paid duty under protest as evident from the TR-6 challan produced by the respondents. This fact was also recorded in the impugned order. Commissioner (Appeals) passed the order following the decision of the Hon ble Supreme Court in the case of Eicher Tractors Ltd. v. Commissioner of Customs - 2000 (122) E.L.T. 321 (S.C.), wherein it is held that transaction v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The demand of differential duty cannot sustain and requires to be set aside which we hereby do. 26. The second issue is with regard to confiscation of the goods and the imposition of redemption fine and penalty. The adjudicating authority has held that the goods are liable for confiscation for violation of Section 2 (v) of PFA Act and the PFA Rules 1955 read with the provisions of Customs Act, 1962. The main allegation of violations of PFT Act and the PFA Rules is that the packages imported did not contain the details of manufacturer as required under the said Act. The Ld. Counsel has put forward arguments contending that the PFA Act and Rules would not be applicable as FSS Act, 2006 had come into effect on 5.8.2011. It is also argued that Monosodium Glutamate is not a food but only a food additive. 27. Be that as it may, we note that the Hon ble High Court vide order dated 23.04.2012 directed for provisional release of the goods after complying with the conditions. Relevant para reads as under : The respondent is directed to release the goods in question only on the petitioner undertaking to provide all necessary details required to comply with the local laws, at ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
