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TMI Blog2024 (9) TMI 1428X X X X Extracts X X X X X X X X Extracts X X X X ..... , cleared the goods on payment of the enhanced customs duty, under protest, and requested the lower authority to issue the order(s) of assessment under Section 17(5) of the Customs Act, 1962. 4. Accordingly, the ld. adjudicating authority passed orders under Section 17(5) of the Customs Act, 1962. 5. Being aggrieved from the said assessment done by the ld. adjudicating authority, the Respondent filed appeals before the Ld. Commissioner (Appeals). The Ld. Commissioner (Appeals), after examining the issue, vide the impugned orders, set aside the orders of assessment; the value declared by the Respondent was accepted and the goods in question have been classified as 'Motor Controller' under CTH 8503 0090. 6. Aggrieved from the said orders, the Revenue is before us. 7. The Ld. Authorized Representative appearing on behalf of the Revenue submitted that the Ld. Commissioner (Appeals) has failed to appreciate that Rule 12(2)(iii) of the Custom Valuation Rules, 2007 which provides that "the proper officer shall have the powers to raise doubts on the truth or accuracy of the declared value based on certain reasons which may include - (a) the significantly higher value at which identical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of vehicle including acceleration and as also mentioned in the impugned Order-in-Appeal, control equipment are to be classified under CTH 8708, being used for acceleration etc. Hence, it is contended that the controller therefore cannot be regarded as part of 'motor' and cannot be classified under Customs Tariff Heading 8503. 8. On the other hand, the Ld. Counsel appearing on behalf of the Respondent supported the impugned orders. He relied on the decision of the Hon'ble Apex Court in the cases of Commissioner of Central Excise, Aurangabad v. Videocon Industries Ltd. [2023 (384) E.L.T. 628 (S.C.)] and Hero Electric Vehicles Pvt. Ltd. v. Commissioner of Cus., Ludhiana [2018 (364) E.L.T. 1090 (Tri. - Chan.)] 9. Heard the parties. 10. We find that in respect of both the issues, with regard to valuation as well as classification, The Tribunal in respondent own case, has considered and passed the following order vide order no. 76594- 76597/2024 dated 07.08.2024 wherein, this Tribunal observed as under:- "Regarding the issue of valuation, we find that the NIDB data, which the Revenue has relied upon for enhancing the value, is showing the assessed value and not the declared value. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised by the lower authority that the goods so imported have their declared value on the lower side and is not in consonance with the values as available in NIDB database, as already discussed supra, 1 find that the value of the similar goods depends upon the various factors as mentioned under Rule-5 of CVR-2007 which have not been examined by the lower authority in its impugned assessment order passed under Section 17(5) of the Act. In the instant appeal, I find that there is nothing on record to indicate that the price declared by the importer was not genuine. I also find that the invoice as submitted by the appellant was examined/rejected by the lower authority in its impugned order. The assessing officer's remarks only stated that the declared value "appears to be low. Also, the goods were not subjected to examination by any panel of experts or valuer. Moreover, In any event, there is no provision in the Act to say that in the absence of the manufacturer's invoice, transaction value cannot be accepted or is to be considered not to be genuine. There was therefore no reason for not accepting the transaction value. I also find that in the case of Sanjivani Non-Ferrous Tradi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y between the dates of shipment and dates of arrival of goods in the said imports. The price of the goods imported by M/s. Hibotex Put. Ltd. could, therefore, provide the basis for assessing the value of the goods imported by the appellant. The price of the goods imported by M/s. Hibotex Pvt. Ltd. was 7,00,000 Japanese Yen per set. Having regard to the fact that the appellants had contracted for a larger quantity, the Additional Collector has allowed quantity discount of 1,00,000 Japanese Yen per set on the basis of the letter of suppliers dated September 7, 1988 and he assessed the value of the goods at 6,00,000 Japanese Yen per set. The said assessment has been upheld by the Tribunal. We do not find any infirmity in the said approach of the Additional Collector. In the circumstances, we do not find any merit in the appeal and the same is accordingly dismissed. There shall be no order as to costs." As per the reading of the brief facts and the ratio laid down by the Hon'ble Apex Court in the case of Rajkumar Knitting Mills (P) Ltd. I find that in the said case, the importer i.e. M/s. Rajkumar Knitting Mills (P) Ltd. had imported the goods from the same supplier as M/s Hibote ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds imported into the country. However, placing the sole reliance on NIDB data without conducting the further enquires as accorded under Customs Valuation Rule-2007 vitiates the necessity of the valuation rules and as such making the whole process of value enhancement arbitrary in nature and non- maintainable as per law. I also find that the supplier & the quality & quantity of the goods as imported by the appellant and that relied upon by the lower authority are not in consonance. The quantity & quality of the goods and the supplier/exporter from whom the goods are imported also plays an important role in the fixation of the value of the goods keeping the true spirit of Rule-5 of CVR-2007. The same is not considered by the lower authority in the instant case. Accordingly, I find that the enhancement of values by the lower authority is arbitrary and without following any underlying legal principles read with Section 14 of the Act and Rule-5 of Customs Valuation Rule-2007. Thus the values have been enhanced without application of mind, in a mechanical manner without following Section 14 and valuation rules. As such the whole exercise of value enhancement is not maintainable and l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evice used for controlling numerous activities including that of motor. We have also gone through the definition of "controller" as provided by the adjudicating authority which reads as follows: "A Controller is a comparative device or group of devices that receives an input signal from a measured process variable, compares this value with that of a predetermined control point value (set-point), and determines the appropriate amount of output signal required by the final control element to provide corrective action within a control loop. An electric/electronic controller uses electric signals and digital algorithms to perform its receptive, comparative and corrective functions." 12.2. As per the definition of 'Controller' reproduced above, we observe that the controller has multiple usages and it is nowhere discussed in the assessment order or declaration given by the Respondent that the said motor will be employed in e-rickshaw. There is no logical reasoning provided in the assessment order that the motor has sole function of operation in e-rickshaw and cannot be operated in other mechanical equipment. The lower authority in its assessment order gave various pictorial r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itable for use solely or principally with the machines of heading 8501 or 8502." 12.6. As per the reading of descriptions as provided under Import Tariff, Section Notes to Chapter XVII and Explanatory Notes to HSN/CTH 8708, the goods imported will have the essential characteristic of parts & accessories of e-rickshaw only when the same are solely or principally used in the said vehicle. We also find that the goods as imported by the Respondent did not fulfil the description as provided in explanatory notes to CTH 8708. Further, the electronic controllers are excluded from the parts covered under CTH 8708. Moreover, the lower authority in its findings has not adduced any evidence that the goods imported by the respondent are the parts and accessories of e-rickshaw. We also observe that there is no declaration by the respondent that the said goods will be solely/principally employed in the manufacturing/making of the electric tricycle. As per the terminology of CTH 8708, the goods covered should be the parts and accessories of motor vehicles under CTH 8701 to 8705 and as per the point 3 of the Notes to Chapter XVII, the said goods having the description in two or more of the heading ..... X X X X Extracts X X X X X X X X Extracts X X X X
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