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2021-TIOL-321-CESTAT-CHD
Bansal Steel Power Ltd Vs CCE & ST
CX - The appellant is in appeal against impugned order wherein the credit has been denied on returned goods under Rule 16(1) of CER, 2002 alleging that the credit has been taken by appellant on fake letter issued by recipient of goods - In the statement of consignee, M/s. Adarsh Enterprises and M/s Gandhi Springs, it is clearly mentioned that they have not returned goods but produced the ledger account - The ledger accounts are with the department, the department could have verified their statement whether same is correct or not - The said documents have been hidden by department and not brought on record, therefore, the allegation without evidence is not acceptable in law - Further, the appellant sold the goods to M/s Sikkim Ferro Alloy but neither any investigation nor statement ever recorded during investigation of M/s Sikkim Ferro Alloy - In the circumstance, investigation conducted by department is faulty, therefore, credit cannot be denied to the appellant: CESTAT
- Appeal allowed: CHANDIGARH CESTAT
2021-TIOL-320-CESTAT-DEL
Shahid Ali Vs Pr.CC
Cus - In the relevant period the premises of several importers, including the appellants herein, were subjected to Search operations, based upon intelligence regarding undervaluation & misdeclaration into import of food supplements - In course of such searches, some documents, some CPUs and laptops were recovered - Additionally, some quantity of imported food supplements were seized as well - Statements were taken of the proprietors of the searched premises, some of whom were offered provisional release of the goods, subject to partial discharge of duty liability - In course of investigations, it appeared to the Department that one of the importers had manipulated the invoices to lower the value mentioned therein - Hence from comparison of actual and fake invoices, it emerged that one of the importers was allegedly involved in undervaluation & misdeclaration of Food Supplements and was declaring 50% lower value than the actual value - Such person was also alleged to have generated fake invoices in the name of the firm controlled by him, showing lower value and with a view to evade Customs duty, though the original invoices were admittedly raised by the foreign suppliers in his name - The Department also observed that MRP prices were not the actual MRP but fake stickers were prepared in conformity with the declared under invoiced prices to the Customs - The Department alleged that the MRP stickers which were meant for the goods to be sold from his shop were having much higher value than the one as was mentioned on the stickers affixed on the food supplements at the time of import - It was alleged that this was done by the particular importer in order to evade CVD who intentionally declared lesser RSP of food supplements - Hence SCNs were issued to the particular importer, as well as to the companies of which he was proprietor - SCNs were also issued to the remaining firms and their respective proprietors - On adjudication, the proposals in the SCN were upheld. Held - + The issue involved in the present case is about the transaction value of the food supplements imported by the appellant. We observe that the valuation of imported goods is required to be done in terms of section 14 of the Customs Act, 1962 read with Customs Valuation Rules, 2007 which provides that transaction value of the goods shall be the price actually paid or payable for the goods when sold for export to India where the buyer or the seller of goods are not related and the price is the sole consideration for the same subject to such other conditions as may be specified under the Rules made in this behalf. The Valuation Rules have been framed in exercise of powers conferred by section 14 of the Customs Act and in normal course, the declared value i.e. the price which is actually paid for importing the goods has to be treated as the transaction value. This is settled position law of as being held by Apex Court in the case of NOIDA vs. M/s. Sanjivani Non-Ferrous Trading Pvt. Ltd (Civil Appeal No. 18300-18305/2017) decided on 10.12.2018 = 2018-TIOL-447-SC-CUS wherein it has also been held that the said transaction value / declared price can be rejected only with the cogent reasons by undertaking the exercise as to on what basis the assessing Authority could hold that the paid price was not the sole consideration of the transaction value and the burden casts upon the department to prove the same in accordance with the directions given under Customs Valuation Rules, 2007. (Para 11) + We also observe that the said transaction value can be rejected under Rule 12 of Valuation Rules, 2007 which provides that when the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, he may ask the importer of such goods to furnish further information including documents or other evidence and if, after receiving such further information, or in the absence of a response of such importer, the proper officer still has reasonable doubt about the truth or accuracy of the value so declared, it shall be deemed that the transaction value of such imported goods cannot be determined under the provisions of sub-rule (1) of Rule 3. Explanation in (iii) to Rule 12 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 any of the six reasons contained therein, one of which is that there is a significantly higher value at which identical or similar goods imported at or about the same time in comparable quantities in a comparable commercial transaction. (Para 11) + In the present case, no doubt arose on the basis of comparable quantities in comparable commercial transaction nor it was observed at the time of clearance at the very port. But it is apparent that doubt arose on the basis of intelligence whereafter searches were conducted and recovery of documents and impugned imported food supplements got effected. Apparently no data or evidence is collected by the department after the said intelligence and during investigation as is otherwise required under Rule 4, 5 and 6 of the CVD Rules 2007 and is also required under Rule 12. But, we observe that the present is the case where importer has admitted the entire allegations of alleged manipulation / forgery in the invoices as far as the price of imported goods are concerned. We also observe that the importer has specifically admitted procurement of food supplements from foreign supplier by paying significantly higher price than the amount as was declared by him to the department at the time of filing of Bill of Entry. This admission is not made once but for more than 5 number of times by the importer i.e. Shri Sunny Gujral. Perusal of the statement of importer dated 02.08.2006, 04.08.2006, 12.08.2006, 14.12.2006 and 05.11.2008, shows that in the admissions made, each previous statement of admission has dully been acknowledged as correct in the subsequent statement. Such corroborative admission with no single retraction thereof till date. No opportunity to prove the correct transaction value of goods by providing any documents as that of Bank attested generated invoices, as per our opinion, is the sufficient admission by the appellant for the guilt as alleged by the Department against the appellant. We are also of the opinion that in such facts and circumstances there remains no need for Revenue to discharge its burden as that of collecting evidence in the form of contemporaneous imports or to produce any NIDB data or even any market survey report. In Kackar Singh vs. State of Punjab 1994 (3) SCC 569 guidelines for recording confessions impressing upon that comfortable atmosphere be provided to the person to volunatarily give the statements. As per decision in State (NCT of Delhi) vs. Navjot Sandhu [2005 (11) SCC 600] confessions are considered highly reliable because no rational person would make admission against his interest unless prompted by his conscience to tell the truth. Deliberate and voluntary confession of guild if not unproved are among most effective proof in law. We also place our reliance upon the decision of this Tribunal in the case of Laxmi Enterprise vs. Commissioner of Customs (Prev), New Delhi reported as [2018 (361) ELT 1054] = 2018-TIOL-1293-CESTAT-DEL . The Apex Court in the case of Commissioner of Central Excise, Madras vs. Systems and Components Pvt Ltd. [2004 (165) ELT 136 (SC)] = 2004-TIOL-137-SC-CX has held that once there is admission of guilt, Department need not to prove the same. (Para 12) + We also observe that at the stage of redetermination of value during investigation, the appellant himself had opted to pay the assessed differential duty. The voluntary payment is sufficient corroboration to his admitted manipulation for evading the duty. Such payment also amounts to the admission of appellant about re-determining value of the imported goods at lower prices. Though the learned Counsel has placed reliance upon the decision wherein it has been held that payment of duty at the stage of investigation does not amount to the admission of guilt. But in the present case, the fact is that the guilt has not merely been admitted once, but it has been admitted in corroboration, at six number of times with no single retraction of either of these admissions nor there is any protest recorded while making payment in lieu of re-determined value. In the given circumstances we are of the opinion that the arguments of learned Counsel do not go to the root cause of his appeal. Decision of Hon'ble High Court of Delhi in Jai Shiv Trading vs CCE New Delhi [2018 (359) ELT 208] = 2017-TIOL-4502-CESTAT-DEL has held that once the importer admitted redetermination of value on record and accepted the method of such valuation, redetermination of value cannot be challenged on the same ground. Earlier Tribunal Delhi in the case of Vikas Spinners vs Commissioner of Customs, Lucknow reported as [2001 (128) ELT 143] has held that enhanced value uncontested and voluntarily accepted and accordingly payment of duty made, the same discharges the burden of department to establish the declared value to be incorrect. It was held in that case that, since the appellant therein had not established about the lodging the protest, the same clearly amount to acceptance of the enhanced value by them. Same is the fact of the present case. Tribunal, Mumbai also in the case of Saccha Saudha Pedhi vs. Commissioner of Customs (Import), Mumbai reported as [2015 (328) ELT 609 (Tri-Mumbai) has held that once the witnesses admitted to undervaluation and accepted actual price of imported goods mentioned in the purchase orders messages of supplier, then the said admitted price becomes transaction value in which case, there is no need to resort to contemporaneous import. (Para 13) + In the present case, we observe that Sunny Gujral has categorically admitted for having discussed with the Foreign suppliers about the actual price and that the said actual prices were mentioned on the invoices received from the foreign suppliers. It is thereafter that Shri Sunny Gujral used to prepare fake invoices in his computer reducing the price of the invoices of foreign supplier to the extent of almost 50% thereof so as to file the same along with Bill of Entry. He also admitted, categorically that the prices of the fake invoices were used to be given through the valid mode of money transfer. The balance price i.e. the difference of the price of original invoice as received from foreign vendor and the fake invoice generated by Shri Sunny Gujral is categorically admitted to be sent to the foreign supplier through his relative based in America. In view of entire alleged guilt to have been specifically admitted by Shri Sunny Gujral, we hold that there remained no burden upon the Department to prove the allegations against the appellants nor the department was required to comply with section 138 C of the Customs Act with respect to the documents being the computer print outs, the data whereof has dully been acknowledged to have been filled in by Shri Sunny Gujral himself. (Para 14) + However, we further observe that in addition to the admission as discussed above, there is no similar admission of the alleged under valuation to have been done by rest of the importers and by the proprietor of the rest of the impugned importing firms/ appellants M/s. Jaskaran Enterprises, proprietor Shri Sunny Gujral himself. The perusal of the statements of remaining proprietors i.e. Shri Shahid Ali, of M/s. Mondeo Overseas, Shri Rashid Ali of M/s. Kamlin International and Shri Mardana Singh of M/s. General Nutrition, reveals that Shri Sunny Gujral was the controller of all the imported firm established and maintained by and controlled by him alone. None of them had the knowledge of the activities of Shri Sunny Gujral who used to take the blank cheques from them. It is also apparent from their statements that at the time of clearance at port and also at the time of delivery of goods to his dealers, Shri Sunny Gujral personally used to go. The shop keeper of M/s. Total Fitness Shop also deposed about the sole activity and responsibility of Shri Sunny Gujral about importing and selling the food supplements. As already observed / mentioned above, there is no apparent evidence by the Department with respect to either of the four importing firms and the respective proprietors about alleged undervaluation and forgery. In absence thereof the admission of Shri Sunny Gujral cannot be read against Shri Shahid Ali, Shri Rashid Ali, Ms. Ekta Gujral and even against Shri Mardana Singh, nor it can be read against other importing firms than M/s. Jaskaran Enterprise whose invoice. The law has been settled law that confession of an accused cannot be read against the other accused. (Para 15) + The statement of Shri Sunny Gujral as was recorded by Customs Officer under section 108 though can be a substantive evidence against Shri Sunny Gujral of alleged offence of under valuating the imported food supplement by making fake invoices but in view of the above discussion, said admission cannot be read against any other importer, the said statement of Shri Sunny Gujral being the admission of his own guilt and of none else. (Para 17) + In view of these observations, we hold that though there is no illegality in the order of the adjudicating authority below while confirming the allegations of under-invoicing the price of imported food supplement by manipulating the invoices against Shri Sunny Gujral based upon his admission. But we are of the opinion that in the absence of any document produced by the department to prove their allegation, as against other importers and proprietors either in the form of Bill of Entry or any invoices either of the foreign supplier or the fake invoices with respect to any of these importers and that admission of Sunny Gujral cannot be read against the other importer irrespective of the fact that these firms were managed and controlled by Sunny Gujral himself none else than Shri Sunny Gujral can be penalised. In such circumstances, the order under challenge confirming the demand of differential duty from the remaining importers other than M/s. Jaskaran Enterprises and imposition of penalty on other proprietors other than Shri Sunny Gujral is not sustainable in the eyes of law. (Para 18) + The demand confirmed by the Original adjudicating authority is hereby ordered to be modified in terms of the above entire discussion. It is clarified that the order under challenge is upheld only about Shri Sunny Gujral the proprietor of M/s Jaskaran Enterprise. However, the order of demand and imposition of penalty on other importing firms and their respective proprietors is hereby set aside. Since the amount of Rs.12.95 lakh has already been deposited by Shri Sunny Gujral, the same is hereby ordered to be set off. In view of above findings, there remains no further recovery to be effected. The order under challenge stands accordingly modified. Consequent thereto all the appeals stand partly allowed. (Para 19)
- Appeals partly allowed: DELHI CESTAT |
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