Irrelevance of Special Valuation Branch in Customs

SKODA AUTO INDIA PVT. LTD. Versus UNION OF INDIA
Writ Petition No. 4776 of 2010, decided on 23-3-2011
Stay/Dispensation of pre-deposit - Valuation (Customs) - Car kits - Transfer of technology agreement - Undervaluation - Amount of US $ 45 million paid by petitioner to Skoda under the Technology Transfer Agreement whether part of the value of 45,000 car kits supplied by Skoda to petitioner from time to time - Amount recovered from customers by adopting different accounting methods - Argument that petitioner is entitled to CVD amounting to Rs. 38.5 crores hence cannot be subjected to pre-deposit, unacceptable because taking credit would arise only when duty is paid - Argument that out of demand of Rs. 97 crores, demand Rs. 23.5 crores relates to goods cleared under provisional assessment is also without any merit, because, if imported goods were found to be cleared by suppressing material facts and resorting to undervaluation and while recovering duty that escaped assessments, which are finalized, it is open to Revenue to recover duty which escaped assessment - Exercise of discretion by Tribunal in directing the petitioner to deposit Rs. 30 crores cannot be said to be unreasonable - Sections 14 and 129E of Customs Act, 1962. [paras 21, 22, 23, 24, 25]

Jayaprakash Gopinathan 08/11/2014