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2026 Supreme(Online)(CESTAT) 556
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
R. Muralidhar, Judicial Member, Rajeev Tandon, Technical Member
Anjum International – Appellant
Versus
Commissioner of Customs – Respondent
Customs Appeal No. 75933 of 2023
For the Appellants/Petitioners: None
For the Respondents: S. Debnath, Authorized Representative
The transaction value of imported goods cannot be rejected solely based on NIDB data; it requires compliance with the sequential valuation procedure under the Customs Valuation Rules, 2007, and the existence of objective, reasonable grounds to doubt the declared value as per Rule 12.
Headnote:(A) Customs Act, 1962 - Section 14 - Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 - Valuation of imported goods - Transaction value - Rejection of - The Assessing Officer rejected the transaction value and enhanced the same based on NIDB data without following the sequential procedure prescribed under the Valuation Rules - Apex Court held that 'reason to doubt' the accuracy of the declared value must be based on objective grounds as per Rule 12 - Mere reliance on NIDB data without rejecting the transaction value or providing a plausible explanation for undervaluation is impermissible - Appellate order remanding the matter failed to address the lack of procedural compliance by the adjudicating authority. (Paras 4, 5, 6, 7 and 10)
Facts of the case:
The appellant imported non-LED and LED lights and declared a total assessable value of Rs.45,36,497/-. The adjudicating authority rejected this declared value and enhanced it based on NIDB data, re-determining the assessable value at Rs.15,32,982/- and duty at Rs.29,57,568/-. The Commissioner (Appeals) remanded the matter for re-examination, against which the appellant filed the present appeal.
Findings of Court:
The tribunal found that the Department failed to establish any ground to doubt the truth or accuracy of the declared transaction value as required under the Customs Valuation Rules. No sequential procedure was followed to determine the value, and the direct application of NIDB data without rejecting the transaction value was held to be improper.
Issues: Whether the adjudicating authority was justified in rejecting the transaction value and enhancing it based solely on NIDB data without complying with the sequential procedure and providing reasons for such doubt.
Ratio Decidendi: The revenue cannot disregard the transaction value without meeting the requirements of Rule 12 of the 2007 Rules, which mandates a two-step verification and recording of objective reasons. In the absence of such procedural compliance, the enhancement of value is unsustainable. Result : Appeal allowed.
| Table of Content |
|---|
| 1. factual background of the valuation dispute and remand order. (Para 1 , 2) |
| 2. failure to follow sequential valuation procedures under customs valuation rules. (Para 3 , 4 , 5 , 6) |
| 3. requirement of objective reasons to doubt transaction value per apex court. (Para 7 , 8 , 9 , 10) |
| 4. final outcome and setting aside the lower order. (Para 11) |
PER R. Muralhdhar :
Appellant had imported non-LED and LED lights during the period 12.09.2016 to 14.10.2016. The appellant filed three Bills of Entry for the consignments received from abroad. They have declared the total assessable value of Rs.45,36,497/-. They were allowed to clear the imported goods on provisional basis. Subsequently, Order in Original dated 27.03.2018 was passed, finalizing the provisional assessment. The adjudicating authority has relied on the NIDB data to enhance the value of the imported goods. He has re-determined the assessable value as Rs.15,32,982/-. He has re-determined the duty at Rs.29,57,568/- as against Rs.11,81,184/- paid by the appellant. He has also ordered for payment of interest under Section 18(3) of the Customs Act 1962.
2. Being aggrieved by the enhancement of the value and enhanced determined customs duty, the appellants have filed their appeal before the Commissioner (Appeals). After going through all the data made available to him and the documentary evidence placed before him, the Commissioner (Appeals), has held that the assessing officer has erred in rejecting the transaction value without any valid basis or reasons and without following the due procedure as specified under Section 14 of the Customs Valuation Rules. He has remanded the matter back to the original authority to re-examine the matter after giving opportunity to the appellant. The appellant has filed an appeal being agitated by this remand order by the Commissioner (Appeals).
3. No one has appeared on behalf of the appellant. We find that even the intimation letters being sent to the appellant is being returned back by the postal authority. Therefore, we have taken up the appeal itself for disposal with the active help of the Ld D R.
4. On going through the OIO, we find that the adjudicating authority has enhanced the value of the imported goods, based on the NIDB data as can be seen from Para 5 of this order, which is reproduced below.
“5. At the time of finalization of the said provisional assessment under Section 18(2) of Customs Act, 1962, the Department had come across evidences of contemporaneous imports of similar goods through other Customs locations at much higher value than the value at which provisional assessments were done in this Port. As per NIDB data, it had been noticed that during the period from July,2016 to September, 2017 in 1978 cases, covering 348 Bills of Entry, the other Customs locations like INTKD6(Tuglaqabad ICD), INNSAI (Nhavasheve Port), INBOM1 (Mumbai Port) & INMUN1 (Mundra Port), have assessed Led Christmas light after taking alue per bulb as Rs.55/bulb or more and in 1341 cases, covering 384 Bills of Entry and non-LED Christmas lights have been assessed at 0.30/ bulb or more.”
5. In terms of Customs Valuation Rules 2007, first and foremost, if the transaction value as shown by way of invoice and documentary details by the importer, the assessing officer is required to go through the veracity of the same. Only when he is not satisfied with the transaction value shown in the invoice, the Revenue can go to the other portion of the C V Rules to enhance the value of the consignment. As per Section 14 (1) of the Customs Act, 1962, the value of imported goods shall be the ‘transaction value’, in the normal course even if the exporter and importer are related parties. There is no allegation to this effect in the present proceedings. In case this value is not found to be correct, the procedure specified under Customs Valuation (Determination of value of Import goods, 2007) (CVR, 2007 in short) Rules, is required to be followed, sequentiall
