Per Mr. VASA SESHAGIRI RAO

The present proceedings comprise of three appeals filed before this Tribunal, one by M/s. Sleek Corporation (the importer-appellant) and two by its partners, Shri Mahesh Agarwal and Shri Viresh Kothari, upon whom personal penalties have been imposed. All the three appeals arise out of the same Order-in-Original No. 45540/2016 dated 09.03.2016 passed by the Commissioner of Customs- II, Chennai (hereinafter referred to as the impugned order). As the issues involved, facts, evidence, and findings are common and interlinked, all the appeals as tabulated below are being taken up together and are being disposed of by this common order.

2.1 The Appellant-Importer is a partnership firm engaged in the import of industrial sewing machines, their parts and accessories, and rotary hooks, during the period from 01.06.2010 to 30.11.2014, through Chennai Seaport. The firm is represented by its partners Shri Mahesh Agarwal and Shri Viresh Kothari, who are also co-appellants as shown in the Table above.

2.2 Acting on specific intelligence regarding large- scale undervaluation and mis-declaration, officers of the Directorate of Revenue Intelligence (DRI), Bangalore, conducted searches on 01.12.2014 at the business and residential premises of the appellants. Various documents were seized, including proforma invoices, email correspondence, blank signed letterheads of overseas suppliers, a diary containing pricing details, and electronic records.

2.3 Statements of both the partners were recorded under Section 108 of the Customs Act, 1962, wherein they admitted, inter alia, that the imports were systematically undervalued, that two sets of invoices were prepared one reflecting the actual value and another for customs clearance and that differential amounts were paid through non-banking channels.

2.4 A Show Cause Notice dated 28.05.2015 was issued proposing rejection of declared transaction value under Rule 12 of the Customs Valuation Rules, 2007, re- determination of assessable value at ₹22,06,28,290/- against declared value of ₹11,20,05,936/-, demand of differential duty of ₹1,71,26,244/- with interest, confiscation of seized and already cleared goods under Sections 111(d) and 111(m), and imposition of penalties under Sections 114A and 114AA.

2.5 The Commissioner of Customs-II, Chennai, vide Order-in-Original No. 45540/2016 dated 09.03.2016, confirmed the proposals. Aggrieved, the appellants are before this Tribunal.

3. The Ld. Advocate Mr. L.S. Karthikeyan appeared on behalf of the Appellant and made the following submissions which are summarized as below: -

3.1 The impugned order is mechanical, non- speaking, and merely reproduces the Show Cause Notice without independent analysis of the defence’s submissions.

3.2 He has contended that the declared transaction value could not have been rejected without first establishing that the conditions of Rule 3(2) of CVR, 2007 were attracted, as held by the Supreme Court in Eicher Tractors Ltd. v. CC [2000 (122) ELT 321 (SC)].

3.3 Unsigned proforma invoices have no evidentiary value and cannot be relied upon to enhance assessable value unless actual imports at such prices are demonstrated.

3.4 Reliance on alleged confessional statements is misplaced as the statements were obtained under coercion, were vague, and were not corroborated by independent evidence.

3.5 Valuation rules were not applied sequentially; Rule 9 was resorted to arbitrarily without exhausting Rules 4 to 8.

3.6 No contemporaneous imports at higher prices were cited despite imports over a four-year period.

3.7 For rotary hooks, reliance on imports by M/s. Singer India Ltd. was improper as the appellants were traders importing low-quality stock lots, operating at a different commercial level.

3.8 Extended limitation under Section 28(4) was not invocable as all these Bills of Entry had been assessed and cleared after scrutiny.

3.9 Past assessments were not challenged, and in view of ITC Ltd. v. CC [2019 (368) ELT