ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 09.06.2025
CESTAT New Delhi Rejects DRI’s Undervaluation Claim
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has set aside the order of the Commissioner of Customs (Adjudication) that confirmed undervaluation and duty evasion charges against M/s EDAG Technologies India Pvt. Ltd. and its foreign parent EDAG Germany, along with its officials.
The Tribunal categorically held that there was no additional consideration paid for the imported goods and no legal basis for rejecting the declared transaction value under the Customs Valuation Rules, 1988.
Case Background
- Turnkey Contract: EDAG India entered a βΉ22.21 crore turnkey project with Ford India to set up a plant in Chennai, with 49% as import content.
- Allegation: Directorate of Revenue Intelligence (DRI) alleged that EDAG undervalued imports by βΉ6.97 crore, supported by a cancelled invoice of β¬1 million from EDAG Germany.
- Action Taken: A detailed SCN was issued in 2009 followed by a common adjudication in 2010, resulting in demands for differential duty, interest, confiscation of goods, and personal penalties.
This Article has been written by Shri Ravi Shekhar Jha, Advocate Delhi High Court based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
Source: CESTAT New Delhi
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