Customs Dept. Can Reject Declared Bill of Entry Value and Rely on Higher Value Email Invoice for Valuation: CESTAT

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi Bench, has held that customs authorities were justified in rejecting the declared value in one Bill of Entry and re-determining it on the basis of a higher-value invoice retrieved from the importer’s email. The bench of Binu Tamta (Judicial Member) and P.V. Subba Rao (Technical Member) set aside confiscation of goods, annulled most penalties, and quashed demands relating to five past Bills of Entry. The case arose from investigations by the Directorate General of Revenue Intelligence (DRI) into alleged mis-declaration of value and description of imported goods by M/s Shivam Marketing, an Indore-based importer of glass chatons, glass beads, plastic resin and allied items. During an inspection connected to an earlier consignment, the partner of the firm produced a commercial invoice dated 28 January 2015, downloaded from his email, showing a total CIF value of USD 65,884.52 for a container destined for the Inland Container Depot (ICD), Kheda, Madhya Pradesh. However, when the firm later filed Bill of Entry No. 549 dated 5 March 2015 for the same container, it submitted a different invoice dated 26 January 2015, declaring a much higher value of USD 317,479.94 and showing variations in the description and breakup of goods. Taking the view that the lower-value invoice was the true transaction value and that the higher-value invoice was fabricated to mislead customs, the adjudicating authority rejected the declared value under Rule 12 of the Customs Valuation Rules, re-determined the value under Rule 9, confirmed differential duty, ordered confiscation of goods, imposed heavy redemption fines, and levied penalties on both the firm and its partner. Larger Bench clarification on valuation When the appeals first came up before CESTAT, the appellants relied on an earlier coordinate bench decision which had suggested that only the invoice filed with the Bill of Entry could be considered for valuation. Expressing doubt over that proposition, the bench referred the issue to a Larger Bench. The Larger Bench, constituted by the Tribunal’s President, answered the reference in June 2025, holding that even if the importer produces one invoice with the Bill of Entry and another invoice for the same consignment is found in the private records or email of the importer showing a different value, customs duty under Section 14 of the Customs Act can be determined on the basis of the transaction value reflected in the invoice retrieved from the email account of the importer. This ruling became the foundation for deciding the present appeals. The tribunal held that the Commissioner had “reasonable doubt” about the truth and accuracy of the declared value, given the existence of two materially different invoices for the same goods. The rejection of the declared value and re-determination under Rule 9 of the Valuation Rules was therefore upheld. The Tribunal noted that at the time of provisional release, the importer had deposited duty of ₹61.14 lakh, whereas the finally assessed duty worked out to only ₹30.48 lakh. The Commissioner had appropriated the latter from the deposit and dropped the balance demand. The Tribunal found this approach “fair and balanced” and declined to interfere. However, the Tribunal took a different view on confiscation under Section 111(f) of the Customs Act. It clarified that this provision applies only where goods unloaded at a port are not mentioned in the Import General Manifest (IGM) filed by the carrier, and not to disputes about mis-description or valuation by the importer in Bills of Entry. Since the present case concerned conflicting invoices and descriptions rather than non-mention in the IGM, confiscation under Section 111(f) was held unsustainable. Consequently, the redemption fine of ₹25 lakh imposed in lieu of confiscation was also set aside. The department had also sought to re-assess five earlier Bills of Entry on the allegation that glass chatons were mis-declared as glass beads. The Tribunal found that these allegations were based only on statements and were unsupported by corroborative evidence. As the goods had already been cleared, the differential duty demands in respect of these five Bills of Entry were quashed in entirety. Another container, examined after being diverted from ICD Kheda to ICD Muradabad, was confiscated under Sections 111(f) and 111(m) on the ground that the quantity, value and description did not match declarations. The Tribunal observed that in the absence of any specific Bill of Entry being identified for this container, Section 111(m) could not be invoked, and Section 111(f) was also inapplicable for the same reasons as discussed earlier. The confiscation and the ₹1 crore redemption fine were therefore set aside. With confiscation and most duty demands set aside, the Tribunal held that penalties under Section 112(a) on both the firm and its partner could not survive. As regards the penalty of ₹25 lakh imposed on the partner under Section 114AA for using false or fabricated documents, the Tribunal agreed that producing two different invoices for the same consignment demonstrated intentional use of incorrect material. However, considering the overall relief granted to the appellants, the bench reduced this penalty to ₹2 lakh “in the interest of justice”. The Tribunal upheld re-assessment of Bill of Entry No. 549 based on the higher-value invoice found in email. Set aside confiscation of goods and all redemption fines. Quashed differential duty demands relating to five past Bills of Entry. The tribunal set aside penalties under Section 112(a) and reduced the Section 114AA penalty on the partner to Rs. 2 lakh. Both appeals were accordingly disposed of on 17 February 2026. Case Details Case Title: M/s Shivam Marketing Versus Commissioner of Customs, CGST and Central Excise Citation: JURISHOUR-12-CESTAT-2026(Del) Case No.: CUSTOMS APPEAL NO. 51596 OF 2019 Date: 17.02.2026 Counsel For Petitioner: V.K. Puri, Advocate Counsel For Respondent: Ranjan Prakash and Shri Nikhil Mohan Goyal Click Here To Read Order Read More: AIFTP Highlights Technical Glitches, Filing Hurdles on GSTAT Portal

Customs Dept. Can Reject Declared Bill of Entry Value and Rely on Higher Value Email Invoice for Valuation: CESTAT

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