Valuation Checking Cell — Creation of, in each Customs
House to check under-valuation of sensitive commodities
Circular No. 27/2002-Cus. V, dated 21-5-2002
F. No. 467/72/2001-Cus. V
Government of India
Ministry of Finance (Department of Revenue)
Central Board of Excise & Customs, New Delhi
Subject : Creation of Valuation Checking Cell in each
Customs House regarding
Attention is drawn to the Joint Secretary (Customs)’s D.O.
letter of even number dated 25th September, 2001 (copy enclosed for ready
reference) on the subject mentioned above. In the enclosed D.O. letter, all the
field formations were requested to create a ‘Separate Valuation
Checking Cell’ unit in each Customs House comprising officers of Appraiser
rank to keep a check on under-valuation of sensitive commodities.
In view of above, I am directed to say that all the
formations shall create a “Separate Valuation Checking Cell” in each Customs
House if not already done and initiate necessary action to review the
undervalued consignments so that remedial action is promptly taken. The
Valuation Cell will ensure the use of NIDB data by the assessing officers while
assessing live consignments. The Cell will compile the data called for in
Chairman’s D.O. letter dated 27-12-2001 (copy enclosed for ready reference) and
forward it to the jurisdictional Chief Commissioner, so that the aggregate Zonal
Data can be sent to the Directorate of Valuation by 7th day of every succeeding
month.
All the field formations are requested to take necessary
action as desired and send a report to the Directorate of Valuation with a copy
to the Board for information.
ANNEXURE I
Copy of letter D.O.F. No. 467/72/2001-Cus. V., dated
25-9-2001
May I invite your attention to my D.O. letter of even
number, dated 6-8-2001, wherein it was conveyed that in the revenue meetings
taken by Secretary (R), the nature of checks on declared values being made by
our officers had been discussed at length. It was mentioned in the letter that
Customs Officers assessing imported goods should make intensive use of the
valuation data circulated by the Directorate of Valuation as well as such data
which is stored in the Customs computers. In this regard, detailed instructions
had also been issued earlier in the Member (Cus.)’s D.O. letter of even no.
dated 17-1-2001 and during his visit to Mumbai Customs which were summed up in
the tour note circulated to all Commissioners of Customs.
The need for 2. stricter check on valuation to stop leakage
has been engaging special attention of FM and this issue was further discussed
in the weekly meeting taken by Secretary (R) recently. It has been felt that
there is scope to augment Customs revenue considerably by taking recourse to
further measures to check under-invoicing effectively. It is very necessary that
Asstt./Dy. Commissioner incharge of various Appraising Groups ensure careful
checking of declared prices with contemporaneous price data of imports effected
from different centres and that collected from various other sources. Board
feels that apart from this scrutiny there should be an arrangement in every
Custom House for an independent further check on prices being declared and
accepted specially for sensitive commodities to guard against any consignments
involving considerable under-declaration getting assessed based upon declared
prices due to volume of work or lack of proper checks etc. in the assessment
group. It has, therefore, been decided that a separate valuation checking cell
may be created in each Custom House comprising of two officers of Appraiser’s
rank. This cell should be fully equipped with valuation data provided by
Directorate of Valuation as well as the data bank stored in the computer systems
etc. The cell should have experienced officers, well versed about the prices of
goods, and the sources for ascertaining reliable international prices. In the
four major Custom Houses at Mumbai, Delhi, Kolkata and Chennai, this cell may be
attached to Special Valuation Branch. In the remaining Custom Houses this may
function under the supervision of any Addl./Jt. Commissioner, and should report
every day results of checks carried out to Commissioner.
The proposed 3. valuation cell will have to be provided
with appropriate computer terminal(s) so that they have simultaneous access to
the Bills of Entry data which are being presented to any group whether already
assessed or in the process of assessment. The officer in the cell should watch
carefully the values of goods being declared especially for those commodities
which are sensitive from the point of view of valuation. By making proper use of
the valuation data furnished by DOV, that is already in the computer system for
contemporaneous imports, etc., the cell is expected to identify consignments
where prices declared are prima facie questionable having due regard to
information for identical/similar goods prices etc. If the assessment has
already been done immediate further steps for reviewing the values &
demanding differential duty by way of issue of SCN etc. has to be initiated.
Otherwise, remedial steps for loading of value before finalising assessment by
the group should be taken to protect the interest of revenue.
The Ministry is also 4. of the view that one terminal
should be provided to the DRI office at the same station as the Custom House so
that the DRI officers can also maintain a watch on the ongoing process of
assessment from valuation angle etc.
You are requested to 5. ask your officers to contact
concerned officials of the Directorate of Systems and get a “Read Only” terminal
which will have access to all the Bills of Entry being assessed in the Custom
Houses. Similarly, arrangements may be made for extending one such terminal to
the DRI office.
I shall be thankful 6. if feedback about action taken in
the matter could be sent to the Board on immediate basis.
Yours Sincerely,
Sd/-
(P.C. JHA)
ANNEXURE II
Copy of letter D.O.F. No. 467/83/2000-Cus. V(Pt.) Vol. VI,
dated 27-12-2001
Attention is invited to Board’s letter of even number dated
27-8-2001, wherein the format and time frame for report prescribed for under
valuation of sensitive commodities was revised. It has been decided at the level
of Chairman (CBEC) that henceforth the report should be sent by the Chief
Commissioners to the Commissioner, Directorate of Valuation by the 7th of the
succeeding month. The DOV, in turn, will compile/analyse the data and send a
brief note to the Board on the amount of revenue realised by way of loading of
valuation, by the 15th of succeeding month for which the report is due.
It is noticed that 2. despite emphasis laid on the report,
the same is either not being sent on time or is sent after considerable time
lapse. The time frame should be strictly adhered to and the report should be
sent in the prescribed format with all the columns duly filled. The Board
intends to keep the Government informed of the amount of revenue realised as a
result of efforts made by the Department to curb under-valuation. In view of
importance of the matter, I would request you to kindly ensure timely submission
of the report to the Directorate of Valuation.
Yours Sincerely,
Sd/- (K.L. Verma)