Order-in-revision: Valuation Ruling No.1216/2017 remanded back for re-determination

KARACHI: Directorate General of Customs Valuation has remanded the Valuation Ruling No.1216/2017 with directives to conduct comprehensive valuation exercise for the determination of the customs values of soap noodles addressing the infirmities in the said ruling.

A number of soap importers had approached Director General agitating against the Valuation Ruling No.1216/2017 that Directorate of Customs Valuation Karachi had fixed the values of the goods in violation of Section 25 of the Act 1969 and Customs Rules, 2001, which was causing serious harm and loss to the importers as well the local soap noodles market.

After due process, Director General observed the methodology adopted by the department while issuing the impugned ruling is lacking in material aspects. The ruling refers to obtaining online information of subject goods to determine the Customs values of noodles whereas the record reflects that as independent sources. Only ICIS scan was consulted by the department which publishes the prices of soap noodles as a commodity. How the commodity for valuation purposes was subdivided into further categories as notified vide the impugned valuation ruling and how the price parity between these categories was ascertained could not be logically explained with support of facts.

The reason for notifying absolute values without first identifying the price parity is also not clear. Further the clearance data and the comments thereto point towards the fact that the importers are declaring vague descriptions and getting their standard noodles mixed with lumps and are clearing in the lowest slab of valuation.

The description as given in the declarations made by the petitioners also reflects the same ambiguity. Therefore, the case is remanded to the Director, Customs Valuation, Karachi. to conduct comprehensive valuation exercise for the determination of Customs values of soap noodles, in accordance with law, addressing the infirmities of the impugned Valuation Ruling and notify the same under Section 25A of the Customs Act, 1969.

It is further advised that views of clearance Collectorates may also be obtained and their representatives may be included in the meetings and proceedings.

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