"CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI. PRINCIPAL BENCH, COURT NO. IV CUSTOMS APPEAL NO. 52346 OF 2024 [Arising out of the Order-in-Original No. 07/COMMR/VC/Exclusive Motors/ICD- PPG/2024-25 dated 25/07/2024 passed by Commissioner of Customs, ICD PPG, New Delhi.] M/s Bentley Motors Ltd., Appellant Legal Department FAO Beth Gibson (Wheatley), Pyms Lane, Crewe, Cheshire, CW I 3 PL, England. VERSUS Commissioner of Customs, Respondent ICD PPG, New Delhi. APPEARANCE Shri Sujit Ghosh, Shri Nikhil Varshney, Ms. Rashi Jeph and Ms. Tanya Shukla, Advocates – for the appellant. Shri Rakesh Kumar and Shri Girijesh Kumar, Authorized Representative (DR) – for the Department CORAM: HON’BLE DR. MS. RACHNA GUPTA, MEMBER (JUDICIAL) HON’BLE SHRI P.V. SUBBA RAO, MEMBER (TECHNICAL) FINAL ORDER NO. 51196/2025 DATE OF HEARING : 02.06.2025. DATE OF DECISION : 20.08.2025. P.V. SUBBA RAO M/s Bentley Motors Ltd.1, Crewe, Cheshire, CW I 3 PL, England filed this appeal to assail the order-in-original dated 25.07.20242 passed by the Commissioner of Customs, Inland Container Depot, Patparganj insofar as it imposed penalty of Rs. 20,00,000/- on the appellant under section 112 of the Customs 1. appellant 2. impugned order 2 CUS/52346 OF 2024 Act, 19623. The impugned order decided the proposals made in the show cause notice4 dated 04.08.2023 issued to four noticees including the appellant. The other three noticees were M/s Exclusive Motors P. Ltd., New Delhi5 the dealer of M/s Bentley Motors manufactured by the appellant, Shri Satya Prakash Bagla, Managing Director of Exclusive Motors and Shri Sanket Anand, National Sales Manager of Exclusive Motors. In the impugned order, the Commissioner ordered the value of the cars imported by Exclusive Motors to be adjusted in accordance with Rule 10 (2) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 20076 and consequently confirmed the demand of differential customs duty of Rs. 71,74,43,863/- under section 28 of the Act with interest under section 28AA of the Act. The Commissioner also imposed an amount equal to this differential duty as penalty on Exclusive Motors under section 114A of the Act. He also found that 170 cars imported by Exclusive Motors were liable to confiscation under section 111 (m) of the Act, but did not confiscate them as they had already been cleared and were not available for confiscation and also did not impose any redemption fine in lieu of the confiscation. He imposed penalties on Shri Satya Prakash Bagla under section 112 (a) (ii) and under section 114AA of the Act. Likewise, he also imposed penalties on Shri Sanket Anand under section 112 (a) (ii) and under section 114AA of the Act. 3. Act 4. SCN 5. Exclusive Motors 6. Valuation Rules 3 CUS/52346 OF 2024 2. All four noticees filed appeals assailing the impugned order before this Tribunal. The appeals of the remaining three noticees were allowed by this Tribunal by Final Order No. 59441 – 59443 of 2024 dated 18.11.2024. The details of these appeals are as follows :- (a) Customs Appeal No. 50995 of 2024 - Exclusive Motors (b) Customs Appeal No. 50996 of 2024 – Shri Sanket Anand (c) Customs Appeal No. 50997 of 2024 – Shri Satya Prakash Bagla. This appeal filed by the appellant – M/s Bentley Motors was not listed along with the other appeals and was, therefore, not disposed of along with them. 3. We have heard Shri Sujit Ghosh, assisted by Shri Nikhil Varshney, Ms. Rashi Jeph and Ms. Tanya Shukla, learned counsels for the appellant and Shri Rakesh Kumar and Shri Girijesh Kumar, learned authorized representatives for the Revenue and perused the records. 4. Learned counsel for the appellant submitted that since the appeals of the main noticee Exclusive Motors and the other noticees were already allowed setting aside the impugned order, this appeal filed by the appellant must also be allowed on this ground alone. However, he submits that from a perusal of the Final Order of this Tribunal, it is evident that the appeals of Exclusive Motors, Shri Sanket Anand and Shri Satya Prakash 4 CUS/52346 OF 2024 Bagla were allowed based on incorrect facts in averments made on behalf of the appellants. He submits that M/s Bentley Motors is a multi-national car company and enjoys a very high reputation and, therefore, considers it necessary to point out where false statements were made on behalf of Exclusive Motors and present correct facts. 5. The facts of the case, in brief, are that Exclusive Motors was the dealer and had imported of Bentley Cars into India during the relevant period. The Directorate General of Revenue Intelligence7 developed specific intelligence that it was evading customs duty by undervaluing cars. After conducting a detailed investigation, it was felt that in addition to the price declared in the invoices, Exclusive Motors had made additional payments to M/s Bentley for some cars imported from it. M/s Bentley, the appellant herein, had raised supplementary invoices for which payments were made by Exclusive Motors according to the investigation. It was, therefore, felt that the additional amounts paid for the cars should have been included in the assessable value. Since, Exclusive Motors had not declared this differential amount or the supplementary invoices and thereby evaded payment of duty, the SCN proposed adjusting the value declared by the appellant as per Rule 10 (2) of the Valuation Rules, recover the differential duty invoking extended period of limitation under section 28 (4) along with interest under section 28AA and impose penalties. These proposals in the SCN were 7. DRI 5 CUS/52346 OF 2024 confirmed by the Commissioner through the impugned order. The impugned order was set aside by this Tribunal’s Final Order dated 18.11.2024 in the appeals filed by Exclusive Motors, Shri Sanket Anand and Shri Satya Prakash Bagla. 6. Submissions on behalf of the appellant Learned counsel for the appellant made the following submissions :- (i) The final order dated 18.11.2024 set aside the impugned order in the appeals filed by the three other appellants holding that the declared price is, by default, not only the transaction value but also, unless established to the contrary, the price for delivery at the time and place of importation. The onus for establishing the contrary rests on the adjudicating authority which has not been discharged ; (ii) Therefore in the final order it was held that there were no additional payments which need to be included; (iii) It has been held in the final order that the supplementary invoices on the basis of which the demand was raised were absent in the electronic records of Exclusive Motors Pvt. Ltd. and, therefore, the demand was not correct. (iv) The fact is that the supplementary invoices were issued by the appellant on Exclusive Motors when the cars had to be sent by air, instead of by ship. The price agreed to and mentioned in the original invoice covered the cost, 6 CUS/52346 OF 2024 insurance and freight of the car for delivery by ship. Whenever any car was required to be delivered by air, it involved additional cost and, therefore, supplementary invoices were issued by the appellant to Exclusive Motors. (v) Exclusive Motors denied having received any supplementary invoices which contention was accepted in the Final Order for the reason that the supplementary invoices were not present in the electronic records of Exclusive Motors. The reason the supplementary invoices were not in the electronic records of Exclusive Motors is that as per the arrangement between Bentley and Exclusive Motors, the supplementary invoices are uploaded online by M/s Bentley. Exclusive Motors, as the dealer, had to be access and check all the supplementary invoices. The supplementary invoices were not sent separately by E-mail. This arrangement was mis-represented by Exclusive Motors before this Tribunal to say that no invoices were ever issued. Learned counsel submitted printouts of all the supplementary invoices issued by it and the corresponding airway bills along with a statement (Annexure A-8) with an application seeking permission to place additional documents on record. This statement gives the chassis number, mode of transport details of original invoices and date and date of the supplementary invoice and the airway bill and debit. 7 CUS/52346 OF 2024 (vi) All these invoices were also sent by the appellant to the investigating agency during investigation by E-mail and they were part of the SCN. This Tribunal, in final order dated 18.11.2024, held that reliance on the supplementary invoices was not under the authority of section 108 of the Act before the Gazetted Officer of the Customs and therefore did not consider them. Learned counsel submits that even the original invoices and all documents based on which assessments were made were also not submitted under section 108 of the Act by the appellant. These supplementary invoices have now been submitted by filing a miscellaneous application before this Tribunal which should put them on a better footing then presenting before the Gazetted Officer of Customs and they may be considerd. (vii) In the final order, on the submission of Exclusive Motors, this Tribunal held that there is no record of any additional payment through the banking channels to the supplier (M/s Bentley) towards supplementary invoices or as transfers to alleged adjustment account. Further there was no evidence of any payments being made through Hawala to M/s Bentley. (viii) Learned counsel submitted that the reason there was no separate remittance for the supplementary invoices is that as per their arrangement they had a running account with Exclusive Motors their dealer and all payments towards his supplementary invoices were 8 CUS/52346 OF 2024 made through account adjustment. This was available in their system and it was accessable by both M/s Bentley and by Exclusive Motors. (Learned counsel submitted a printout of the screenshot of the settlement made). Therefore, not only were supplementary invoices raised by the appellant but payments were also received through account adjustment. Therefore, no separate remittance was made by Exclusive Motors which was misrepresented by Exclusive Motors as if no payments were made. (ix) The SCN relied on the values declared by M/s Bentley before the HMRC (UK Customs) and compared them with the values declared in the invoices and in the Bills of Entry by Exclusive Motors. Since HMRC requires values to be declared on FOB terms and the values declared before the HMRC were the same as in the main invoices, the show cause notice proceeded on the premise that the main invoices actually reflected the FOB values and the cost of freight as per the supplementary invoices as well as transit insurance on notional basis needed to be added to arrive at the assessable value. In the Final Order of this Tribunal, it was held that the values declared before HMRC have been accorded undeserving sanctity because they were not values declared for exportation but were merely reporting for statistical purposes – a role played similar 9 CUS/52346 OF 2024 to the Directorate General of Commercial Intelligence and statistics in Government of India. (x) It is true that the values provided to HMRC were for statistical purposes only. The factual position is that the figures which the appellant (M/s Bentley) had reported to HMRC were CIF values for shipment of the cars by ship. Although HMRC requires figures to be reported without including the freight (as observed in the SCN), the figures reported by the appellant were actually CIF values. However, they had not included the additional amounts which were collected through supplementary invoices for sending the cars by air. (xi) The penalty of Rs. 20,00,000/- imposed on the appellant under section 112 (a) (ii) is not correct. Penalty under section 112 is imposable for acts or omissions which render the imported goods liable to confiscation under section 111 or abetting or doing or omitting any such act. The appellant had not done or omitted any such act. The appellant issued proper invoices on CIF basis which were valid for sending the cars by ship. (xii) In those cases, where the cars were to be sent by air, it involved an additional freight amount for which it issued supplementary invoices to Exclusive Motors. (xiii) As an exporter, the appellant had no role whatsoever in the declarations made by Exclusive Motors before Indian Customs. Therefore, by no stretch of imagination the 10 CUS/52346 OF 2024 appellant can be held liable to penalty under section 112 (a) (ii). (xiv) The appeal may be allowed and the impugned order may be set aside insofar as it imposed penalty on the appellant. Submissions of learned authorized representatives. 7. Learned authorized representatives vehemently supported the impugned order and asserted that it calls for no interference as the appellant had issued invoices for a lower value and then issued supplementary invoices which resulted in under valuation of the cars by Exclusive Motors and evasion of duty. Findings 8. We have considered the submissions of both sides and perused the records. 9. The impugned order was issued with respect to the appellant and three others. By Final Order dated 18.11.2024, the appeals of the other three appellants were already allowed. 10. As far as the appellant herein, M/s Bentley Motors is concerned, penalty of Rs. 20,00,000/- has been imposed under section 112 (a) (ii) on the ground that it had abetted mis- declaration value of the cars by Exclusive Motors which rendered such cars liable for confiscation under section 111 (m) of the Act. 11. The impugned order insofar as it pertains to the other three persons including holding the cars imported by Exclusive Motors liable to confiscation under section 111 (m) has already been set 11 CUS/52346 OF 2024 aside by final order dated 18.11.2024. On this ground alone the penalty imposed on M/s Bentley Motors, the appellant herein deserves to be set aside. 12. Even otherwise, if Exclusive Motors had undervalued the goods by reflecting the CIF values in the main invoices without including the additional amounts which it had paid through account adjustment based on the supplementary invoices issued by the appellant, no malafide attributed to the appellant. It cannot be said that M/s Bentley had either acted or omitted any action required of it which rendered the goods liable to confiscation under section 111 (m). In fact, it is evident from the SCN and the impugned order and the documents submitted before us by the learned counsel, that the entire supplementary invoices and the account adjustments were brought-forth by the appellant during investigation. The penalty imposed on it cannot also be sustained even on this ground. 13. The penalty imposed under section 112 (a) (ii) of the Act on M/s Bentley Motors, the appellant, therefore, deserves to be set aside and is set aside. 14. The appeal is, accordingly, allowed. (Order pronounced in open court on 20/08/2025.) (DR. RACHNA GUPTA) MEMBER (JUDICIAL) (P.V. SUBBA RAO) MEMBER (TECHNICAL) PK "