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2020 ] RBT EXPORTS PVT. LTD. v. COMMISSIONER OF CUSTOMS (PORT), KOLKATA 259

be effective without any drawback benefit subject to the payment of penalty as
has been ordered.
4. Being aggrieved by the impugned order the appellants have filed the
present appeals.
5. Learned Advocate appearing on behalf of the appellants submitted
that the impugned order is not correct as that the appellants have not violated
the provisions of Customs Act, 1962 (for short “Customs Act”) in order to avail
undue duty drawback benefit. The department has not produced any evidence to
establish that the appellant has made gross misdeclaration of value of the export
goods. It is also submitted by the Learned Advocate that just by mentioning that
the party has not produced the required documents, the allegation of overinvoic-
ing cannot be established, as the ‘Burden of Proof’ lies with the department.
6. Learned Advocate has relied upon the decision of M/s. Peerless Con-
sultancy Services Private Limited v. Commissioner of Customs (PORT), Kolkata; [2013
(291) E.L.T. 201 (Tri.-Kolkata)], wherein it is held that the burden of proof is on
the department regarding overvaluation in absence of flow back of payment
made to the merchant-exporters. It is, further, submitted that all the documents
including the procurement invoices have been seized by the DRI and therefore,
they were not in a position to provide the procurement invoices in respect of the
export consignment. In addition, some of the documents got burnt, for which FIR
has been filed before the police. In such a situation it cannot be alleged that the
appellant has not produced document deliberately.
7. Learned Advocate also, submits that the department has not been
able to provide any information regarding overvaluation. The value declared by
the appellant has been rejected merely on the basis of report from Council of Sci-
entific and Industrial Research-Central Leather Research Institute (CSIR-CLRI),
who is not empowered to decide the value of the export consignment. The CLRI
is only concerned with the technical evaluation of the leather goods, with respect
of composition of the material and quality of the leather used. Therefore, the cost
price obtained from the CLRI is of no consequence. It is also submitted that the
valuation of the export consignment needs to be done under the provisions of
Section 14 of the Customs Act, read with Customs Valuation (Determination of
Value of Export Goods) Rules, 2007 (for short ‘Export Valuation Rules’) which
has not been followed in this case.
8. Learned Advocate also submits that the appellant has not prepared
any forged invoices or any incorrect document in respect of export consignment
and therefore, they are not liable for penalty under Section 114AA of the Cus-
toms Act, 1962.
9. Similarly, it is the submission of the Learned Advocate that the ap-
pellant has not violated any of the provisions of the Foreign Trade (Development
and Regulation) Act, 1992 and thus no penalty is imposable under the FT (DR)
Act as well.
10. Learned Advocate further submitted that in the impugned order
the adjudicating authority has not followed the ‘Export Valuation Rules’ which
mandated for sequential application of the Rules and directly travelled to Rule 6,
ignoring the provisions of Rules 4 and 5. The Rules 4 to 8 of the Customs Valua-
tion Rules require market inquiry to be conducted as a last resort. Reliance was
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