SC rejects Customs’ plea for overvaluation of capital goods imported by Adani

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The Supreme Court rejected the appeal of the customs service Adani Power Maharashtra Ltd. (APML), Adani Power Rajasthan Ltd. (April) and others in alleged overvaluation of imported goods.

A bench consisting of Judges Krishna Murari and Sanjay Karolafter hearing detailed arguments on the matter from both parties, rejected the appeal filed by Customs against APML, APRL and others.

According to counsel familiar with the development, the apex court found that APML and APRL’s project costs were comparable to or less than peers/competitors’ pricing.

Counsel added that the price was below the benchmark per megawatt price set by the Central Electricity Regulatory Commission (CERC) and that the contract was an EPC contract awarded to the lowest bidder after global bidding called International Competitive Bidding (ICB).

According to counsel, the apex court upheld the findings of both the lower authorities, ie the contracting authority and the court of appeal, and confirmed that there was no overvaluation in the importation of capital goods. The Supreme Court on Monday rejected the customs appeal.

APML & APRL according to ICB, Imported goods required for setting up thermal energy projects in Maharashtra and Rajasthan.

The consortium led by PMC Projects (India) pvt. Ltd., which was awarded the contract after ICB, imported goods for erecting transmission line and substation package for Maharashtra Eastern Grid Power Transmission Co. Ltd. (MEGPTCL).

The Directorate of Revenue Intelligence (DRI) issued show cause notices (SCNs) to APML, APRL, MEGPTCL and others in May 2014 for alleged overvaluation of capital goods imports.

DRI’s contracting authority in 2017, the same authority that issued the SCNs after reviewing them in detail, ruled that all imports were genuine and concluded that the declared value is correct and does not need to be redetermined. Later SCNs were dropped.

In 2022, the appeals court rejected the plea of ​​the customs and affirmed that there was no overvaluation in Adani importing the equipment.

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