SC Junks Review plea by Customs on Alleged Overvaluation in Import of Capital Goods by Adani Firms

The Supreme Court has dismissed a review plea filed by the customs department against Adani Power Maharashtra Limited (APML), Adani Power Rajasthan Limited (APRL) and others in a case pertaining to alleged overvaluation of imported goods.

A bench of Chief Justice D Y Chandrachud and Justice Sanjay Karol said there was no error apparent on the face of the record.

“Having perused the review petitions, there is no error apparent on the face of the record. No case for review under Order XLVII Rule 1 of the Supreme Court Rules 2013 has been made out. The review petitions are, therefore, dismissed,” the bench said.

The top court was hearing a review petition filed by the customs department challenging the March 27, 2023 order of the apex court dismissing its plea.

“We have heard Balbir Singh, Additional Solicitor General appearing for the appellant(s), and Mukul Rohatgi, senior counsel appearing for the respondents, at length. We are of the considered opinion that the matters are concluded by the findings of fact recorded by the authorities below and the impugned order(s) does not require any interference at our behest. The appeals accordingly stand dismissed,” a bench comprising Justices Krishna Murari and Sanjay Karol had noted in its order.

According to a lawyer associated with the case, the court had found that the project cost of APML and APRL was either similar or lower than the price of their competitors.

He said the price was lower than the benchmark per-megawatt cost fixed by the Central Electricity Regulatory Commission (CERC) and the EPC (Engineering, Procurement, and Construction) contract was awarded to the lowest bidder following a worldwide bidding process called International Competitive Bidding (ICB).

The top court had upheld the findings of both the lower authorities — the adjudicating authority as well as the appellate tribunal — and confirmed that there was no overvaluation in the import of capital goods.

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The Adani firms had imported goods required to set up thermal power projects in Maharashtra and Rajasthan.

Likewise, a consortium led by PMC Projects (India) Private Limited, which was awarded the contract after International Competitive Bidding, had imported goods to set up transmission lines and a sub-station package for Maharashtra Eastern Grid Power Transmission Company Limited (MEGPTCL).

The Directorate of Revenue Intelligence (DRI) had in May 2014 issued show-cause notices to the firms and others alleging overvaluation in the import of capital goods.

The adjudicating authority of the DRI, which had earlier issued the show-cause notices, held in 2017 that all imports made by them were genuine and concluded that the value declared was correct and did not require to be redetermined. Subsequently, the notices were dropped.

In 2022, the appellate tribunal dismissed the customs department’s plea and confirmed that there was no overvaluation when the equipment were imported by the Adani firms.

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