Customs, Excise and Gold Tribunal - Bangalore
Excel Glasses Ltd. vs Cc on 17 September, 2003
Equivalent citations: 2004(92)ECC763, 2004(166)ELT496(TRI-BANG)
JUDGMENT
K.K. Usha, J. (President)
1. This appeal at the instance of the importer challenges the order dt. 29.12.2000 passed by Commissioner of Customs (Appeals), Chennai. Relevant facts are as follows:
2. M/s. Kopran Ltd., Mumbai placed an order for supply of Soda Ash from one M/s. Quingdas Soda Ash Industrial Co. Ltd. Chennai in the year 1997. The goods were originally shipped on vessel S.S. DASTAR on 31.7.97. Due to adverse climatic condition the vessel was delayed. In the meanwhile, the crew who were not paid their wages got the vessel arrested and took the same to Singapore. The vessel was later sold to another party named 'Sahaj' who brought the cargo to Tuticorin ultimately on 24.7.1998. In view of the undue delay in delivery of the cargo, the original indentor M/s. Kopran Ltd. sold the goods to the appellant on High Seas basis at Rs. 5325 PMT which worked out to 128.31 & PMT at the prevailing exchange rate. The declared value of the appellant was not accepted by the Department who raised the same at $ 158.35 PMT which was the original price in transaction between M/s. Kopran Ltd. and M/s. Quingdas Soda Ash Industrial Co. Ltd., Chennai. Commissioner (Appeals) also took the view that the original price agreed upon in 1997 represented the correct transaction value.
3. The issue raised in the present appeal is whether the transaction value has to be taken as the price at which the goods were sold on high seas basis in 1998 or the price in 1997. It is not disputed that the price of soda ash has come down in the international market during the period from 1997 to 1998. The Commissioner (Appeals) took the view that the provisions contained in Section 14(1) has to be read in harmony with Sub-section (1A) and value shall be determined in accordance with the Customs Valuation Rules. As per Rule 3(1) the value of the imported goods shall be the transaction value and Rule 4(1) provides that the transaction value of imported goods shall be the price actually paid or payable for the goods when sold for export to India adjusted in accordance with the provisions of Rule 9. According to the Commissioner (Appeals) in the instant case originally the transaction was between M/s, Kopran Ltd. and M/s. Qingdao Soda Ash Industrial Co. and this original transaction had all the attributes of a transaction during the course of international trade. Therefore, the price originally paid by M/s. Kopran Ltd. to the overseas supplier has to be taken as the transaction value. Even though the assessee had placed reliance on two decisions of the Tribunal, namely, Sanjay Chandiram v. CC, 1991 (31) ECC 312 (T) : 1991 (52) ELT 413 and Godavari Fertilisers & Chemicals Ltd. v. CC, Visakhapatnam, 1996 (81) ELT 535 the Commissioner took the view that the ratio of those decisions are not applicable to the facts of the case.
4. We heard the Learned Counsel for the assessee and the Learned Departmental Representative. We find merit in the contention raised by the appellant. Section 14(1) of the Customs Act provides that the value of such goods imported shall be deemed to be the price at which such or like goods are ordinarily sold or offered for sale for delivery at the time and place of importation or exportation (emphasis supplied). We find no conflict between the provisions contained under Sub-section (1) of Section 14 and the provisions contained in Sub-section (1A). The price paid by M/s. Kopran Ltd. Mumbai in the year 1997 cannot be treated as the value of the goods imported taking into consideration the requirement under Sub-section (1) of Section 14 that it shall be the price for delivery at the time and place of importation.
5. The Commissioner (Appeals) was not justified in distinguishing the decision of the Tribunal in Godavari Fertilizers & Chemicals Ltd. (supra) the ratio in which was upheld by the Larger Bench in Eternit Everest Ltd. v. CC, Bombay, 2000 (70) ECC 480 (LB) : 2000 (119) ELT 716. The ratio of the above decision was not based on the fact that goods were sold on high seas basis by MMTC. The ratio of the decision was that transaction value which is to be taken into consideration is one between MMTC and the appellant therein since it was that transaction which led to the import. By applying the above ratio, it has to be held that the transaction value of the present case is the price at which the goods were sold on high seas basis to the appellant by M/s. Kopran Ltd. We therefore, set aside the order impugned and allow the appeal.