Custom, Excise & Service Tax Tribunal
M/S. Dailmer Chrysler India Pvt. Ltd vs Commissioner Of Customs, New Delhi on 28 August, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. Appeal No. C/1206/2004-Mum. (Arising out of Order-in-Appeal No. CC(A)/207/Cargo Export/D-1/2004 dt. 30.9.2004 passed by the Commissioner of Customs (Appeals) Delhi ) For approval and signature: Honble Mr. P.S.Pruthi, Member (Technical) Honble Mr. Ramesh Nair, Member (Judicial) ============================================================
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
=============================================================
M/s. Dailmer Chrysler India Pvt. Ltd.
:
Appellant
VS
Commissioner of Customs, New Delhi
:
Respondent
Appearance
Shri T.Viswanathan, Advocate for Appellant
Shri Chatru Singh, Assistant Commissioner (A.R) for respondent
CORAM:
Mr. P.S.Pruthi, Member (Technical)
Mr. Ramesh Nair, Member (Judicial)
Date of hearing : 28/08/2015
Date of decision : 11/09/2015
ORDER NO.
Per : P.S. Pruthi
This appeal is directed against the impugned Order-in-Appeal dt. 30.9.2004 passed by the Commissioner (Appeals).
2. The parent company of the appellant M/s. Daimler Chrysler AG, Germany had imported three cars into India against an ATA Carnet for the purpose of exhibition at Auto Expo. After exhibition, they obtained permission to sell the cars to the appellant from the Government on 9.4.2002. Bills of Entry No.86, 87 & 88 all dated 20.5.2002 were filed. The value declared on the Bills of Entry was substantially lower than that on the Carnet document. The adjudicating authority ordered the assessable value to be taken as Carnet price + Insurance +Freight + Landing Charges. Before the Commissioner (Appeals) the appellant also pleaded that since their case is under investigation by SVB Mumbai in respect of other cars imported, the lower authority ought to have permitted provisional clearance after acceptance of 1% Revenue deposit. However their pleas were rejected and the Commissioner upheld the order of the adjudicating authority.
3. Heard both sides.
4. The plea of the Ld. Advocate is that the Carnet Form which is submitted under the Bill of Entry and Shipping Bill Regulations 1990 provides for declaration of value which is the commercial value in the country of issue. He also submitted that during the same period the cars imported by them on regular basis were assessed provisionally and they had paid 1% Revenue Deposit. He referred to regular imports of same three models of cars imported under specific Bills of Entry around the same time when the cars were imported under the Carnet, at the lower prices as compared to values mentioned in the Carnet. The values declared in the Bills of Entry in respect of cars imported under Carnet at the time of sale of such cars corresponded to values declared in the regular imports.
4.1. Ld. Counsel also stated that the SVB Order dt. 27.1.2005 in the case of the appellant held that the relationship between the importer and their Principal had not influenced the price and the declared prices were accepted. The said order was reviewed vide orders dt. 21.2.2008, 25.2.2011 and 11.2.2015 and the operation of the order dt. 27.1.2005 was continued.
5. The Ld. AR appearing for Revenue reiterated the findings of the lower authorities. He stated that in terms of the valuation provisions the declared value as on the Carnet has to be accepted.
6. We have carefully considered the facts of the case and submissions made by both sides.
7. We find that goods imported under ATA Caret are allowed duty free in terms of Notification No. 157/90-Cus dated 28.3.1990. Normally, the goods have to be exported within six months. But during the relevant time sale of such goods was permitted on payment of Customs duty with prior approval of the Government of India. This permission was obtained by the appellant who had bought the cars from M/s. Daimler Chrysler AG, Germany who initially imported the cars under ATA Carnet. The question which arises is what value is to be taken for purposes of assessment to duty on the sale of the cars. The department has relied on the value declared in the Carnet. But the Carnet Form, which acts as a substitute for Bill of Entry at the time of import under Carnet, clearly states that the value declared in the form is the commercial value in the country of its issue. The value in the country of exportation is required to be declared for purposes of insurance and for purposes of Bank Guarantee which is submitted by the exporter to the Automobile Association which in turn guarantees the re-import of the car. In this particular case when import of identical cars have been made at lower values which are comparable to the value declared at the time of filing Bill of Entry for sale of the cars imported under Carnet, there is no justification to take the higher value mentioned in the Carnet. The appellant gave specific Bills of Entry Nos. 543752, 544155, 510318 under which contemporaneous imports were made. Even though the contemporaneous imports were assessed to duty on provisional basis as the valuation of the cars was being examined by Special Valuation Branch (SVB), Mumbai, the lower authorities ignored this aspect and did not allow the provisional assessment on similar basis in the case of the cars imported under Carnet. In any case it is shown by the Ld. Advocate that the SVB order did not establish that the value between appellant and their Principal had influenced the price and had consequently accepted the declared prices. Therefore, we find no reason to differentiate between the cars imported under Carnet and the cars imported otherwise.
8. Looking at the case from the aspect of Valuation Law also, we cannot agree with Revenue. Valuation under Section 14 clearly provides that the value shall be the transaction value where the buyer and seller are not related. In the present case even though buyer and seller are related it is established by the SVB order that the price has not influenced the relationship. Therefore, the transaction value cannot be rejected. Revenue rejected the transaction value on the basis that the value declared in the Carnet is much higher. We find that Rule 8(2)(iii) of the Valuation Rules which provides for residual method of determining the value clearly states that no value shall be determined on the basis of the price of the goods on the domestic market of the country of exportation. In the present case the Carnet Form clearly declares the value to be commercial value in the country of its issue, which is Germany in the present case. Therefore, it is clear that the Carnet value does not constitute assessable value under Section 14 of the Customs Act. In view of the above reasons, the impugned order is not sustainable therefore set aside.
Appeal allowed.
(Pronounced in court on 11/09/2015) (Ramesh Nair) Member (Judicial) (P.S.Pruthi) Member (Technical) SM.
6Appeal No. C/1206/2004-Mum.