Custom, Excise & Service Tax Tribunal
M/S. Dalmia Cement (Bharat) Ltd vs Commissioner Of Customs, Chennai on 14 December, 2010
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. C/280/2004
(Arising out of Order-in-Appeal C. Cus. No.265/2004 dated 31.3.2004 passed by the Commissioner of Customs (Appeals), Chennai)
M/s. Dalmia Cement (Bharat) Ltd. Appellants
Vs.
Commissioner of Customs, Chennai Respondent
Appearance Shri S. Murugappan, Advocate for the Appellants Ms. Indira Sisupal, JDR for the Respondent CORAM Honble Dr. Chittaranjan Satapathy, Technical Member Date of Hearing: 14.12.2010 Date of Decision: 14.12.2010 Final Order No. ____________ Heard both sides.
2. The appellants placed a purchase order with M/s. FAG, a bearing manufacturer of a known brand in Germany for one bearing of No. QJ 1252 MPA (QJ 1252 MA) and two bearings of No. NU 2252 E.M1A (NU 2252 C NA) for a unit price of 2525.77 EURO and 1912.37 EURO respectively totaling 6350.51 EURO for all the three bearings. The price was for CIF, Chennai Seaport, but the consignment came by air because of urgency. The purchase order dated 17.1.2003 is at page 15 of the appeal papers. It is the case of the appellants that the supplier in Germany supplied all the three bearings under a single Invoice No. 0038078598 dated 3.7.2003 which indicates a total price of 6350.51 EURO and which tallies with the price indicated on the purchase order. However, the invoice makes adjustments by deducting the sea freight charges and adding the air freight charges as the consignment was actually shipped not by sea but by air. The total price indicated on the invoice which is at pages 20 to 22 of the appeal papers is the adjusted price of 6626.45 EURO. The appellants filed a Bill of Entry No. 553870 dated 8.7.2003 along with the invoice No. 0038078578 dated 3.7.2003. The invoice amount was indicated in the Bill of Entry as 6191.75 EURO plus miscellaneous charges 434.70 EURO totaling to 6626.45 EURO. The appellants have paid duty on the total value for three bearings but the clearance under the said Bill of Entry was sought for only one package which arrived under airway HAWB No.60072655 dated 4.7.2003. Weight was indicated only as 25 kgs. apparently by mistake though the actual weight should have been indicated as 84 kgs. as per the individual weights given on the invoice for the three bearings. The assessing officers have assessed and collected the entire duty amount as per the invoice even though only one package was received against the invoice for three packages of three bearings. It is the case of the appellants that they received the remaining two bearings under HAWB No. 60073661 dated 12.7.2003 of a weight 238 kgs. and filed a Bill of Entry No. 557536 dated 18.7.2003 for two packages. The appellants submitted the very same invoice No. 380785938 dated 3.7.2003 on the basis of which the first Bill of Entry dated 8.7.2003 was earlier assessed. This time, however, they indicated proportionate value of 3729.12 EURO plus 289.80 EURO for the two bearings contained in two packages and they have paid duty accordingly as assessed by the appraising officer. It is the case of the appellants that though they have imported only three bearings under the same invoice they have paid duty twice first for three bearings and again for two bearings and they are entitled to refund of proportionate amount paid in excess for two bearings against the first Bill of Entry. The claim of the appellants has been rejected by the authorities below, leading to this appeal.
3. When the appeal was heard earlier on 25.10.2010, the learned counsel for the appellants was directed to obtain and produce a clarification as to how the bearings were shipped separately under two airway bills whereas the invoice was only one and the purchase order was also only one. The appellants have since obtained a clarification from the supplier M/s. FAG in Germany and submitted the same at the time of hearing today. The clarification dated 13.12.2010 reads as follows:-
Dear Sirs, Fle: Shipment of Bearings against your Order No. DP/PO/MP/VNK/3249/2003 dt. 17.1.2003 This is to inform you that the entire ordered quantity of 3 bearings was handed over to our Forwarder M&M Cargo to be airlifted to Chennai in one lot. Out of 3 cases, only one case was air freighted in the first shipment as due to bad weather the Airlines were forced to off load few consignments from the aircraft and your two cases were detained at the Airport which were shipped subsequently as detailed below:-
Shipment Type of Bearing Qty.
AWB No. Invoice No. I QJ 1252 MPA 1 JAM 60072655 4.7.03 0038078598 / 3.7.03 II NU 2252 EM1A 2 JAM 60073661
- do -
Both the shipments were covered by the same invoice. Yours faithfully, Schaeffler Technologies GmbH & Co. KG
4. The clarification as above explains that due to bad weather only one out of the three cases could be air freighted in the first shipment and the rest two cases were shipped subsequently, details of which have been given. The airway bill numbers indicated in the clarification tally with the airway bill numbers which were indicated by the appellants in the respective Bills of Entry filed with the customs authorities.
5. The learned DR appearing for the Department supports the impugned order and states that since the shortage in the first instance was not noted in the examination report, no refund is permissible. Unfortunately, the examination reports which might have been recorded on the respective Bills of Entry are not available as the matter pertains to the year 2003. Normally no refund should be allowed unless the shortage is recorded in the presence of customs officials and before the out of charge from customs control is given. However, the fact that only one package was imported under the first Bill of Entry in this case is clear from the details furnished in the Bill of Entry itself whereas the accompanying invoice indicated three packages. The claim of the appellants is also supported by all the attendant details given in the respective Bills of Entry, the airway bills, the invoice and the packing list apart from the clarification obtained by the appellants from the supplier as directed by the Bench. It is also seen that even though the appellants had produced the very same invoice along with the second Bill of Entry, the appraising officer has also raised no dispute and has accepted proportionate value for assessment for only two packages which goes to show that customs authorities have accepted that the second consignment is covered by the same invoice. Hence, it is evident that the appellants have imported the three bearings under two airway bills but against only one invoice and have paid duty for the same under two respective Bills of Entry as indicated above. It is also evident from the record that in the first instance they have paid excess duty for two packages which were imported only later on as the assessing officer took the entire invoiced value for three bearings for duty assessment on one bearing imported initially though part of the consignment was not shipped due to bad weather as explained by the supplier. In the peculiar facts and circumstances of this case and considering the documentary evidence available, in the interest of justice, it is felt that the appellants should not be denied refund of duty paid in excess against the first Bill of Entry. As such, the impugned orders passed by the authorities below are set aside and the appeal is allowed with consequential benefit to the appellants.
(Dictated and pronounced in open court) (Dr. Chittaranjan Satapathy) Technical Member Rex ??
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