Whether assessment for export duty shall be on the basis of discharge port analysis or load port analysis?

PJ-Case law-2012/13-1566

Case:- THE COMMISSIONER OF CUSTOMS, BANGLORE V/s CARTRONICS PVT. LTD.

Citation: - 2013 (291)-E.L.T. 572 (Tri.-Bang.)

Brief facts: - The facts of the case in brief are that the M/s V.G.M. Exports a consignment of iron ore to M/s kanematsu ltd., Hong Kong vide shipping bill and declared the value of US$ 2577850 (FOB) and paid export duty on this value. The shipping bill was assessed provisionally and duty was also paid provisionally. Subsequently, the assessment was finalized under section 18(2) of the customs act, 1962 and additional duty demand of Rs. 942305 /- was confirmed against the appellant on the ground that duty liability is to be discharged on the basis of load port analysis. The respondent preferred an appeal before the lower appellate authority, who directed the adjudicating authority to finalize assessment on the basis of final invoices and the bank realization certificate. It is against this order, the revenue is before us.

Appellant Contention: - The contention of revenue is that value has to be arrived at on the basis of load port analysis and not the discharge port analysis. The learned Dy. Commissioner (AR) appearing for the revenue reiterates the grounds of appeal stated in the appeal memorandum.

Respondent Contention:- The learned counsel for the respondent submits that they have discharged the export duty liability on the basis of final invoice price, which is charged from the foreign buyer , which is the transaction value under section 14 of the of the customs act, 1962 and , therefore, the demand is not sustainable.

Reasoning of Judgment: After considering the facts and records of the case, it was held that section 14 of the customs act, 1962 stipulates that for the purpose of the customs tariff act,” the value of the exported goods shall be the transaction value of such goods, that is to say, the price actually paid or payable for the goods when sold for export from India for delivery at the time and place of exportation, where the buyer and seller of the goods are not related and price is the sole consideration for the sale.” It is not the case of department that the buyer and seller are related . It is also not a case of the department that the respondent has realized any amount more than what is indicated in the final invoice price, which has been received by them through the bank. In other words, the price actually paid for the goods exported was the price realized by them as per the final invoice and as per the bank certificate and that is the transaction value on which duty liability has to be discharged. Therefore, we do not find any merit in the appeal filed by the revenue and accordingly, the same is dismissed.

Decision:- Appeal dismissed

Comment: - The analogy drawn from this case is that the export duty is paid on the basis of discharge port analysis (i.e. duty assessment is done on the basis of final invoices and bank realization Certificate) and not on the basis of load port analysis and this is concluded after perusing the definition of transaction value given in the Customs Act.

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PJ-Case law-2012/13-1566

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