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2014 (8) TMI 220 - CESTAT MUMBAIValuation of goods - related parties / inter-connected undertaking - transaction value with the Oil Marketing Companies (OMC) - Held that:- in case of BCPL [2009 (6) TMI 166 - CESTAT, MUMBAI] it was held that, IPP based price cannot be considered as transaction value as it was an artificially fixed notional value. In such an agreement, price was definitely not the sole consideration for sale. It is based on this reasoning, it was held in the BPCL case that sale price to OMC cannot be accepted as sole consideration for sale. - Decision of BCPL case in not applicable in the present situation. However, we find that the reasoning adopted is flawed as Import Parity Price is not an artificially fixed price. It is an actual price at the time and place of import which is also place for the sales effected by the Refinery or OMC to another OMC. To say that such a price is an artificially fixed notional value is completely contrary to facts. Import price cannot be influenced by the marketing companies situated in India. Therefore, there is a major flaw in the reasoning adopted in the order relied upon by the Revenue - import price agreed between one OMC and another based on the MOU reached between them can be considered as a transaction value and such a finding was also be upheld in the case of HPCL [2005 (2) TMI 357 - CESTAT, BANGALORE] - Decided against Revenue.
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