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2023 (11) TMI 379 - AT - Customs


Issues involved: Whether demurrage charges should be included in the assessable value of imported "Steam Coal".

Summary:

The issue in this case was whether demurrage charges paid by the appellant should be included in the assessable value of imported "Steam Coal". The appellant argued that based on the decision of the Hon'ble Orissa High Court and CESTAT New Delhi, demurrage charges should not be included in the assessable value. The Revenue, on the other hand, reiterated the findings of the impugned order and mentioned that an appeal against the Orissa High Court judgment was pending before the Hon'ble Supreme Court.

Upon careful consideration, the Tribunal referred to the Orissa High Court judgment in the case of TATA Steel Ltd., which held that demurrage charges cannot be included for the purpose of valuation under the Customs Act, 1962. The Tribunal also noted the decision of the Delhi bench of the Tribunal in the case of Vinyl Chemicals (India) Ltd., which followed the Orissa High Court judgment and held the explanation of Rule 10(2)(a) of the Customs Valuation Rules, 2007 to be ultra vires Section 14 of the Customs Act. Therefore, the Tribunal concluded that demurrage charges are not includable in the custom valuation of imported goods for the purpose of charging custom duty.

Regarding the pendency of the revenue's appeal against the Orissa High Court judgment, the Tribunal observed that no stay had been granted by the Hon'ble Supreme Court, thus the finding of the High Court judgment was in force. Consequently, the impugned order was set aside, and the appeal was allowed.

The judgment was pronounced in the open court on 06.11.2023.

 

 

 

 

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