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Issues: Valuation of imported Ethylene-Di-Chloride (EDC) - Rejection of transaction values by Customs authorities - Assessment of customs duty based on higher values - Contention of regular importer negotiating lower prices - Commercial prices vs. contemporaneous transaction values - Justification for rejecting transaction value - Appeal outcome.
The judgment by the Appellate Tribunal CESTAT, New Delhi, dealt with the valuation of imported Ethylene-Di-Chloride (EDC) and the rejection of transaction values by the Customs authorities for two imports. The Customs authorities had increased the import prices set by the appellants for assessment purposes, citing higher values from another importer for the same product. The appellants argued that as regular importers, they had the capacity to negotiate lower prices, especially considering the fluctuating international prices of petroleum-based products like EDC. They presented a detailed price chart spanning from 1998 to 2003 to illustrate the significant price variations in the market. The appellants contended that the prices at which they imported the goods were commercial prices and should have been accepted for assessment. They emphasized that each import should be assessed based on its own transaction value, and the prices set by other parties should not be a reason for rejecting a transaction value. The Tribunal noted that there was no evidence to doubt the appellant's transaction value, and the rejection was solely based on the fact that another importer had higher prices. The Tribunal emphasized that contemporaneous transaction values could differ due to various commercial reasons, and rejecting a transaction value based on this was unjustified. Consequently, the Tribunal set aside the impugned orders, allowing the appeals and providing consequential relief to the appellants if applicable.
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