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2023 (4) TMI 669 - AT - CustomsFinal assessment of bills of entry - Reduction in price after negotiation - import of Steam (Non-coking) Coal in bulk - re-negotiation of price by parties (at lower side, as the coal supplied by the exporter was not as per the quality standards specified in the purchase order) - whether the final assessment of imported Coal should have been done as per the reduced price US$ 86 PMT re-negotiated by the parties to the contract after completion of imports in question? - HELD THAT:- In light of the statutory provisions, the factum of actual payment of the price in terms of the contract/ agreement cannot be ignored while determining the value of the goods under Section 14 of the Act. Further the fact are not disputed in this matter that in respect of the quality of coal consignment actually arrived in India was different. In support of this, appellant also produced the analysis report. We also observed that disputed price adjustment is due to quality and rejection clause mentioned in the purchase agreement. As per the purchase agreement dtd. 22.08.2008, the price originally decided for the coal having the specified quality standards. However the quality analysis report clearly held that the coal supplied does not fulfil the specification as laid down in the purchase order. The said fact nowhere disputed by the revenue in the present matter. We may, however, hasten to add that in such a situation the genuineness and the necessity of reduction in the price are required to be scrutinised very carefully. In the instant case, the Ld. Commissioner (appeals) has not examined the genuineness of the price reduction, and has proceeded to reject the appeal of the appellant. It is, however, added that the Commissioner (Appeals) did properly examine the cogency of the reasons for price reduction though he was not convinced to accept the same. Thus, if there was a genuine cause for reduction in the price of the imported goods and the seller was also convinced that there is need for reduction in the price earlier agreed and accordingly accepted the lower price negotiated between the seller and the importer. Section 14 of the Customs Act, 1962 also talks of the price which is either paid or payable to the seller. In such situation it will be improper if importer is asked to pay customs duty on an amount more than what was the consideration for the transaction. The actual transaction value paid is required to be accepted for assessment purpose, particularly when the genuineness of the reduction is not under dispute. The assessment authority needs to examine the matter afresh. Accordingly, the appeal is allowed; the impugned order is set aside, and the matter is remitted back to the original authority for fresh consideration, particularly in relation to the verifying genuineness of transaction of appellant and foreign supplier and their payment particulars, agreement, purchase order, invoice, quality inspection reports, actual transaction value etc. related to the disputed transactions - appeal allowed by way of remand.
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