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2016 (10) TMI 126 - SC - Indian LawsValuation - whether customs duty is to be added to the value of goods for the purpose of payment of octroi under Bombay Municipal Corporation (Levy of Octroi) Rules, 1965 - import of certain computer parts and claimed exemption from payment of customs duty thereupon invoking the provisions of Notification No. 133 of 1994 dated 22.06.1994 - Held that:- from the reading of Rule 2(7)(a), it becomes clear that for ascertaining the value of the goods not only the original invoice but certain other charges like shipping dues, insurance, custom duty, excise duty, countervailing duty etc. are also includible in the value of articles if such charges are, in fact, incurred by the assessee or even “liable to be incurred by the importer”. It was the case of the respondent-Corporation that since 25 per cent of the production was allowed to be cleared in the domestic market subject to payment of excise duty, equivalent to the custom duty, is added. We find that the aforesaid position taken by the respondent-Corporation does not flow either from the reading of Rule 2(7)(a) or paragraph 3 of Notification No. 133 of 1994 dated 22.06.1994. Insofar as excise duty is concerned, the said excise duty was not paid on the goods imported. On the contrary, it was paid on the articles that were manufactured out of the goods which were imported. Therefore, the payment of excise duty on such manufactured articles would have no relation or connection with the goods that were imported by the appellants. Once we read and interpret the provisions of paragraph 3 of the notification in the manner stated above, obviously, there was no liability towards customs duty on these goods which were incurred or were liable to be incurred as mentioned in Rule 2(7)(a) of Rules, 1965. It is stated for the sake of repetition that insofar as customs authorities are concerned, they have not only granted exemption, they even allowed the clearance of 25 percent of the production into the domestic area in terms of paragraph 3 of the exemption notification. Thus, as far as goods are concerned, they were fully exempted from payment of any customs duty. Therefore, no liability in this respect is either incurred or was liable to be incurred and therefore, provisions to Rule 2(7)(a) for the purpose of adding the customs duty would not be attracted. - Decided in favour of appellant
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