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TMI Blog2010 (8) TMI 747X X X X Extracts X X X X X X X X Extracts X X X X ..... l to the Commissioner (Appeals), but the appellate authority only sustained the assessments. There are three assessees before us, aggrieved by four orders of the Commissioner (Appeals). The appellate authority passed one order in relation to a set of shipping bills filed by one of these assessees. It passed a separate order in relation to another set of shipping bills filed by the same assessee. Similar orders were passed by the Commissioner (Appeals) in respect of the shipping bills filed by the other two assessees. 2. In all these appeals, the appellants have raised identical grounds, which are summarised below : (a) According to Section 14 of the Customs Act, the value of export goods shall be the transaction value of such goods, i.e. to say, the price actually paid or payable for the goods when sold for export from India for delivery at the time and place of exportation. The transaction value is related to the sale price of the goods and not to the duty to be imposed on such goods when sold. [Reliance placed on the Hon'ble Supreme Court's judgment in Commissioner v. Maruti Udyog Ltd. - 2002 (141) E.L.T. 3 (S.C.)]. If duty element is to be included in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the principles propounded by 'Salmond on Jurisprudence', the ratio decidendi of the Apex Court's judgment in Maruti Udyog (supra) case and the Tribunal's decision in Prompt & Smart Security's case should be squarely applicable to the instant case. 3. The learned counsel has reiterated the above grounds and has endeavoured to amplify some of them. The gist of his arguments is that the price of export-goods, referred to under Section 14 of the Act, is cum-duly price. In other words, the FOB price of export goods is to be treated as cum-duty price. In this connection, the learned counsel has vehemently argued for borrowing the principle laid down by the Apex Court in Maruti Udyog's case (supra) in the context of dealing with a valuation dispute as also the principle laid down by this Tribunal in Service tax cases in the context of examining issues pertaining to taxable value of taxable services. The argument is that the price of the goods should be treated as cum-duty price. 4. On the other hand, the learned SDR submits that Section 14 of the Act is free from ambiguities inasmuch as it clearly lays down that the transaction value of export goods shall be the price paid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as binding on subordinate authorities in the department. It is further submitted that there is no parallel between Section 14 of the Customs Act and Section 4 of the Central Excise Act insofar as the structure of the 'transaction value' is concerned and, therefore, any principle laid down under Section 4 of the Central Excise Act is not liable to be borrowed by the assessing authority functioning under Section 14 of the Customs Act. Learned SDR has also referred to Section 67 of the Finance Act, 1994, which deals with valuation of taxable services for charging service tax. He has particularly referred to Explanation 2 to Section 67 ibid, which reads thus : "Where the gross amount charged by a service provider is inclusive of service tax payable, the value of taxable service shall be such amount as with the addition of tax payable, is equal to the gross amount charged". With reference to this provision of law, SDR submits that the principle of cum-duty price of excisable goods stands adopted for the purpose of determination of taxable value of taxable services. The purport of these arguments is that Section 14 of the Customs Act stands on a different footing vis-a-vis the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be liable to pay all the levies by the governments of their respective countries. In other words, the contract did not permit the incidence of such levy (e.g. export duty) in any of the countries to pass on to the other country. This aspect of the contract, in our view, is in keeping with the legal principle embodied in Section 14 of the Customs Act, which provides that the transaction value of export goods, for the purpose of export duty, shall be the price paid or payable for the goods when sold for export at the time and place of export. It is not in dispute that the time and place of export referred to under Section 14 are, respectively, the time and place of shipment of the goods. The price of the goods at the time and place of shipment is its FOB price, whether paid or payable. The law declares that this shall be the transaction value for the purpose of levy of export duty. It does not make provision for abatement of duty element from the FOB price so as to arrive at the assessable value for the purpose of levy of export duty. As rightly submitted by the learned SDR, the provisions of Section 14 are clear and free from any ambiguity. The Hon'ble Supreme Court, in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of Plantation Corporation of Kerala (supra), the Apex Court reiterated the above rulings and held that, if the intendment was not in the words used it was nowhere else and so long as there was no ambiguity in the statutory language, resort to any interpretative process to unfold the legislative intent became impermissible. The court further held that the need for interpretation arose only when the words in the statute, were on their own terms, ambivalent and did not manifest the intention of the legislature. The above rulings were followed by this Tribunal in the case of Peshawar Soaps & Chemical Works (supra). We have to interpret the provision of Section 14(1) of the Act, keeping in view the above rulings of the Apex Court. Section 14 reads as follows : "SECTION 14. Valuation of goods. - (1) For the purposes of the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force, the value of the imported goods and export goods shall be the transaction value of such goods, that is to say, the price actually paid or payable for the goods when sold for export to India for delivery at the time and place of importation, or as the case may be, for export fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between the parties is cum-duty price would mean that the contracting parties were aware of the rate of export duty for the goods exported in a given calendar year, at the very commencement of the year. If the rate of export duty changes midway in the particular year, how could the contracting parties incorporate the duty element in FOB price at the commencement of the year in respect of goods sold after such change of rate of duty? The above proposition made by the learned counsel is, therefore, unworkable under the contracts referred to by him, nor is it in accord with the provisions of Section 14(1) of the Act. It is in this scenario that we have rejected the plea that the FOB price of the export goods was a cum-duty price. We have already held that the FOB price of the goods was the price actually paid or payable by the buyer to the exporter in respect of the goods exported for delivery at the time and place of export and the same would not contain any duty element. Therefore, there is no question of any duty being levied on any amount of duty. 9. We are not impressed with the reliance placed by the learned counsel on Maruti Udyog (supra) being a Central Excise case or th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... instruct any assessing authority to assess the goods in a particular way in a particular case. Any instructions issued to the contra will not bind such assessing authority or the first appellate authority. This is what we understand from the proviso, which does not say that the orders/instructions/directions issued by the Board under Section 151A of the Act are not binding on the assessing authorities or appellate Commissioners. The circular in question is certainly binding on quasi-judicial authorities under the Board, who may be called upon to decide on identical issues. In this connection, we have perused the Apex Court's judgment in Varsha Plastics (supra) case cited by the counsel. In this judgment, we have not seen any ruling which supports the argument advanced by the learned counsel in relation to the Board's circular. 12. The learned counsel has also claimed support from an order-in-appeal passed by the Commissioner of Customs (Appeals), Kolkata, wherein the FOB price of iron ore exported by one of the present appellants was held to be cum-duty price and accordingly abatement of duty element from the FOB price was allowed to the assessee. The appellate Commissioner's ..... X X X X Extracts X X X X X X X X Extracts X X X X
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