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2016 (10) TMI 126 - SUPREME COURT

2016 (10) TMI 126 - SUPREME COURT - 2016 (339) E.L.T. 497 (SC) - Valuation - 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 valu .....

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ty, 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 relatio .....

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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 - Civil Appeal No. 3653/2007 With C.A. No. 3656/2007 and C.A. No .....

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n dismissed accepting the contention of the respondent, Brihanmumbai Mahangar Palika, that for the purpose of payment of octroi duty when the goods are to be valued, customs duty shall also be added. The entire dispute in these appeals is, therefore, as to whether such 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 (hereinafter referred to as 'Rules'). This issue has arisen in the foll .....

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m payment of customs duty. We are not concerned with all other conditions mentioned therein as pointed out above. One of the conditions is that the goods are re-exported. Paragraph 3 of this notification allows this exemption even when part of the articles manufactured are allowed to be cleared outside the Santacruz Electronic Export Processing Zone (SEEPZ) under and in accordance with the Export-Import policy on the condition that where the goods are not exicisable, custom duty is paid thereon .....

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course of production, manufacture, processing or packaging of such articles even if not exported out of India, are allowed to be cleared outside the Zone under and in accordance with Export-Import Policy and subject to such other limitations and conditions as may be specified in this behalf by the Development Commissioner of the Zone, on payment of duty of excise leviable thereon under section 3 of the Central Excises & Salt Act, 1944 (1 of 1944) or where such articles (including rejects, wa .....

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ere entitled to clear 25 per cent of its production into domestic area on payment of excise duty calculated at the rate of 50 per cent of each of the duty of customs payable on the like goods manufactured outside India and the appellants, accordingly, during the period in question, i.e., April, 1992, to November, 1994, cleared the computer systems manufactured in the export processing zone in the domestic tariff area. For the purpose of octroi that is to be paid under the aforesaid Rules, the re .....

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ental charges excepting octroi incurred or liable to be incurred by the importer till the articles are removed from the place of import. 3. As per the respondent Corporation, since duty was paid on the said 25 per cent of produced articles which were released in the domestic area, customs duty became payable and, therefore, the Corporation was within its rights to include the said duty while arriving at the value of the goods. 4. From the reading of Rule 2(7)(a), it becomes clear that for ascert .....

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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. 5. Insofar as the notification is concerned, as mentioned above, the appellants were allowed to import the computer parts without payment of customs duty. Their claim that they were entitled to exemption from payment of custom duty was accepted by custom authorities. Further, as f .....

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