TMI Blog2017 (1) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... (Judicial) And Shri C J Mathew, Member (Technical) Shri Krishnamohan K Menon, Advocate with Shri Bhishma Ahluwalia, Chartered Accountant for the appellant Shri M.K. Sarangi, Jt. Commissioner (AR) for the respondent Per: M.V. Ravindran: These two appeals raise a common question and hence are disposed of by a common order. 2. The issue in brief is that the appellant herein filed two shipping bills No. 80/11-12 dated 19/05/2011 and 55/11-12 dated 06/05/2011 for export of 54500 WMT and 54200 WMT of iron ore fines of grade 50% Fe and 52% Fe respectively to China. The said shipping bills, provisionally assessed upon request, permitted export of the cargo on payment of duty and by furnishing of provisional assessment bonds against 20% of freight on board value of export cargo but subject to submission of final test report/bank reconciliation certificate and final draught survey for finalising of shipping bills. On receipt of the test report from the Customs Laboratory and on submission of the documents by the appellant, the assessment was finalised. 3. The adjudicating authority calculated the duty liability for final assessment of both the shipping bills and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rge port at the value as evidenced from BRC and assessment was to be finalised accordingly. It is his submission that this issue in the case of VGM Exports (supra) also arose from the same Commissionerate and the order of the same Commissioner (Appeals). He would submit that the Commissioner (Appeals) was wrong in coming to a conclusion that transaction value for export transaction varies when there is change in novation or substitution of export contract and reads the provisions of Section 14 of the Customs Act and submits that duty liability is on the price actually paid or payable for the goods when sold for export from India for delivery at the time and place of exportation. It is his submission that the provisions of Section 14 if read holistically would mean that the appellant has to discharge export duty on the amount ordinarily realized by them from the foreign purchaser and the same has to be accepted as the transactions are not between the related party and price was the sole consideration for sale. It is also his submission that there is no allegation that price was not a sole consideration or there was any flow back of the amount to the appellant. It is his submissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment Ltd. Subsequently the said goods were redirected to M/s. Rhizao Zhongrui, China. He would submit that the provisional assessment was conducted based upon the Fe contents declared at 52% and 54%. The Dy. Chief Chemist report for the consignments also indicate that the Fe contents were same as was declared. He would submit that subsequently if lower Fe contents were noticed at the port of destination, that cannot be the reason for accepting the value which was received by the appellant for the said consignments and finalised for the levy of export duty. He would submit that the appellant is not disputing that they have entered into revised contract with another buyer based upon the Fe contents as per the analysis done at port of destination has no relevance for finalisation of assessment as it goes against the provision of Section 14 of the Customs Act, 1962 which is based upon deemed value concept rather than BRC concept and it is at the time of export. It is his submission that the appellant had not decided to challenge the Customs Lab report and it is binding on them and the submission that the said Customs Lab report was not given to them is incorrect as the CHA was given al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Provided that such transaction value in the case of imported goods shall include, in addition to the price as aforesaid, any amount paid or payable for costs and services, including commissions and brokerage, engineering, design work, royalties and licence fees, costs of transportation to the place of importation, insurance, loading, unloading and handling charges to the extent and in the manner specified in the rules made in this behalf: Provided further that the rules made in this behalf may provide for,- (i) the circumstances in which the buyer and the seller shall be deemed to be related; (ii) the manner of determination of value in respect of goods when there is no sale, or the buyer and the seller are related, or price is not the sole consideration for the sale or in any other case; (iii) the manner of acceptance or rejection of value declared by the importer or exporter, as the case may be, where the proper officer has reason to doubt the truth or accuracy of such value, and determination of value for the purposes of this section : Provided also that such price shall be calculated with reference to the rate of exchange as in forc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case in hand we find that the Dy. Chief Chemist had drawn the samples of the iron ore fines in respect of shipping bill No. 55/11-12 and recorded that the Fe content is 52%. It is settled law that analysis of departmental laboratory, unless challenged, has to be accepted as true and correct. Since the value/price of the iron ore fines is based upon the Fe content of the consignment, the value was, in our opinion, correctly worked out by the lower authorities. 10. Looking at the entire issue from another angle it has to be noted that once the ship sails from the port after the Let Export Order, and the cargo does not arrive at the destination, the assessment entered by the adjudicating authority at the time of Let Export Order remains and does not undergo any change even for the reason that the goods are lost at sea. The exporter does not have a claim for refund. This was conceded by Learned Counsel during his argument. If this principle is applied, which is the correct principle for valuation as per Section 14 of the Customs Act, 1962, the consignment having been declared to be unaccepted by the purchaser cannot be a reason for reduction in the value of the consignment as cleare ..... X X X X Extracts X X X X X X X X Extracts X X X X
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