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TMI Blog2019 (2) TMI 1255X X X X Extracts X X X X X X X X Extracts X X X X ..... /03/2001 to 09/10/2007. There were doubts whether ship demurrage charges were to be included in the value of the imported goods for the purpose of payment of Customs Duty. The question of whether ship demurrage charges were required to be included in the assessable value of imported goods was the subject matter of several clarifications issued by the Central Board of Excise and Customs. In the circular dated 14/08/1991, CBEC circulated that ship demurrage charges were not to be included in the assessable value. However, this stand was reversed by issue of a circular dated 02/03/2001. The issue came before the Hon'ble Supreme Court in the appellant's own case reported in 2004 (165) E.L.T 257 (S.C.), in which the Apex Court decided that the D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circular dated 26/09/2006. The Commissioner (Appeals), however followed the decision of the Larger Bench and ordered that there was no justification for inclusion of the ship demurrage charges. The said order is being challenged in the present proceedings on the ground that the Commissioner (Appeals) has granted relief only for the period up to 26/09/2006. It is the contention of the appellant that the Customs (Valuation) Rules, 2007 was notified only on 10/10/2007, in which the provision for inclusion of ship demurrage charges has been incorporated. As such, it is the contention of the appellant that they will be entitled to the benefit of non-inclusion of such charges not only upto 26/09/2006, but also right upto 09/10/2007. 4. The appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... teria to the earlier provisions and it is seen that it includes an explanation which specifically talks about inclusion of ship demurrage charges lighterage or barge charges in the cost of transport of the imported goods. Both sides could not lay on record, any material to hold these provisions were applicable retrospectively. 11. We find strong force in the contentions raised by the ld. counsel as to the judgment of the Apex Court in the case of Ispat Industries Ltd. (supra) wherein their lordships were considering a similar issue would cover the case of the assessee. In the Ispat Industries Ltd. case, their lordships were considering as to whether the freight incurred on barges and other associated charges in transportation of the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es Ltd. The ratio of the Apex Court specifically lays down that if the contracts entered either CIF or FOB contracts and such type of contracts will always include the freight paid to seller, further addition to the transport charges under Rule 9(2)(a) of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 was clearly impermissible. It is also to be noted that subsequent to the judgment of the Apex Court, the legislature has brought in new Customs (Valuation) Rules, 2007 which provides for inclusion of cost of ship demurrage charges, lighterage and barge charges, in the value of transportation. In the light of the clear provisions, from the date when provisions of Customs (Valuation) Rules, 2007 came into picture, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssary blocked because of delay in unloading. This is an eventuality which has nothing to do with regard to importation of the goods for the purpose of assessment of customs duty. Customs duty is charged on the basis of the value described in the bill of lading. If there is any under-invoicing made, the authority is entitled to take appropriate assessment to find the actual value. In no stretch of imagination the demurrage can be included in the value of the goods for the purpose of assessment of customs duty under Section 14(1) of the Customs Act, 1962 or any other provision of the said Act." 9. By following the decision of the Larger Bench, we modify the impugned order and direct the Lower Authority to re-assess Bills of Entry of the app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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