TMI Blog2019 (11) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... t of transport was not immediately available to them. The currency price are available directly on minute to minute basis every day. More over it is seen that out of total cost of ₹ 4.32 Crores paid to the freight forwarder. The appellant had included only ₹ 1.6 crores, in 15 consignments. Even if the actual freight of first 10 consignments was known on actual basis it could not have been its 40% of the total freight for 66% of the total consignments. The documents on the basis of which they had included freight on actual basis were however not available with AMW. Benefit of EPCG Scheme denied on the enhanced value of the imports - HELD THAT:- The impugned order denies the benefit of the EPCG scheme on the ground that the Chapter 5 of the Foreign Trade Policy requires the importer to produce license for debit by the proper officer of customs at the time of clearance. It has been argued in the impugned order that since the said amount was not declared at the time of import the benefit of scheme cannot be extended to the appellant. We do not find any merit in this argument -It is a fact that the appellant have EPCG License containing a specific amount. Therefore, if th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reign Party. In terms of the agreement with the seller the Asia Motor Work was required to do as follows: 2.4 Cost of freight for shipment, loading of the ship and the shipment to Indian harbor will be paid for by the Purchaser. Port of discharge will be Kandla of Mundra. 2.5 The purchaser shall be responsible for all costs and actions subsequent thereto which will include payment of all local Indian taxes and / or import duties, etc. 2.6 All shipping, insurance and customs costs to be incurred, as well as risk of damage and loss to the Assets during transportation shall be borne by the Purchaser. Consequently AMW appointed a freight forwarder namely Pro Logistics (I) Limited (PLIL) offered following terms for the said transport of goods from Argentina to India. Proposal For Ex Works In Argentina. We are pleased to detail below our indicative prices for cutoms clearances at Buenos Airs Port, Argentina for the forth coming movement of approx. 50 FEU s (1) Inland Freight + Ocean Freight per Container Liner: USD 2150.00/40 GB and HC Buenos Airs Charges: CAF: Variable cost to be charged at actual BAF: Varibale cost to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at where the free on board value of the goods is not ascertainable, the costs referred to in clause (a) shall be twenty per cent of the free on board value of the goods plus cost of insurance for clause (i) above and the cost referred to in clause (c) shall be 1.125% of the free on board value of the goods plus cost of transport for clause (iii) above]. [Provided also that in case of goods imported by sea stuffed in a container for clearance at an Inland Container Depot or Container Freight Station, the cost of freight incurred in the movement of container from the port of entry to the Inland Container Deport or Container freight Station shall not be included in the cost of transport referred to in clause (a).] He argued that at the time of filing of Bill of Entry the Freight element was not known to the appellant in respect of 5 Bills of Entries and therefore, in terms of aforesaid proviso to rule 9(2) of the Custom Valuation Rules, Freight @ 20% of FOB Value was included for the purpose of Assessment. He argued that the computation of freight depended on the CAF BAF which are variable cost depending on the exchange rates. He pointed out that since these amounts were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out that the ₹ 4,50,15,398/- was demanded by the Freight forwarder from the AMW and ₹ 4,32,98,915/- was actually paid by the AMW to the freight forwarder. They had included only an amount of ₹ 1,60,69,376/- in the assessable value of all 15 bills of entry. He pointed out that in first 10 bill of entries they had included freight, on the basis of some documents, an amount that they claimed was the actual cost of transport and in balance five B/E, they had claimed benefit of proviso to Rule 9 (2) of CVR 1988. He pointed out that the bills of entries were filed over a period from 10.05.2007 to 29.06.2007 a period of almost 50 days. While in case of bill of entries filed from 10.05.2007 to 12.06.2007 actual transport freight was claimed to be available with the AMW and claimed to have been included in the assessable value, but in respect of bill of entries filed from 12.06.2007 to 29.06.2007 the freight amount was not known to them at the time of filing bill of entry. He pointed out that out of total amount of ₹ 4,32,98,915/-, the appellant have included only ₹ 1,60,69,376/- in the assessable value. They have failed to include an amount of ₹ 2,92,35 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not take away the power of the customs authorities to levy redemption fine. He argued that in the instant case the clearance has been made against a bond. He argued that in these circumstances the impugned order should have ordered confiscation of goods and imposed redemption fine. 3.3 Ld. AR pointed out that the demand under section 28 can be raised even if the assessment is not revised or challenged in view of the decision of Hon‟ble supreme court in case of Jain Shudh Vanaspati Ltd.,1996 (86) ELT 460 (SC). 4. We have gone through rival submissions. We find that AMW had purchased a paint shop in Argentina. The obligation of seller was just to dismantle the plant and thereafter it was the responsibility of AMW to bring the said goods from Argentina to India. AMW engaged freight forwarder namely Prologestics I Ltd. (PLIL) who offered them their services on the following terms. Proposal For Ex Works In Argentina. We are pleased to detail below our indicative prices for cutoms clearances at Buenos Airs Port, Argentina for the forth coming movement of approx. 50 FEU‟s (1)Inland Freight + Ocean Freight per Container Liner: USD 2150.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever not available with AMW. 4.2 Rule 9 (2) of the Custom valuation rules reads as follows. (2) For the purposes of sub-section (1) and sub-section (1A) of Section 14 of the Customs Act, 1962 (52 of 1962) and these rules, the value of the imported goods shall be the value of such goods, for delivery at the time and place of importation and shall include - (a) the cost of transport of the imported goods to the place of importation; (b) loading, unloading and handling charges associated with the delivery of the imported goods at the place of importation; and (c) the cost of insurance : [Provided that - (i) where the cost of transport referred to in clause (a) is not ascertainable, such cost shall be twenty per cent of the free on board value of the goods; (ii) the charges referred to in clause (b) shall be one per cent of the free on board value of the goods plus the cost of transport referred to in clause (a) plus the cost of insurance referred to in clause (c); (iii) where the cost referred to in clause (c) is not ascertainable, such cost shall be 1.125% of free on board value of the goods; Provided further that in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not been challenged, demand under section 28 cannot be raised. In this regard Ld. AR had relied on decision of Ld. Apex Court in case of Jain Shudh Vanaspati Ltd. (Supra) wherein it has been held that the demand can be raised under section 28 even if challenging assessment. Consequently this argument of Ld. Counsel for AMW is rejected. 7. The next issue relates to invocation of extended period of limitation. We find that the appellant have paid significantly higher amount to the freight forwarder as freight. However, in 15 Bills of entry filed by AMW only 40% of the freight has been included in the assessable value. When the agreement and terms of payment are crystal clear the actions of importer are clearly intended to evade taxes. When documents on actual freight paid were demanded, Ld. Counsel failed to produce the same. In these circumstances, we find that it was a specific modus operandi devised by AMW to defraud the Government and therefore, extended period of limitation is rightly invoked in the instant case. 8. The next issue relates to confiscation of the goods already cleared by the AMW. The impugned order does not order confiscation and does not impose any redemp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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