Countervailing duty and octroi valuation: import duty formed part of assessable value despite bonded warehouse deferral.

Countervailing duty on foreign liquor imported into Greater Bombay was treated as an incident of importation, not as a deferred levy postponed by bonded warehousing. The Bombay Prohibition Act fixed the duty at the point of import, while section 106 addressed only collection mechanics. The Bombay Municipal Corporation Act and Octroi Rules levied octroi on entry for consumption, use or sale and included duties and incidental charges in assessable value. On that basis, countervailing duty formed part of the octroi valuation and was includible in the octroi charge.

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Issues: Whether countervailing duty formed part of the assessable value for octroi and was therefore includible in the octroi levied on foreign liquor brought into Greater Bombay.

Analysis: The charging provisions of the Bombay Prohibition Act, 1949 showed that countervailing duty was attracted on import into the State, while section 106 dealt only with the manner and timing of collection. The Bombay Municipal Corporation Act, 1888 levied octroi on entry of goods into Greater Bombay for consumption, use or sale, and the Octroi Rules defined value to include duties and incidental charges. The bonded warehouse scheme under the import and export rules provided only deferred payment for administrative convenience; it did not postpone the incidence of duty. Countervailing duty was treated as an incident of importation and, in the context of the rules, as part of the cost relevant for octroi valuation.

Conclusion: Countervailing duty was held includible in the octroi assessable value, against the assessee.

Ratio Decidendi: Where the charging statute fixes countervailing duty at import and the octroi rules include duties and incidental charges in the assessable value, deferred collection through bonded storage does not alter the incidence of duty and such countervailing duty is includible in octroi.

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