2018 (2) TMI 1077 - AT - Customs

Supreme Court: Customs duty based on actual quantity received, not bill of lading.

The Supreme Court ruled that the duty on bulk liquid cargo should be based on the quantity actually received in India, not the quantity stated in the out ... Whether the appellant are required to discharge duty on the invoice quantity of bulk liquid cargo imported as reflected in the Bills of entry or on the quantity shown in the out turn report as determined? Held that: - Hon’ble Supreme Court in the case of Mangalore Refinery and Petrochemicals Ltd. Vs CCE Mangalore [2015 (9) TMI 245 - SUPREME COURT] has held that If the goods are pilferred after they are unloaded or lost or destroyed at any time before clearance for home consumption or deposit in warehouse, importer is not liable to pay duty leviable on such goods. Appeal allowed - decided in favor of appellant. Issues involved:Determining duty on the invoice quantity of bulk liquid cargo imported as per Bills of entry versus the quantity shown in the out turn report.Analysis:Issue 1: Duty determination based on invoice quantity versus out turn report quantityThe appeal questioned whether duty should be discharged on the invoice quantity of bulk liquid cargo imported as per Bills of entry or the quantity shown in the out turn report. The appellant relied on the judgment of the Hon’ble Supreme Court in a specific case to support their position. The Revenue, represented by the AR, supported the findings of the Commissioner (Appeals). The Hon’ble Supreme Court analyzed the issue and emphasized that the value of imported goods must be determined at the time and place of importation. The Court highlighted that the quantity of goods for valuation purposes can only be considered after they are imported into India. The Court criticized the Tribunal's reasons for considering only the bill of lading quantity for valuation, stating that such reasoning was legally incorrect. The Court clarified that the taxable event for imported goods is the import itself, and the quantity at the time and place of importation should be the basis for valuation. Additionally, the Court pointed out that the Customs Act provisions and Customs Valuation Rules were not properly considered by the Tribunal. Ultimately, the Court set aside the Tribunal's judgment and declared that the quantity of crude oil actually received in a shore tank in India should be the basis for customs duty payment. The appeal was allowed based on the Supreme Court's ruling, with directions for consequential action by the customs authorities in compliance with the law.This detailed analysis of the legal judgment showcases the critical examination of the duty determination issue between the invoice quantity and out turn report quantity, emphasizing the legal principles and statutory provisions governing the valuation of imported goods.