Import licence debit must follow actual c.i.f. value, not customs market valuation, under licensing control rules.

For debiting an import licence, the relevant figure is the importer's actual c.i.f. value of the goods, not the international market value used for customs duty assessment. The Imports (Control) Order, 1955 and licensing instructions treated the licence as a rupee-denominated foreign exchange control mechanism based on the importer's actual import commitment, while customs duty remained separately assessable under section 14(1) of the Customs Act on the price at the time and place of importation. Clause 10A required truthful declaration of value but did not permit substitution of market price for licence debit purposes. Paragraph 300 of the Handbook was read consistently with this approach.

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Issues: Whether, for debiting an import licence, customs authorities could use the international market value assessed for customs duty or were bound to debit the actual c.i.f. value of the goods imported under the licence.

Analysis: The scheme of the Imports (Control) Order, 1955 and the licensing instructions showed that the licence was granted in terms of rupees to regulate foreign exchange utilisation on the basis of the importer's actual c.i.f. commitment, while customs duty was separately assessable under section 14(1) of the Customs Act, 1962 on the price at the time and place of importation. The definition inserted in clause 2(e) of the Imports (Control) Order did not alter that position. Clause 10A required honest declaration of value by the importer, but did not authorise customs to substitute the international market price for the actual c.i.f. value debitable against the licence. Paragraph 300 of the Handbook, properly read, referred to the c.i.f. value of the goods imported for customs purposes and not to a revaluation that would override the licensing policy or the substantive statute.

Conclusion: The debitable value under the licence was the actual c.i.f. value, not the international market value assessed for customs duty. The challenge to the policy decision and debit entry failed.

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