Customs valuation at port landmass includes landing charges and excludes territorial waters as the point of importation.

For customs valuation under Section 14 of the Customs Act, the point of importation was treated as the landmass and port, not territorial waters, because "into India" was read as referring to goods brought onto Indian land for delivery. On that construction, customs duty attached at the time and place of importation on the port landmass. The Court also held that landing charges incurred before delivery at the port formed part of the assessable value, as they were part of the cost of import and not post-importation expenses. The result was that landing charges were includible in customs valuation.

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Issues: (i) Whether, for levy of customs duty, the place of importation is the territorial waters or the landmass/port. (ii) Whether landing charges form part of the assessable value under Section 14 of the Customs Act, 1962.

Issue (i): Whether, for levy of customs duty, the place of importation is the territorial waters or the landmass/port.

Analysis: Customs duty under Section 12 is attracted on goods imported into India, and the expression "into India" was read consistently with exportation from India so as to refer to the landmass and not territorial waters. The valuation scheme under Section 14 proceeds on the price at the time and place of importation, which supports the view that importation is complete when the goods are landed at the port and brought onto the landmass. Earlier High Court decisions and the practical working of customs assessment were treated as supporting this construction.

Conclusion: The place of importation is the landmass and the port, not the territorial waters; this issue is answered against the assessee.

Issue (ii): Whether landing charges form part of the assessable value under Section 14 of the Customs Act, 1962.

Analysis: Section 14 requires valuation by reference to the price at which like goods are ordinarily sold or offered for sale at the time and place of importation, for delivery, in the course of international trade. On that basis, the Court held that landing charges incurred before delivery at the port are part of the cost of import and cannot be treated as excluded post-importation expenses. The Court also relied on the need to avoid an unduly refined construction and accepted the long-standing administrative and commercial practice of including such charges in assessable value.

Conclusion: Landing charges are includible in the assessable value for customs duty purposes; this issue is answered against the assessee.

Final Conclusion: The writ petitions failed because customs duty was rightly levied by including landing charges in the assessable value, and the relevant point of importation was the port landmass rather than territorial waters.

Ratio Decidendi: For customs valuation under Section 14, the assessable value is the price at the time and place of importation on the landmass, and charges necessarily incurred before delivery at the port, including landing charges, form part of that value.

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