2023 (8) TMI 1635 - AT - Customs

Customs Duty Appeal Succeeds: Transaction Value Principle Validates Import Assessment Based on Final Invoice Price and Acceptable Weight Variation

HINDALCO INDUSTRIES LIMITED Versus C.C. -AHMEDABAD

CESTAT Ahmedabad allowed an appeal by an industrial company challenging customs duty assessment. The tribunal ruled that the final invoice price, ... Assessment of value of imported Copper Anodes - Revenue has sought to demand duty at the assessable value based on the LME prevailing at the time of import, however, taking the quantity as per the provisional invoice issued by the exporter - HELD THAT:- In the instance case, learned counsel has pointed out that the difference in weight between the provisional of final invoice for the order of 0.01%. The said difference can arrive on account of the margin of error in the measuring instruments. In any case the agreement between the buyer and the seller in this case is that the weight at the place of import will be taken as the final weight and the LME price prevailing at the material time will be taken as the final assessable value. The final invoice is based on the weight measure at the place of import and the LME price at the time of import in term of the agreement between buyer and the seller. The Circular dated 27.08.2008 is squarely applicable to the appellant's case. Appeal allowed. The Appellate Tribunal (CESTAT Ahmedabad) allowed the appeal filed by Hindalco Industries Limited against a Customs duty demand. The dispute concerned the assessable value of imported copper anodes, where provisional assessment was made based on a provisional invoice quantity and LME price at import, while the final invoice reflected weight measured at the place of import and the LME price prevailing then, as per contractual terms.The Tribunal emphasized the CBEC circular dated 27.08.2008, which states: 'Transaction value which in this case is the Final Invoice price, arrived at as per the terms & condition of the contract, should be acceptable, unless there are cogent reasons to doubt the transaction.' It held that the minor 0.01% difference in weight was within the margin of error of measuring instruments and that the final invoice, based on actual weight at import and prevailing LME price, constituted the correct assessable value.Rejecting the revenue's reliance on provisional invoice quantities, the Tribunal found the circular squarely applicable and set aside the impugned order, allowing the appeal.