TaxTMI 
TaxTMI 
2007 (12) TMI 336
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....ms [2004 (174) E.L.T. 344 (Tri. - Mum.)] and Essar Oil Ltd. v. Commissioner of Customs [2004 (174) E.L.T. 379 (Tri. - Mumbai]. While in the case of Reliance Industries Ltd., it had been held that 'barging charges' were not to be included in the assessable value of the goods, it was held to the contrary in the case of Essar Oil Ltd. 2. We had partly heard the matter on 4-8-2006 and directed the SDR, who represented the Revenue, to produce a map or sketch of the place of loading/unloading as well as the 'Customs area' specified in Notification No. 9/99, dated 4-6-99 issued under Section 8 of the Customs Act by the Commissioner of Customs, Ahmedabad. The map produced by the SDR was examined by this Bench on 11-9-2006 and personal hearing concluded on the same day. After examining the records and considering the submissions made by both sides and the case law cited by them, we took the view that the 'barging charges' were includible in the assessable value of the goods and, accordingly, the referred issue was answered in favour of the Revenue and the assessee's appeal was dismissed. On 11-9-2006 itself, in open court, our decision was pronounced with 'detailed order to follow'.....
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.... the transportation of the goods upto the jetty were to be included in the freight to be part of the assessable value; and that the appeal filed by the party against the order of the original authority was rejected by the Commissioner of Customs (Appeals), who held that the cost of bringing the goods from the ships to the "landmass of India" was part of transportation cost to be included in the CIF value of the goods. Hence the present appeal by the assessee. 4. Learned counsel for the appellants referred to the 'Stevedoring and Handling Agreement' between the appellants and M/s. Cargill India Pvt. Ltd. who, under the said agreement, provided the services of stevedoring, handling and 'associated onshore logistics' to the appellants in respect of the goods imported by the latter. With reference to the terms of this agreement, learned counsel argued that the barging of the goods from the anchorage to the jetty was part of stevedoring and, therefore, Customs duty was not leviable on the barging charges. In this connection, reliance was placed on the Board's Circular No. 80/2002-Cus. dated 29-11-2002. Learned counsel alternatively pointed out that the barging charges were alrea....
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....), learned SDR argued that the place of importation in terms of Section 14(1) of the Customs Act, in respect of the subject goods, could only be the jetty being part of the landmass of India and, therefore, the cost of transportation of the goods from the vessel (at anchorage point) to the jetty should form part of the freight to be included in the assessable value of the goods under Rule 9(2)(a) of the Customs Valuation Rules, 1988. She pointed out that freight upto the anchorage point only had been included in assessable value by the appellants in this case. Learned SDR claimed that a correct decision on the issue whether 'barging charges' formed part of the cost of transportation to be included in the assessable value of goods had already been rendered by the Tribunal in the cases of Ispat Industries Ltd. v. CC, Mumbai, 2001 (135) E.L.T. 646 (Tri. - Mum.), Essar Oil Ltd. (supra) and Sri Sakthi LPG Ltd. v. Commissioner of Central Excise & Customs, Visakhapatnam, 2005 (187) E.L.T. 487 (Tri. - Bang.). She sought to distinguish the appellants' case from the case of Ispat Industries considered by the apex court, by pointing out that, in the latter, the importer had paid to the seller....
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....Jetty was not to be included in the assessable value of the goods. It was held that, as the freight upto Dharamtar Jetty had been paid by the importer as a percentage of the FOB value, any additional transportation charges for carrying the goods from the mother ship to the jetty were not to be included in the assessable valve. It was held that the mother ship not being able to go upto the jetty was an extra ordinary situation due to lack of draft and hence any extra transportation to meet this situation was not to be added to the value of the goods. It was also found that since Dharamtar was shown as the port of discharge in the Bills of Lading, the freight charges paid by the buyer to the shipper included freight upto Dharamtar. Accordingly, the Hon'ble Supreme Court held that the "barging charges" were not includible in the assessable value of the goods. 7. The Bill of Lading in the instant case showed "ROZY ANCHORAGE PORT (INDIA)" as the port of discharge, which was named 'BEDI PORT' in the Bills of Entry. According to data gathered by SDR from the website of Gujarat Maritime Board, Bedi, very close to Jamnagar city, is an all-weather tidal lighterage port classified as ....
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....proviso to the Section was applicable) has not been rebutted, nor is it the Revenue's case that the goods while at anchorage should not have assessed to duty and allowed to be cleared for home consumption under Section 47(1) of the Act. The only case of the Revenue is that, as the barging charges were not a part of the freight paid by the assessee to the seller of the goods, the same should be added to the assessable value of the goods on the ground that the freight component should include cost of transportation upto the jetty. 8. In support of the above case of the Revenue, the Departmental Representatives relied on the apex court's decision in Garden Silk Mills case, but this case was distinguished by the court in Ispat Industries (supra) by observing that Garden Silk (supra) was not a case relating to transportation of goods by barge from the mother ship to jetty and that it was a case where the question was whether landing charges could be included in the assessable value of the subject goods under Section 14 of the Customs Act. Ld. DRs also relied on the Hon'ble High Court's decision in Shriram Fibres case (supra). But, in this case also, the question was whether land....
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....dy been included in the price paid by the appellants to the seller under CIF contract and, therefore, any further addition to the cost of transportation under Rule 9(2)(a) is not permissible. 10. Ld. SDR has heavily relied on para 37 of the apex court's judgement in Ispat Industries. This para reads as follows :- "37. In our opinion, it is really not necessary to decide whether the place of importation is the jetty or the BFL. Whether the place of import is deemed to be the BFL or Dharamtar jetty it would make no difference to the conclusion we have arrived at because the cost of transportation of the imported goods has already been included for delivery at the Dharamtar jetty and has already been paid to the seller in the CIF or FOB contract. Hence, a further addition to the transport charges in the form of barge charges for the transportation by barges cannot be said to be contemplated by Section 14 of the Act." The Bill of Lading in that case had nominated Mumbai/JNPT/Dharamtar as the port of discharge. In the present case, the port of discharge mentioned in the Bill of Lading is 'Rozi Anchorage Port', which is the same as Bedi Port (mentioned in the Bills of ....
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....erved thus : "The words "ordinarily sold or offered for sale" do not refer to the contract between the supplier and the importer, but to the prevailing price in the market on the date of importation or exportation". 16. The above decision thus clearly held that it is not the actual price mentioned in the contract between the supplier and the importer which has to be seen, but the prevailing price in the market has to be seen. This again lends support to the view we are taking that Section 14 is a deeming provision and we have not to take specific cases for determining the value of the imported goods unless the same is in accordance with Section 14 of the Act. 17. Hence, while determining the value of Section 14, we must never lose sight of the fact that Section 14(1) is a deeming provision which creates a legal fiction." Their lordships observed that the Valuation Rules had been created to serve the object of Section 14 which was to determine a deeming price and not the actual price of the imported goods. It was in this context that their lordships applied the Gunapradhan principle to hold that Rule 9(2) was subservient to Section 14. Whether the barging charg....