TaxTMI 
TaxTMI 
2018 (4) TMI 785
X X X X Extracts X X X X
X X X X Extracts X X X X
....perate some of their air crafts in domestic sector and continue the service in international sector also. The Aviation Turbine Fuel (AFT) is filled by the appellant for domestic flight operation. When the same aircraft is to embark on an international travel, the ATF in the fuel tank is considered as cleared outside India and when the aircraft returns from foreign trip, the ATF left over/available in the aircraft is considered to be an import item subjected to customs duty as per the applicable rates. So, the Customs Department has demanded the duty. Being aggrieved, the present appeal has been filed by the appellant. 3. With this background, we heard ld. Counsel for the appellant and ld. AR for the Revenue. 4. After hearing both sides an....
X X X X Extracts X X X X
X X X X Extracts X X X X
....construed to be an imported item for the purpose of customs duty. In the importation of such remnant fuel, we could not discern any separate freight element, which can be added in the assessable value. The fuel in the tank is part of aircraft in operation. Fuel cost is calculated, and apparently, forms part of commercial consideration while fixing ticket charges for transporting aircraft. No freight element is attributable to fuel in the tank, the usage of which varies on different parameters. In other words, the aircraft did not transport ATF on which a freight element can be attributed. The plain meaning of „Freight' is goods that are transported by ships, planes, trains or lorries/trucks; the system of transporting goods in this ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... absence of invoice for ATF, the price at which Indian Airlines purchase ATF for international flight can be considered for valuation. In such situation, it will not be tenable to add a further notional freight of 20% to arrive at the assessable value. On this ground also, we find the impugned order is not sustainable. Regarding liability of the appellant for penalty under Section 112, we note that the impugned order observed that the appellants failed to follow the procedure of filing bill of entry and valuing the ATF properly. Admittedly, the appellants have been filing details of arrival of aircraft from foreign trip along with quantity of fuel etc. On arrival re-conciliation of quantity of fuel along with duty payable is also submitted.....