TaxTMI 
TaxTMI 
2019 (5) TMI 979
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.... the value of Imported Goods) Rules, 2007 issued vide Notification No 94/2007-Cus (NT) dated 13.09.2007. The assessable value is re-determined in terms of Rule 10(2) of the Valuation (Determination of Imported Goods) Rules, 2007 for a 20' container as US$ 3180.74 equivalent to Rs. 128849.97 and for a 40' container as US$ 5088.38 equivalent to Rs. 206079/- [@ US$1 = Rs. 40.50 as conversion rate for the month of May 2008] on the basis of container one way lease agreement dated 06.05.2008. Hence the assessable value of the imported 123 dry containers of size 20' and 34 dry containers of size 40' comes to Rs. 1,58,44,737/- and Rs. 70,06,6856/- respectively. Thus the total re-determined assessable vale of these 157 dry containers comes to Rs. 2,28,51,423/- and hence, the total Customs Duty payable @ 10%+14%+2%+1%+4% comes to Rs. 72,43,904/- (Rupees Seventy Two Lakhs Forty Three Thousand Nine Hundred and Four Only). The importer, M/s Jindal Waterways Limited at the time when the consignments of the three Post Bills of Entry were assessed to had paid duty of Rs. 68,53,440/- vide Challan No HC/557, HC/562 and HC/559 dated 26-09-2008. Hence, the importer, M/s Jindal Waterways Limited and St....
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....and hence, the total Customs Duty payable @ 10%+14%+2%+1%+4% comes to Rs. 29,80,918/- (Rupees Twenty Nine Lakhs Eighty Thousand Nine Hundred and Eighteen Only). The importer and M/s Hyundai Merchant Marine India Pvt Ltd., the steamer agent at the time when the consignments were assessed to had paid duty of Rs. 21,39,681/- vide Challan No 312 dated 05-06-2008. Hence, the importer, M/s Jindal Waterways Limited and Steamer Agent M/s Hyundai Merchant Marine Pvt (India) Limited are liable to pay differential duty of Rs. 8,41,237/- (Rs. 29,80,918/- - Rs. 21,39,681/-) (Rupees Eight Lakh Forty One Thousand Two Hundred Thirty Seven only) along with interest thereon. 4.1.2 All the 67 dry containers totally valued at Rs. 94,03,528/- (Rupees Ninety Four Lakhs Fifty Three Thousand Five Hundred and Twenty Eight only) are confiscated under section 111(d), 111(f) & 111 (m) of the Customs Act, 1962. However an option is given to M/s Hyundai Merchant Pvt (India) Limited to redeem these 157 dry containers on payment of redemption fine of Rs. 10,00,000/- (Rupees Ten Lakhs only) under section 125 of the Customs Act, 1962. 4.1.3 Penalty of Rs. 2,50,000/- (Rupees Two Lakhs Fifty Thousan....
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..../CSTB dated 04.06.2009 rem1nded the matter back to adjudicating authority for re-adjudication after allowing the opportunity of personal hearing to the appellants. 3.1 In their appeal, appellants have challenged the impugned order stating, that: i. They had declared the value of the empty container on the basis of the transaction value between themselves and the Chinese supplier. Transaction value could not have been rejected except in the circumstances specified in Rule 3 (2) of the Customs Valuation Rules, 2007. ii. Replacement cost could not have been considered as transaction value for the goods imported, and even if the transaction value was to be rejected the assessable value should have been determined by the sequential application of Rules 4 to 9. iii. In absence of any proof of extra remittances to the foreign supplier revenue has not discharged the burden of proof for rejecting the transaction value. iv. Since the demand made on the basis of rejection of transaction value cannot sustain, demand of interest to will fail. v. Goods are not liable for confiscation by invoking the provisions of Section 111 (d), (f) and (m). Since....
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....vant paras of commissioner order are reproduced below: 5.3 We find that issue of under valuation has been in depth examined by the Commissioner in his impugned order as is evident from the paras of order reproduce above. Nothing has been brought on record to show that the value determined by the Commissioner is erroneous. The value has been determined by the Commissioner on the basis of replacement cost agreed between Appellant 1 and Appellant 2. Since the replacement cost represent the intrinsic value of container, agreed upon between the lessor and lessee in the one way lease, the same is basis of value. Hon'ble Supreme Court has in case of Garden Silk Mills [1999 (113) ELT 358 (SC)] held as follows: "8. On a careful analysis it is evident that the principles of valuation incorporated in Section 14(1)(a) of the Act therein show that : (a) the price is a deemed price; (b) at which such or like goods are ordinarily sold or offered for sale; (c) for delivery at the time and the place of importation or exportation; (d) in the course of international trade; (e) where the seller and the buyer have no interest in the business of e....
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....No.450/53/98 Cus.IV dated 5th November, 1998) as temporary imports. Subsequently, the domestication of these containers are sought by the importers concerned with authorization from the Shipping Line on payment of duty. 2. This issue has been examined and it has been decided that procedure of domestication of temporarily imported containers on re-export condition will not be permitted in the normal course. Marine containers imported for domestic use, shall be cleared by filing a Bill of Entry for Home Consumption by the importer, on payment of duty. The Shipping Lines should ensure that such containers are duly manifested and they shall be supported by requisite documents such as B/L, Invoice, etc. Applications for additional entry in the manifest for cases, not already manifested in IGM, will be considered on production of supporting evidence such as one way lease agreement, Bill of Lading etc. After scrutiny of the application by the Competent Authority, such additional entry in the respective IGM will be considered on merits. The importer will have to file the Bill of Entry for such Importation of containers and the clearance will be allowed after assessment and payment....
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....e clause "d" to Section 111 is not applicable. Similarly the goods were assessed to duty by the Custom Authority and cleared on payment of duty assessed. There cannot be misdeclaration when there is no dispute about the that entries made in the Bill of Entry were on the basis of an invoice of foreign supplier without holding that the invoice was forged or manipulated. Since it is not so clause "m" of Section 111 wil not be applicable. Similarly when the appellants have followed the practice in manner of making the declarations in Import Manifest, and existence of such practice is admitted by the Commissioner JNCH, Nhava Sheva, in his Public Notice, case of appellants cannot be covered under clause "f" of Section 111. In our view the order of Commissioner holding goods liable under Section 111 (d) (f) and (m) is bad in law and cannot be sustained. 5.7 Since we have held that imported dry containers are not liable for confiscation under Section 111, penalties under Section 112 (a) and (b) (iii) cannot be sustained and hence they are set aside. 5.8 In result while upholding the demand of duty and interest against Appellant 1, we set aside the order confiscating the goods, fine i....
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.... on 02.06.2008 in the Container Cell stating that the above said 157 containers were on a one way basis lease and the owner of these containers was M/s Jindal Waterways Limited who would like to domesticate the same on paying the customs duty and that they had "No Objection" to the owners domesticating the said containers by paying the customs duty as applicable and to provide them with the duty paid customs copy to enable them to cancel the bond. The Steamer Agent had enclosed a letter dated 02.06.2008 of M/s. Jindal Waterways Limited along with their application for domestication, which stated that these containers belonged to them (M/s. Jindal Waterways Limited) and they would like to domesticate the same by paying the Customs duty. 3.4. All the 157 containers were new and were imported by the Steamer Agents but were not declared in the IGM nor were they entered u/s. 46 of the Customs Act, 1962 by the owners. I find that there were two sets of invoice No. JINDAL/RC/2008-1 dated 24.03.2008 one without name of the manufacturer and other with name of manufacturer submitted by M/s Jindal Waterways Limited, the owners, on different d....
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....ion; b) loading, unloading and handling charges associated with the delivery of the imported goods at the place of importation; and c) the cost of insurance." Provided that (i) where the cost of transport referred to in clause (a) is not ascertainable, such cost shall be twenty per cent of the free on board value of the goods; (ii) the charges referred to in clause (b) shall be one per cent of the free on board value of the goods plus the cost of transport referred to in clause (a) plus the cost of insurance referred to in clause (c); (iii) where the cost referred to in clause (c) is not ascertainable, such cost shall be 1.125% of free on board value of the goods; Provided further that in the case of goods imported by air, where the cost referred to in clause (a) is ascertainable, such cost shall not exceed twenty per cent of free on board value of the goods: Provided also that where the free on board value of the goods is not ascertainable, the costs referred to in clause (a) shall be twenty per cent Document 4 of the free on board value of the goods plus cost of insurance for clause (i) above and the cost referred to in clau....
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.... customs purposes, all the import procedures had been completed by M/s. Hyundai Merchant Marine (India) Limited and hence as per above definition, they were the importers, in the absence of their disclosure of the real owner of the containers at the time of entering these containers into the Bond. The contention made in the submissions of ground of appeal that these Assessment Orders have become final will not hold good since the amount of duty calculated earlier was based on the declared transaction value. However, it was later on found that the said declared transaction value was not genuine and correct transaction value as it neither included transport and insurance charges nor it represented the real and correct transaction value in terms of evidences on record. Since the duty was short-levied based on the declared transaction value of the containers wherein the components constituting freight, insurance were not included as such the Document 6 3.10. duty calculated and recovered was short and as per Section 28 of the Customs Act, 1962 the demand for re-calculated duty based on CIF was correct. As per the one way lease agreem....
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....s to Rs. 22851423/- and hence, the total customs duty payable Document 8 3.12. 3.13. @10%+14%+2%-1%+2%+1%+4%, comes to Rs.7243901/- (Rupees Seventy Two Lakhs Forty Three Thousand Nine Hundred One only). The importer, M/s. Jindal Waterways Limited at the time when the consignments of the three Post Bills of Entry were originally assessed to, had paid duty of Rs. 68,53,440/- vide Challan No.HC/557, HC/562 and HC559 dated 26-09-2008. In view of the same, the importer, M/s. Jindal Waterways Limited and the Steamer Agent, M/s. Hyundai Merchant Marine India Pvt. Ltd. are liable to pay differential duty of Rs.3,90,461/- (Rs.72,43,901-68,53,440) on the re-determined value of the 157 containers, ascertained on the basis of one-way lease agreement. I find that the owners M/s. Jindal Waterways Limited had entered into "One way basis lease" with the Steamer Agent i.e. M/s. Hyundai Merchant Marine India Pvt. Ltd. who in turn concealed the facts of ownership of the containers and put them under their Bond executed with Container Cell, JNCH and then gave NOC to domesticate them in favour of M/s. Jindal Waterways Limited, with the intention t....