TaxTMI 
TaxTMI 
2019 (11) TMI 622
X X X X Extracts X X X X
X X X X Extracts X X X X
....ty. In terms of the agreement with the seller the Asia Motor Work was required to do as follows: "2.4 Cost of freight for shipment, loading of the ship and the shipment to Indian harbor will be paid for by the Purchaser. Port of discharge will be Kandla of Mundra. 2.5 The purchaser shall be responsible for all costs and actions subsequent thereto which will include payment of all local Indian taxes and / or import duties, etc. 2.6 All shipping, insurance and customs costs to be incurred, as well as risk of damage and loss to the Assets during transportation shall be borne by the Purchaser." Consequently AMW appointed a freight forwarder namely Pro Logistics (I) Limited (PLIL) offered following terms for the said transport of goods from Argentina to India. "Proposal For Ex Works In Argentina. We are pleased to detail below our indicative prices for cutoms clearances at Buenos Airs Port, Argentina for the forth coming movement of approx. 50 FEU's (1) Inland Freight + Ocean Freight per Container Liner: USD 2150.00/40'GB and HC Buenos Airs Charges: CAF: Variable cost to be charged at actual ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....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 of the free on board value of the goods plus cost of insurance for clause (i) above and the cost referred to in clause (c) shall be 1.125% of the free on board value of the goods plus cost of transport for clause (iii) above]. [Provided also that in case of goods imported by sea stuffed in a container for clearance at an Inland Container Depot or Container Freight Station, the cost of freight incurred in the movement of container from the port of entry to the Inland Container Deport or Container freight Station shall not be included in the cost of transport referred to in clause (a).]" He argued that at the time of filing of Bill of Entry the Freight element was not known to the appellant in respect of 5 Bills of Entries and therefore, in terms of aforesaid proviso to rule 9(2) of the Custom Valuation Rules, Freight @ 20% of FOB Value was included for the purpose of Assessment. He argued that the computation of freight....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sion of Hon‟ble Apex Court in case of Western Components (Supra). 3. The Ld. AR relied on the impugned order. He pointed out that the Rs. 4,50,15,398/- was demanded by the Freight forwarder from the AMW and Rs. 4,32,98,915/- was actually paid by the AMW to the freight forwarder. They had included only an amount of Rs. 1,60,69,376/- in the assessable value of all 15 bills of entry. He pointed out that in first 10 bill of entries they had included freight, on the basis of some documents, an amount that they claimed was the actual cost of transport and in balance five B/E, they had claimed benefit of proviso to Rule 9 (2) of CVR 1988. He pointed out that the bills of entries were filed over a period from 10.05.2007 to 29.06.2007 a period of almost 50 days. While in case of bill of entries filed from 10.05.2007 to 12.06.2007 actual transport freight was claimed to be available with the AMW and claimed to have been included in the assessable value, but in respect of bill of entries filed from 12.06.2007 to 29.06.2007 the freight amount was not known to them at the time of filing bill of entry. He pointed out that out of total amount of Rs. 4,32,98,915/-, the appellant have incl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ant case the clearance has been made against a bond. He argued that in these circumstances the impugned order should have ordered confiscation of goods and imposed redemption fine. 3.3 Ld. AR pointed out that the demand under section 28 can be raised even if the assessment is not revised or challenged in view of the decision of Hon‟ble supreme court in case of Jain Shudh Vanaspati Ltd.,1996 (86) ELT 460 (SC). 4. We have gone through rival submissions. We find that AMW had purchased a paint shop in Argentina. The obligation of seller was just to dismantle the plant and thereafter it was the responsibility of AMW to bring the said goods from Argentina to India. AMW engaged freight forwarder namely Prologestics I Ltd. (PLIL) who offered them their services on the following terms. "Proposal For Ex Works In Argentina. We are pleased to detail below our indicative prices for cutoms clearances at Buenos Airs Port, Argentina for the forth coming movement of approx. 50 FEU‟s (1)Inland Freight + Ocean Freight per Container Liner: USD 2150.00/40‟GB and HC Buenos Airs Charges: CAF: Variable cost to be charge....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2 Rule 9 (2) of the Custom valuation rules reads as follows. "(2) For the purposes of sub-section (1) and sub-section (1A) of Section 14 of the Customs Act, 1962 (52 of 1962) and these rules, the value of the imported goods shall be the value of such goods, for delivery at the time and place of importation and shall include - (a) the cost of transport of the imported goods to the place of importation; (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 good....