2019 (4) TMI 2132

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.... Government owned air carrier and operates various international and domestic flights from IGI Airport, Delhi to foreign destinations and within the country. For the purpose of flights, the appellants uplifts Air Turbine Fuel (ATF) in bond as well as on payment of applicable duty on the international flight since the ATF carried by the foreign going aircraft is not enough for return journey, the aircraft purchases ATF at a foreign station for return journey. As per the provisions of notification no. 151/94 Cus dated 13.7.1994, the duty paid on ATF taken by the aircraft while commencing the journey for foreign destination is deducted from remnant fuel after the aircraft finishes its international run and the balance quantity of ATF remaining....

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.....3.18 321/Commr/Adj/2018 dated 31.08.2018 22,30,671/- duty +22,30,671/- penalty 3 C.No.VIII(AP)10/ P&I/ ShiftC/ Misc/2015 dated 18.6.2018 321/Commr/Adj/2018 dated 31.08.2018 23,68,378/-duty +23,68,378/- penalty 3. The appellants are before us against the above mentioned three appeals against these Order-in-Originals. 4. The learned advocate appearing for the appellants have contended that the adjudicating authority has failed to appreciate that the residual fuel remaining in the aircraft does not involve any refuelling activity and, therefore, there is no loading cost and since it remains in the aircraft, it cannot also be attributable to any loading expenditure that has been incurred by the appellant. 5. The lear....

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....ailable in the fuel tank of aircraft landing in India from an international trip. The duty liability on such ATF is not under dispute. However, its valuation, more specifically, addition of freight element on notional basis to arrive at the value of such ATF is in dispute. The Original Authority held that the remnant ATF is transported by the aircraft and as such, as the actual freight is not ascertainable, a notional freight in terms of Rule 10(2) is to be added to arrive at the assessable value of ATF. We note that the aircraft requires ATF for its propulsion. As per the Civil Aviation Regulating requirements and also for safety, aircraft caries adequate amount of fuel in its flight. The consumption of fuel depends on various factors. Fac....

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....d that the freight of ATF is not ascertainable. We note that there is no freight element involved and hence, there is no application for Rule 10 (2). 8. The Hon'ble Supreme Court in Wipro Ltd. (2015) 14 SCC 161, held that normally, the value of imported goods has to be the transactional value which means the price "actually paid" or "payable" for the goods imported. When the value of transaction could not be determined then the Rules are applied to arrive at the value. The endevour is to have closest proximity with the actual price. Dealing with addition of loading and handling charges at 1% on notional basis as per Rule 9 of Valuation Rules, the Apex Court held that when the actual cost towards handling charges are available, noti....