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Issues: Valuation of goods in High Sea Sale transaction
Analysis: The appeal revolved around the valuation of goods in a High Sea Sale transaction made by the appellant with M/s. Arun Sales Corporation. The main question was whether the declared value of the goods should be increased by 2% extra as per the agreement between the parties. The appellant contended that the agreed price for the High Sea Sale transaction was US $31,050 plus 2%, totaling US $31,671, in line with the practice for such sales. The appellant relied on a previous Tribunal decision to support this argument, emphasizing that the transaction value should be based on the agreed price between the parties without contradictory evidence. The learned Counsel highlighted that there was no evidence presented by the Revenue to dispute the agreed value, and therefore, the duty liability should be based on the value of US $31,671 for the goods. The Departmental Representative (DR) supported the order of the authority below, which was in favor of increasing the value by 2% as per the agreement. However, upon hearing both sides and examining the record, the Tribunal found no ulterior motive of the appellant in claiming the valuation of US $31,671. The Tribunal noted that there was clear documentation on page 16 of the appeal folder where both parties had agreed that the consideration for the sale would be US $31,671. In the absence of any evidence to suggest otherwise, the Tribunal concluded that the agreed value should be accepted. The Tribunal also referenced a previous Tribunal decision to support their ruling, directing that the value of US $31,671 would be deemed appropriate for the goods in question. Consequently, the appeal was allowed with the specified direction, thereby modifying the impugned order in favor of the appellant. This judgment highlights the importance of honoring the agreed price between parties in High Sea Sale transactions, especially when there is no contradictory evidence to challenge the declared value. The decision underscores the significance of clear documentation and adherence to the terms of the agreement in determining the valuation of goods for duty liability purposes.
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