2013 (12) TMI 1494 - AT - Customs

Waiver of pre-deposit - Refund claim - finalization of provisional assessment - amendment in Section 14 of the Customs Act 1962 for the determination of export duty - Circular dated 10-11-2008 - Held that - Undisputedly the relevant provision of Section 14 had been amended with effect from 11-5-2007 adopting the concept of transaction value applicable to the goods meant for both export and import. Also it is not in dispute that the Board has issued a Circular on 10-11-2008 clarifying certain aspects of Section 14 of the Customs Act 1962 after introduction of duty on export of steels. The method of assessment adopted by the Paradeep Commissionerate taking the FOB price not as cum-duty price but as assessable value has not been in accordance with the said Circular - waiver of pre-deposit allowed - petition allowed.

Summary

Issues:
1. Waiver of pre-deposit of total duty sanctioned as refund but later deemed recoverable.
2. Discrepancy in assessment due to provisional basis evaluation and finalization of FOB price.
3. Interpretation of Circular on computation of export duty and assessable value.
4. Application of transaction value concept post-amendment to Section 14 of Customs Act.

Analysis:
1. The case involved sixteen applications seeking waiver of pre-deposit of duty amounting to Rs. 2.1 crore, initially refunded but later deemed recoverable post-appeals by Revenue. The dispute arose from the assessment of iron ore fines exported against Shipping Bills, where provisional basis assessment was done due to unknown final export price at the time of export.

2. The applicant argued that the final FOB price should be considered as cum-duty price based on prevailing practices at Paradeep Port and a Circular issued post-introduction of export duty on steel products. The Circular aimed at uniformity in assessment practices, but the Revenue contended that transaction value should be the assessable value, citing a Tribunal decision in favor of Revenue.

3. The Tribunal analyzed the Circular clarifying the assessment practice till 31-12-2008, where the FOB value was to be treated as cum-duty price. The Tribunal emphasized the need for uniformity in assessment practices across Customs Houses, rejecting the Revenue's argument that the Circular applied selectively. Consequently, the Tribunal found merit in the applicant's argument for total waiver of pre-deposit dues, staying the recovery during the appeal process.

4. The Tribunal noted the amendment to Section 14 of the Customs Act introducing the concept of transaction value and the Circular's clarification on assessment practices. The decision highlighted the importance of adhering to policy decisions by the Apex Body to ensure uniformity and certainty in taxation, ultimately ruling in favor of the applicant for waiver of pre-deposit and stay on recovery during the appeal period.