2007 (6) TMI 54 - AT - Customs

Valuation (Custom) - Department contented that appellant is declared the value of fuel oil diesel oil is of lower side and accordingly demand were made along with penalty - Held that the contention is not correct and set aside

Summary

Issues:
- Appeal by Department against the order of the Commissioner (Appeals)
- Declaration and amendment of value for fuel oil and diesel oil in the bill of entry
- Confirmation of prices by Commissioner (Appeals) based on IOC circular and actual remittance
- Consideration of evidence for contemporaneous import price and estimated bunker consumption price
- Legal sustainability of the order of Commissioner (Appeals)

Analysis:
The appeal before the Appellate Tribunal CESTAT, Ahmedabad was lodged by the Department challenging the order of the Commissioner (Appeals) regarding the declaration and amendment of value for fuel oil and diesel oil in a bill of entry. The appellant had initially declared values for fuel oil and diesel oil, but later sought amendments to lower values. The original authority confirmed the original prices claimed in the bill of entry, leading to the appeal.

The Commissioner (Appeals) upheld the prices for fuel oil and diesel oil based on US $ 168.39 per MT and US $ 247.76 per MT, respectively. This decision was supported by an IOC circular dated 7-3-2001 and the actual remittance made by the hirer for "bunker consumption price." The learned SDR reiterated the original authority's decision, while the advocate for the respondent strongly backed the Commissioner (Appeals)'s ruling.

Upon careful consideration of the submissions, the Tribunal noted that the fuel oil and diesel oil were not specifically imported and lacked support from any sale invoice. The vessel had sought permission to operate as a coastal run vessel, necessitating the payment of duty for the fuel oil and diesel oil on board. The declared values were deemed approximate, not reflecting the actual transaction price. The Commissioner (Appeals) relied on contemporaneous import prices by M/s. IOC and considered evidence indicating an estimated bunker consumption price of US $ 45,000 during the hire period.

In light of the circumstances and evidence presented, the Tribunal found the Commissioner (Appeals)'s decision to be reasonable and legally sustainable. The Department's appeal was dismissed as it failed to provide evidence of higher import prices for a comparable quantity. The Tribunal pronounced the dismissal of the appeal in court, affirming the decision of the Commissioner (Appeals).