2014 (1) TMI 426 - AT - Customs

Duty demand - Import of aluminium dross - Liability for Additional Duty of Customs equal to Excise duty - Held that - value was enhanced on the basis of a circular which is in respect of copper dross and copper residues and after taking into consideration that the dross contains 50% of the aluminium. The Revenue is not relying upon any other import made by other importers for the same goods during the same period. The Commissioner (Appeals) also noted the fact that there was no reason given by the Adjudicating Authority for enhancement of the value. Further we find that the cost for extracting aluminium from dross cannot be equated with the cost of copper from copper dross and that circular cannot be blindly applied. In these circumstances we find no reason to reject the transaction value as declared by the appellants in the Bill of Entry in view of the decisions of Hon ble Supreme Court in the case of Eicher Tractors reported 2000 (11) TMI 139 - SUPREME COURT OF INDIA - Decided against Revenue.

Summary

Issues:
1. Appeal against assessment order for imported aluminium dross.
2. Dispute over Additional Duty of Customs.
3. Valuation of aluminium dross for assessment purposes.

Analysis:

1. The appeal was filed by the Revenue against an order setting aside an assessment order for aluminium dross imported by the respondents. The declared value was disputed by the Revenue, leading to an enhancement by the adjudicating authority. The Commissioner (Appeals) later set aside the enhanced value and the demands of Additional Duty of Customs.

2. The Revenue contended that the aluminium dross is liable for Additional Duty of Customs under the Central Excise Tariff. They argued that deductions for processing should have been allowed based on the percentage of aluminium in the dross. However, the Tribunal referred to previous judgments, including one by the Hon'ble Supreme Court, which clarified that similar products like zinc dross were not liable for excise duty. Consequently, it was held that aluminium dross is not subject to additional duty of customs.

3. Regarding the valuation of the aluminium dross, the enhancement was based on a circular related to copper dross and residues, considering the aluminium content in the dross. However, the Revenue failed to provide evidence from other importers during the same period. The Commissioner (Appeals) highlighted the lack of justification for the value enhancement. The Tribunal emphasized that the cost of extracting aluminium from dross differs from that of copper, and blindly applying the circular was deemed inappropriate. Citing a Supreme Court decision, the Tribunal upheld the transaction value declared by the appellants in the Bill of Entry, ultimately dismissing the appeal.

In conclusion, the Tribunal dismissed the appeal, affirming that the aluminium dross was not liable for additional duty of customs and that the declared transaction value should be accepted, given the specific circumstances and legal precedents cited during the case.