2018 (11) TMI 1768 - AT - Customs

Valuation of imported goods - trailer parts viz. wheel rims, axle, suspension, etc. - goods was assessed provisionally as the proper officer intended to compute the levy of additional duties of customs by adoption of the maximum retail price. - applicability of Packaged Commodity Rules, 1977 to the goods that are not pre-packaged - HELD THAT - It is apparent from Section 3 of the Customs Tariff Act, 1975 that no provision exists for ascertainment of retail sale price in the same manner as provided for in Section 4A of Central Excise Act, 1944. The purpose of Section 4A of Central Excise Act, 1944 has been clearly articulated when it was incorporated in the statute. On the other hand, Section 3 of Customs Tariff Act, 1975 was intended to ensure that the valuation adopted for customs purpose, would have to conform to the price at which the goods are intended to be sold in packages that are statutorily required to carry such prices on them. Hence a declaration of retail sale price would suffice for acceptance as value for computation of additional duties of customs. The respondent herein has taken a position that the goods are not required, under the provisions of Standards of Weights and Measures Act, 1976 or the Rules made thereunder, to declare so on the packages of import. There is, therefore, no provision for determination of retail sale price in the event of disagreement by the proper officer of customs with the declaration - in the absence of declaration of retail sale price, the adoption of another price by the proper officer of customs does not constitute the appropriate assessment - there are no merits in the appeal of Revenue - appeal dismissed.

Summary

Issues:
1. Interpretation of Packaged Commodity Rules, 1977 in relation to the import of trailer parts.
2. Application of Section 2B of Standards of Weights and Measures Act, 1976 for declaring maximum retail price.
3. Validity of Notification No. 2/2006-C.E. (N.T.) and Notification No. 11/2006-C.E. in the context of automobile parts.
4. Exemption under Rule 2A of Packaged Commodity Rules, 1977 for industrial consumers.
5. Assessment of additional duties of customs under Section 4A of Central Excise Act, 1944.

Analysis:
1. The appeal by Revenue contested the provisional assessment of trailer parts imported by M/s. King Kaveri Trading Co. The first appellate authority set aside the assessing officer's order, stating that Packaged Commodity Rules, 1977 do not apply to non-pre-packaged goods.

2. The Authorized Representative argued that imported goods must adhere to declaring maximum retail price under Section 2B of the Standards of Weights and Measures Act, 1976. They also cited Notification No. 2/2006-C.E. (N.T.) and Notification No. 11/2006-C.E. to cover automobile parts.

3. The respondent's Counsel contended that the goods were not packed and were heavy, thus exempt from Rule 2B. They claimed the parts were used to manufacture products and not for automobiles covered by the notification.

4. The Tribunal found that the definition of 'commodity in packaged form' under the Weights and Measures Act covers goods distinguishable for sale. Industrial consumers, as per Rule 2A, are exempt from affixing maximum retail price.

5. The respondent admitted to the demand for additional duties under Section 4A of the Central Excise Act, 1944 but ceased the practice in 2009. The Tribunal referenced ABB Ltd. v. Commissioner of Customs, Bangalore to address the application of rules for assessing customs duties.

6. The Tribunal ruled that without a declaration of retail sale price, adopting another price by customs does not constitute proper assessment. As per Section 3 of the Customs Tariff Act, 1975, the valuation must align with the intended sale price on packages. The appeal by Revenue was dismissed due to the absence of a declared retail sale price.