2008 (8) TMI 30 - SC - Customs

Includability of the charges paid for importation of design engineering and site run in the assessable value of the fermenter system - show cause notice was based on the invokability of Rule 9(1)(b) and Rule 9(1)(e) but Tribunal has failed to record a finding regarding applicability or otherwise of Rule 4, Rule 9(1)(b), Rule 9(1)(e) of Customs Valuation Rules and the assessment already made of design engineering and site run under Chapter 49 matter remanded

Summary

Issues:
1. Classification of goods under Customs Act, 1962
2. Includability of charges for design engineering and site run in assessable value of fermenters
3. Applicability of Customs Valuation Rules, 1988

Analysis:

1. The appellant was served with a show cause notice under Section 124 of the Customs Act, 1962, regarding the classification of fermenters and the potential recovery of duty. The issue of classification was raised as to whether fermenters should be assessed under Entry 8419.89 or 8479.89. The Tribunal decided against the assessee but the matter was remanded considering the benefit of a specific notification. As the issues of confiscation and penalty were decided in favor of the assessee and have attained finality, only the classification issue remains unresolved.

2. The only unresolved issue pertains to the includability of charges paid for design engineering and site run in the assessable value of fermenters. The show cause notice invoked Rule 9(1)(b) and Rule 9(1)(e) of the Customs Valuation Rules, 1988. The Tribunal did not consider these rules while deciding on the charges for design engineering and site run. The appellant argued that these charges had already been assessed separately under Chapter 49, which the Tribunal did not address. Since the Tribunal failed to determine the applicability of Rule 4, Rule 9(1)(b), Rule 9(1)(e), and the previous assessment under Chapter 49, the case has been remitted back to the Tribunal for a fresh decision on the includability of these charges.

3. The judgment ultimately sets aside the Tribunal's finding and instructs a re-decision on the includability of charges for design engineering and site run in the assessable value of fermenters in light of the relevant rules and previous assessments. The appeal has been disposed of accordingly, with no costs awarded.