2008 (6) TMI 64 - AT - Customs

Import of non-coking coal - Revenue proposed to enhance the said value on basis of contemporaneous import appellant submit that price is less because of import of higher quantity and payment of 90% amount immediately - no reasons advanced by Revenue to doubt the transaction value - no evidence that any extra money has flowed back to the foreign supplier of the goods contract of importer & supplier is detailed and there s no doubt n respect of contract Transaction Value acceptable

Summary

Issues:
Enhancement of declared price of imported coal based on comparison with another importer's price.

Analysis:
The appellant imported non-coking coal from South Africa at a declared price of USD 27.99 per metric ton, based on a contract with M/s. Glencore International AG. The Revenue sought to enhance the declared value by USD 1.55 per metric ton, citing the price of coal imported by another entity, M/s. Binani Cement Ltd. The appellant argued before the adjudicating authority that their consignment arrived in a larger ship, resulting in a lower price compared to Binani. They also highlighted differences in payment terms and quantity imported to justify their declared value.

The Deputy Commissioner rejected the appellant's arguments and enhanced the declared value. On appeal, the appellate authority acknowledged the marginal nature of the enhancement but found the appellant's justifications insufficient, leading to the impugned order. However, the appellate tribunal, after considering submissions from both sides, found no valid reasons to doubt the transaction value declared by the appellant. The tribunal noted the detailed contract with the foreign supplier, which accounted for various specifications and price adjustments based on coal quality. Importantly, there was no evidence of any extra money flowing back to the supplier, leading the tribunal to conclude that the transaction value should not have been rejected.

In light of the above analysis, the tribunal set aside the orders of the lower authorities and allowed the appeal, providing consequential relief to the appellant. The judgment emphasized the importance of respecting the transaction value unless there are concrete reasons to doubt its accuracy, highlighting the need for a thorough assessment based on contractual terms and factual evidence rather than arbitrary comparisons with other importers.