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Entitlement to refund of customs duty on import of Crude Calcium Borate (Colemanite). Analysis: The appeal before the Appellate Tribunal CEGAT, New Delhi revolved around the entitlement of the appellants to a refund of customs duty amounting to Rs. 27,465.39 concerning the import of Crude Calcium Borate (Colemanite). The appellants had imported 2,350 Metric Tonnes of the product, which was provisionally assessed based on a local invoice with an FOB value of US $166,850.00. Subsequently, a refund was granted after final assessment, but the importers filed a claim for a higher refund of Rs. 50,130.09, arguing that the value of the goods should have been calculated based on the net dry weight of 2252.945 M.T. at a specific rate per metric tonne. The dispute centered on the consideration of moisture content in the valuation of the imported goods. The Assistant Collector rejected the claim for a higher refund, emphasizing that the moisture content was inherent to the chemicals and the final FOB value should be calculated based on the total weight of 2,350 M.T. The lower appellate authority also dismissed the appeal, noting that the contract and provisional invoice did not account for average moisture content, and any adjustment made in the final invoice was deemed incorrect. The lower authority upheld the initial refund amount and denied the additional claim, leading to the appellants filing the present appeal. During the proceedings, attention was drawn to the clauses in the contract between the foreign supplier and the buyer, which outlined the quantity, price, premium/penalty, and payment terms. The contract specified a price per dry metric ton based on a certain percentage of B203, with provisions for premium or penalty based on deviations from this percentage. Moreover, clauses related to payment and sampling/humidity determination indicated that consideration was indeed given for average moisture content in the contract terms. The Tribunal, after a thorough review of the contract terms and the factual circumstances, concluded that the appellants were justified in their claim for a higher refund. The final invoice specified the net dry weight of the imported goods, deducting the moisture content, which differed from the total weight considered by the Customs authorities. Therefore, the Tribunal set aside the previous order and allowed the appeal, granting the appellants the entitlement to the refund of customs duty with consequential relief.
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