1997 (8) TMI 178 - AT - Customs

Summary

Issues:
1. Discrepancy in price paid for imported goods and prevailing market price.
2. Refund claim filed for duty paid on the original and reduced price.
3. Interpretation of Customs Valuation Rules regarding transaction value.
4. Comparison with a previous Supreme Court decision on assessable value.

The judgment involves a dispute where the appellants imported Monoethylene Glycol at a price of US $1050/MT C&F, later realizing the market price was lower. They obtained a price reduction of US $25/MT C&F from the suppliers and filed a refund claim for the duty paid on the original price. The Asstt. Collector rejected the claim citing the long-standing relationship between the parties and the actual price paid. The Commissioner (Appeals) upheld this decision, leading to the appeal.

The Tribunal noted that the goods were imported at the agreed price of US $1050/MT C&F, in accordance with the Supply Agreement. The Customs Valuation Rules dictate that the transaction value, i.e., the price actually paid or payable, should be considered for valuation. The subsequent price reduction, though due to the relationship, was included in the transaction value as it represented an amount already paid to the seller.

The appellants argued that the price reduction was due to identical goods being imported at a lower price. However, the correspondence revealed that the reduction was exceptional, not based on market prices. The Tribunal distinguished a Supreme Court decision where prices were negotiated prior to import, unlike the current case under the Customs Valuation Rules of 1988.

Ultimately, the Tribunal found no grounds to interfere with the lower authorities' decision. They rejected the appeal, emphasizing that the reduced price was not the ordinary selling price in international trade. The judgment highlights the importance of adhering to the transaction value for customs valuation, especially under specific valuation rules.