2012 (6) TMI 177 - AT - Customs

Differential duty imposed, calculated on the basis of higher density of the furnace oil declared and found - Revenue contended that if any difference in the density of the furnace oil which has been declared and as found in the test report is noticed, the assessee has received the higher quantity based on volume of the furnace oil and thus liable for differential duty - Held that - Duty liability for the goods imported in a country will depend upon the invoice value at the time of importation of the goods, irrespective of their being shortage of quantity or otherwise, therefore, first appellate authority rightly waived differential duty imposed. See Mangalore Refinery & Petrochem Limited vs CCE (2006 (2) TMI 518 - CESTAT, BANGALORE)- Decided in favor of assessee

Summary

Issues:
Whether the respondent assessee correctly discharged customs duty on imported furnace oil during a specific period.

Analysis:
The appeals were filed by the Revenue against the order in appeal Nos. 107 to 117/JMN/2006 dated 29.6.2006. The respondent assessee had imported furnace oil during 2001-2002, paying duty based on Bill of Lading, Invoice value, and Ullage report. The density of the oil was found slightly higher than declared, leading to a demand for differential duty. The Commissioner of Customs reviewed and filed an appeal after the first appellate authority rejected the proceedings initiated against the assessee.

The main issue was whether the respondent assessee correctly discharged customs duty on the imported furnace oil. The duty was paid based on the transaction value with the supplier, as per invoices produced before the authorities. The first appellate authority referred to a CBEC Circular stating that duty should be based on the invoice price paid, irrespective of the quantity ascertained through measurement. The contract terms did not require extra payment for variations due to higher density.

The Tribunal found that the duty liability for imported goods depends on the invoice value at the time of importation, regardless of quantity discrepancies. The lower authorities and the Tribunal concurred that the duty was correctly discharged by the respondent assessee. The appeals filed by the Revenue were rejected as the impugned order of the first appellate authority was deemed correct and legally sound, without any infirmity.