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TMI Blog2024 (4) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... he shipment exposed to moisture. The moisture over and above permissible was found at the port of discharge and price was renegotiated and the fresh price was arrived at to avoid termination of contract due to slightly higher moisture content. Situation to that extent was similar to the contract of M/S. ORE CASE (INDIA) V/S. COMMISSIONER OF CUSTOMS, CENTRAL EXCISE S.TAX, BBSR-I AND COMMISSIONER OF CUSTOMS (PREVENTIVE), BHUBANESHWAR[ 2023 (10) TMI 757 - CESTAT KOLKATA] Excepting that instead of humidity element it was ferrous content in that case. It is to be noted in that case, it is on record that assessment at the time of exportation was on provisional basis and subjected to the final outcome of ferrous contents. The ferrous contents in any case cannot be different, in normal course at either of the ports of export and import. However, in this case, it is not coming on records, as to whether the assessment was provisional, or whether the department was made aware of likely variance in prices due to higher moisture content which is likely to happen even in course of shipment being in the sea. Further whether any moisture content was declared in India at the time of export is not f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lable later. Moreover, instead of export of 55,000 Wet Metric Tonne of bauxite, the appellant actually shipped only a quantity of 54,600 Wet metric tonne and therefore, there was a short shipment of 400 mt of bauxite in the said consignment. This short shipment was duly certified vide the Short Shipment Notice No. 54 dated 08.03.2013 issued by the Superintendent of Customs, Porbandar. Thus, on account of aforesaid errors, excess customs duty came to be discharged by the appellant in the export of aforesaid consignment. 2. Now, in view of the short shipment of 400 mt of bauxite, the appellant initially vide letter dated 01.04.2013 filed a refund claim of Rs. 67.731/- towards the excess amount of duty paid by them on short shipped quantity. However, the said refund claim came to be returned back to the appellant with a query memo dated 12.04.2013 pointing out various discrepancies in the refund claim. Subsequent to the filing of the aforesaid refund claim, an amended invoice dated 19.04.2013 was issued by the appellant, in view of the final determination of the correct weight of the subject consignment in Dry Metric Tonne basis at the port of discharge by SGS China vide certificate d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her the refund claim of Rs. 12,66,148/- was considered by the adjudicating authority or not. Moreover, it is also a matter of fact on record that no show cause notice has ever been issued to the appellant raising dispute regarding the eligibility of the refund claim filed by the appellant. In this scenario, the Commissioner (Appeals) had no jurisdiction to unilaterally reject the refund claim of Rs. 12,66,148/- without putting the appellant to notice of the grounds and objections relied upon by the appellate authority while rejecting the refund claim in the final order. If the appellate authority was inclined to decide the eligibility of refund claim by himself, then the doubts or objections against the eligibility of the refund claim should have been communicated to the appellant, so as to enable them to justify and explain the calculation of refund entitled to the appellant. Such objections were never communicated to the appellant either during the pendency of appeal or during the course of personal hearing in this appeal. On the contrary, without adhering to such settled principles of adjudication, the appellate authority has unilaterally taken up the issue of eligibility of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the value of consignment supplied to the foreign purchaser was required to be calculated in terms of its Dry Metric Ton weight and accordingly, even the customs duty was required to be discharged by the appellant on such value. However, at the time of export of the subject consignment, the appellant mistakenly recorded the Wet Metric Tonne weight of 55,000 Mt of Bauxite in their provisional invoice. This error was also incorporated in the shipping bill and accordingly, the appellant erroneously discharged customs duty of Rs. 93,12,977/- on the FOB value of Rs. 9,04,17,250/- (i.e. 16,77,500 USD) which was calculated on the total weight of 55,000 Wet MT instead of its weight in Dry Metric Tonne. It was only at the port of discharge and on the basis of certificate issued by SGS China dated 15.04.2013, that the correct weight of the subject consignment in Dry metric Tonne basis was ascertained and the amount payable was determined for the said quantity of bauxite. Thus, in the present case. undisputedly the quantum of duty paid by the appellant had been Rs. 93,12,977/-; whereas the correct duty payable on the subject transaction was only Rs. 79,79,097/- and therefore, the appellants we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciples of natural justice and reasoned order in the matter. The advocate for the appellant relies on the following judgments, inter alia to emphasise that transaction value in case export of goods has been accepted to be for the weight as found at the port of disembarkation and therefore transaction value has to be construed accordingly and refund allowed to them. M/s. ORE CAST (INDIA) V/s. COMMISSIONER OF CUSTOMS, CENTRAL EXCISE S. TAX, BBSR-I AND COMMISSIONER OF CUSTOMS (PREVENTIVE, BHUBANESWAR V/s. M/s. ORE CAST (INDIA) as reported in 2023 (10) 757 CESTAT KOLKATA. He also pleaded that at this stage of litigation and in any case department cannot be allowed to raise requirement of challenging Bills of Entry as is now the requirement after ITC case, in case matter is remanded, department should not be allowed to take a ground that assessment order while making refund was not challenged. Also as part of the refund has already been sanctioned by the department without raising such objection and that decision in the case of ITC of the Hon ble Supreme Court as reported in 2019 (368) ELT 216 (S.C) became available later. Further he specifically relied upon the decision of the Division ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parties under the contract that was to be the basis. Therefore instead of initial shipped quantity from the port of embarkation i.e. Porbandar of 54,600 of Metallurgical Grade Gibbstic Bauxite of Indian Origin , quantity of 48372.209 MT was found alone after reduction of stated moisture content by Agency of SGS. It is to be noted that description given in various documents in the port of export was Metallurgical Grade Gibbstic Bauxite of Indian Origin . Learned Commissioner (Appeals) also noticed that the goods exported, there was no Mate s receipt of short shipment receipt at the port of discharge, to justify the reduced quantity of 48372.209 MT as claimed by the appellant. The appellants claim to the quantity based on the contract entered into by them with their importer party which allowed them to arrive at the revised price based on Dry Weight. The relevant condition of contract entered relating quantity is culled out as follows:- 1. Quantity The Buyer hereby agrees to buy from the Seller and the Seller agrees to sell to the Buyer, 1 shipload of 70,000.00 Metric Tons 10% , shipping tolerance, of Bauxite, on FOBST basis during February 2013. The +/- 10% shipping tolerance to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The definition of export goods and export has been given in Section 18 and Section 19 of the Customs Act, 1962 reads as follows:- (18) export , with its grammatical variations and cognate expressions, means taking out of India to a place outside India; (19) export goods means any goods which are to be taken out of India to a place outside India; 7.1 The transaction value in relation to export goods as available in Section 14 of the Customs Act, 1962 as follows : 14. Valuation of goods. (1) For the purposes of the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force, the value of the imported goods and export goods shall be the transaction value of such goods, that is to say, the price actually paid or payable for the goods when sold for export to India for delivery at the time and place of importation, or as the case may be, for export from India for delivery at the time and place of exportation, where the buyer and seller of the goods are not related and price is the sole consideration for the sale subject to such other conditions as may be specified in the rules made in this behalf: PROVIDED that such transaction value in the case of imported goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was ferrous content in that case. It is to be noted in that case, it is on record that assessment at the time of exportation was on provisional basis and subjected to the final outcome of ferrous contents. The ferrous contents in any case cannot be different, in normal course at either of the ports of export and import. However, in this case, it is not coming on records, as to whether the assessment was provisional, or whether the department was made aware of likely variance in prices due to higher moisture content which is likely to happen even in course of shipment being in the sea. Further whether any moisture content was declared in India at the time of export is not forthcoming. Again it has to be decided as to what was the export goods at the time of exportation and what was the price at the time of exportation as per the statutory provisions, indicated above. Matter is therefore, remanded back to the original adjudicating authority to check up on all these facts specially if the assessment was provisional or department was aware of the contract which provided for variance in price at the later stage. Further, since the department has not raised the issue initially that appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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