CESTAT Upholds Quashing of Customs Duty Liability on Import of Barge on ground of Irregular Addition of Value of equipment on Board [Read Order]

The Mumbai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) upheld the quashing of Customs duty liability on the import of barge on the ground of irregular addition of the value of equipment on board. 

Lift & Shift India Pvt Ltd, the respondent assessee imported a barge, Aqua Float 300’, towed by tug, Fordeco 61, and the original authority imposed a penalty for confiscation of goods and demanded customs duty and the Commissioner of Customs (Export) quashed the customs duty liability upon the assessee. 

The revenue appealed against the order passed by the Commissioner of Customs for quashing the customs duty liability upon the assessee. 

S B Hatangadi, the counsel for the revenue contended that the value of the tug on the barge was proposed under rule 8 of Customs Valuation (Determination of Value of Imported Goods) Rules, 1988, to which the value of the equipment on board the barge was added and, by assigning value for other stores on board to demand differential duty. 

Further submitted that the addition of the value of equipment on board the barge was as per the law and liable to be sustained. 

Anurag Mishra, the counsel for the assessee contended that there was no duty liability, declaration as ‘old and used’ was merely a technical irregularity that confiscation was not warranted, and that the details of the tug had been properly declared, did not merit recourse to Customs Valuation (Determination of Value of Imported Goods) Rules, 1988 leaving only the freight component, admitted by the importer, to be added to the declared value. 

The Bench observed that the appeal of revenue ignored the fundamental and crucial difference between adjustment of the transaction value for cost and services and alternatives to the declared price upon rejection under rule 10A of Customs Valuation (Determination of Value of Imported Goods) Rules. 

The two-member bench comprising Ajay Sharma (Judicial) and C.J Mathew (Technical) upheld the decision made by the Commissioner of Customs while dismissing the appeal filed by the revenue. 

To Read the full text of the Order CLICK HERE

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