In favour of Bharat Petroleum Corporation, the Ahmedabad Bench of the Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) has held that Customs duty is leviable on actual receipt of the shore tank quantity.
The appellant imported bulk liquid cargo of Motor Spirit (MS), on 22.06.2011 and the question is whether custom duty is payable on the value determined on the quantity received in Shore Tanks as claimed by the Appellants or on transaction value based on the invoice price of the overseas suppliers, as held in the impugned order.
It was settled that the levy of customs duty under Section 12 is only on goods imported into India. Goods are said to be imported into India when they are brought into India from a place outside India. Unless such goods are brought into India, the act of importation which triggers the levy does not take place. If the goods are pilfered after they are unloaded or lost or destroyed at any time before clearance for home consumption or deposit in a warehouse, the importer is not liable to pay the duty leviable on such goods.
Under Section 14 of the Customs Act, when goods are to be valued for assessment, such valuation is only when the goods are ordinarily sold or offered for sale for delivery at the time and place of importation in the course of international trade.
It was observed that under the Customs Act, the levy of import duty cannot take place until goods are imported, that is, brought into India. It was the number of goods brought into India alone that attracts the levy of import duty. The quantity of crude oil received into a shore tank in a port in India should be the basis for payment of customs duty.
It was observed that the quantity of crude oil received into a shore tank in a port in India should be the basis for payment of customs duty. A Coram comprised of Mr Ramesh Nair, Member (Judicial) and Mr Raju, Member (Technical) held that the appellant’s claim of payment of Customs duty on quantity received in shore tank is correct and legal and revenue claim of duty payment on transaction value based on invoices of all overseas suppliers is not sustainable. The Tribunal set aside the impugned order and allowed the appeal.
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