U.C.
Banerjee and Y.K. Sabharwal, JJ.
VXL INDIA LTD.
COMMISSIONER OF CENTRAL EXCISE, RAJKOT
Civil Appeal No. 2728 of 1998, decided on 3-5-2001
Valuation
(Customs) - Metallurgical coke - Size of the coke discovered on testing not as
per the contract, at the plant site after the clearance on payment of customs
duty on the invoice value - Claim lodged with the supplier resulting in certain
diminution in the price - Revised agreement arrived at by the parties to avoid
litigation since there is no acceptance of diminution in value - Refund claim
filed on the basis of the revised invoice rejected by Tribunal - HELD : Revised
invoice was the result of the revised agreement between the parties and on this
factual count the Tribunal did not find any merit with the appeal - Tribunal’s
order upheld - Appeal dismissed - Sections 14 and 22 of Customs Act, 1962.
-There was no dispute regarding the valuation at the time of original assessment. Neither the testing was done in the presence of the customs authorities though loading, unloading and weighment, etc. were effected in their presence. Subsequently, however, the facts depict a refund claim has been filed on the basis of the revised invoice. The revised invoice obviously was the result of the revised agreement between the parties as noted above and it is on this factual count that the Tribunal did not see any merit with the appeal preferred before it. We also do not feel inclined to interfere with the reasoning and findings of the Tribunal, since we also do not see any merit in the appeal. [paras 3, 4]
[Order]. - This appeal is directed against the order of rejection of
appeal by CEGAT, Mumbai. The facts depict that the appellant had placed the
order of supply of 20,027 MT Metallurgical Coke of specified size with M/s.
Jenson & Nicholson Pvt. Ltd., Singapore at a stipulated price. According to
the invoice from the supplier the price of the consignment was shown as US $
2,143,524.85. The customs duty was assessed accordingly on the value shown in
the invoice and goods were cleared by the appellant on payment of the same.
Subsequently, however, on detailed inspection of the material at the plant
site, the appellant said to have discovered that the size of the metallurgical
coke was not as per the terms of the contract and as such brought them to the
notice of the representatives of the foreign supplier with the test report by
reason wherefore there was certain diminution in the price.
2.The Tribunal went into
the matter in great detail including the revised agreement between the parties
on account of materials said to have been defective. The relevant portion of
the revised agreement read as below :
“Differences
have arisen between the parties in relation to the quality and specifications
of the said coke supplied particularly about ash, moisture and size and whereas
Saukem (i.e. the appellants herein) allege they have suffered losses, and
whereas JNS (i.e. the suppliers) deny these allegations.
As
a result of discussions between the representatives of the parties hereto, it
has been amicably agreed, without any admission of liability by either party
that in consideration of both parties refraining from commencing or proceeding
with any legal action against the order in consideration, of the mutual
promises and convents contained herein and intending to be legally bound hereby
the parties hereto have reached an amicable agreement to settle all disputes in
accordance with the said contract and the said coke as follows ……..”
3.It is on the basis of the aforesaid that the Tribunal came to the conclusion that the revised agreement
cannot but be termed to be an agreement arrived at by the parties to avoid
litigation since there is no acceptance of liability of diminution in value.
4.Incidentally be it noted that there was no dispute regarding the valuation at the time of original assessment.
Neither the testing was done in the presence of the customs authorities though
loading, unloading and weighment, etc. were effected in their presence.
Subsequently, however, the facts depict a refund claim has been filed on the
basis of the revised invoice. The revised invoice obviously was the result of
the revised agreement between the parties as noted above and it is on this
factual count that the Tribunal did not see any merit with the appeal preferred
before it. We also do not feel inclined to interfere with the reasoning and
findings of the Tribunal, since we also do not see any merit in the appeal. The
appeal is, therefore, dismissed. No order as to costs.