HYDERABAD INDUSTRIES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) The only question that arises for our consideration in these appeals is whether the service charges payable to Minerals and Metals Trading Corporation (for short 'the MMTC') by the appellant for the importation of raw asbestos made by them, is includible in the assessable value of import as provided in the Customs Act and Customs Valuation (Determination of Price) Rules, 1988 or not.

(2.) The appellant is a manufacturer of asbestos cement products for which it uses raw asbestos which is mainly imported from foreign countries. Under the provisions of the Import and Export Policy of the Government of India, the MMTC is designated as a canalising agent for the said purpose. The MMTC imports the raw asbestos in bulk purchasing the same from the foreign sellers. It then enters into sale agreement on what is known as high seas sales basis with the various users of raw asbestos. Consideration paid by the purchasers of the raw asbestos from the MMTC (which includes the appellant) includes apart from the purchase value incurred by the MMTC an additional sum equivalent to 3. 5 per cent of the C and F value of the imports as service charges.

(3.) On applications being made for refund based on a claim that service charges collected by the MMTC cannot be subjected to levy of customs duty, the appellant, who suffered adverse orders before all the authorities below including the Customs, Excise and Gold (Control) Appellate Tribunal, has preferred these appeals before us.