COMMISSIONER OF CUSTOMS Vs. LUCKY STEEL INDUSTRIES

JUDGEMENT

(1.) THESE appeals have been filed by the applicant Commissioner against the order -in -appeal passed by the lower appellate authority allowing reduction in value for customs duty determination based on the addendum to the original memorandum of agreement between the seller and the appellant -importers for purchase of the impugned vessels for scrapping. The respondents have asked for adjournment, which is declined as it is felt after hearing the learned SDR for sometime that the matter is required to be referred to a Larger Bench in view of the conflicting decisions by different co -ordinate Benches of the Tribunal.

(2.) THE learned DR arguing on behalf of the department states that in the following orders passed by different Benches of the Tribunal, it has been held that variation in the value of the vessels through addenda to the memoranda of agreement, which reduce the value, cannot be allowed for the purposes of customs valuation: - (i) CC, Ahmedabad v. Guru Ashish Ship Breakers . (ii) CC, Jamnagar v. Shree Ram Steel and Rolling Industries 2005 (188) E.L.T. 30. (iii) CC, Jamnagar v. Chaudhary Industries . (iv) Chaudhary Ship Breakers v. CCE, Ahmedabad 2005 (191) E.L.T. 960.

(3.) WE find that in the case of Chaudhary Ship Breakers (cited supra), it has been held that the mutual reduction of price after import of goods into India by executing an addendum to the original agreement is not acceptable as no provision regarding price variation was there in the original memorandum of agreement. In the case of Chaudhary Industries (cited supra), it has been held that the original agreement for sale did not provide for reduction in price after finding of any discrepancy therein but only provided for arbitration, which was not taken recourse to and hence addendum to the agreement reducing price cannot be accepted. In the case of Shree Ram Steel and Rolling Industries (cited supra), it has been held that once the vessel entered the territorial waters of India, importation is complete and that any reduction in price after such an event has to be scrutinized carefully and the revised price cannot be the basis for valuation which has been arrived at after the vessel was imported into the country, hence the price indicated in the first MoA is to be considered as the customs value. In the case of Guru Ashish Ship Breakers (cited supra), it has been held that no provision was there in the original agreement for reduction in price for the reasons stated under the addendum and hence price of goods, as stated in the original agreement which was available at the time of import of goods, has to be accepted as the customs value under the Customs Valuation Rules, 1988. 3. We find that there are contrary decisions of other Benches of the Tribunal where under variation in value has been allowed on the basis of addendum to the original memorandum of agreement in the following cases: (i) CC, Ahmedabad v. Atom Manohar Ship Breakers Ltd. 2003 (156) E.L.T. 151. (ii) Jai Jagdish Ship Breakers v. CC, Jamnagar 2004 (177) E.L.T. 928. (iii) CCE, Rajkot v. Jai Bharat Steel Industries 2005 (192) E.L.T. 792 (Tri -Mum).