ESSAR GUJARAT LTD Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE appellant entered into a contract for the delivery, as a buyer, of Iron Ore Pellets being manufactured by M/s. Kudremukh Iron Ore Co. Limited, Mangalore, an 100% Export Oriented Unit. They had filed refund claims totally amounting to Rs. 15,65,551/ - towards Central Excise duty paid on Port Charges at the rate of Rs. 18/ - per M.T. for the purchase of the said Pellets.

(2.) THE consequential refund, arising out of the valuation of the goods, purchased from an 100% E.O.U., was rejected by the Assistant Collector, as it was found that Port Charges were clearly indicated in the contract between buyers and sellers amounting to Rs. 18/ - per M.T. M/s. Kudremukh Iron Ore Co. Ltd. had given a break up of the same to be towards -

(3.) THE learned Commissioner (Appeals) came to the following findings - One has to be clear of the concept in arriving at the value of the goods in such cases as the one in question now. There is no import of the subject goods nor of identical nor similar goods and hence transaction value is not available. The value has to be determined as per Sec. 14 of the Customs Act, 1962 read with Rule 8 of the Customs Valuation Rules, 1988 by giving due adjustments as per the provisions contained in Rule 9 thereof. While arriving at the imported value all the expenses which are incurred till the goods are placed on the ship will have to be included in the value. The port charges being paid to the post authorities at the time of loading of the goods into the ship, therefore, will have to form part of the price. In fact Rule 9(2) (b) of the Customs Valuation Rules, 1988 provides for adding, loading, unloading, and handling charges associated with the delivery of the imported goods at the place of importation in determining the value. Accordingly, I find that the Asst. Collector is correct in disallowing port charges in determining the assessable value. After holding -