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Judgments

State of Himachal Pradesh vs Raj Kumar [HIMACHAL PRADESH HIGH COURT, 01 Dec 2011]

(1) Rakesh Arora; (2) Ashok Kumar Jha vs Commissioner of Customs [DELHI HIGH COURT, 22 Nov 2011]

Asian Global Limited vs Business Soul's Associates Limited and another [DELHI HIGH COURT, 01 Nov 2011]

Commissioner of Customs, Vishakhapatnam vs Aggarwal Industries Limited [SUPREME COURT OF INDIA, 17 Oct 2011]
Customs - Indirect Tax - Customs Valuation (Determination of Price of Imported Goods) Rules, 1988, rr. 4 and 10 A - Customs Act, 1962, s. 14 - Demand - Under-valuation - Respondent entered into a contract with 'X' for import of 500 Metric tons of crude sunflower seed oil at the rate of US $ 435 CIF/Metric ton - As per the contract, the consignment was to be shipped in July, 2001 but as the mutually agreed time for shipment was extended to 'Mid August 2001' the goods were actually shipped on 5.08.2001 - Respondent filed bill of entry - On verification of the documents filed, the Adjudicating Authority noticed certain discrepancies in the shipment period - Revenue issued show cause notice alleging that when actual shipment took place, after the expiry of the original shipment period, the international market price of crude sunflower seed oil had increased drastically, and, therefore, the contract price could not be accepted as the 'transaction value' in terms of r. 4 of Rules - Adjudicating Authority confirmed the demand and ordered the respondent to pay the differential amount of duty - Appeal filed against said order was dismissed by the Commissioner - On appeal, Tribunal set aside the order of the Commissioner and held that there was no basis for demand of differential duty by ignoring the invoice price - Hence, the instant appeals - Whether order of the Tribunal could be upheld? - Held, in the instant case, admittedly the contract for supply of crude sunflower seed oil @ US $ 435 CIF/PMT was entered into on 26.06.2001 - It could not be performed on time because of which extension of time for shipment was agreed to between the contracting parties - It was true that the commodity involved had volatile fluctuations in its price in the international market but having delayed the shipment, the supplier did not increase the price of the commodity even after the increase in its price in the international market - Said fact was also proved by the actual amount paid to the supplier - There was no allegation of the supplier and importer being in collusion - It was also not the case of the revenue that the transaction entered into by the respondent was not genuine or under-valued - Nor was there a mis-description of the goods imported - Moreover, it was manifest from the show cause notice, that the contract value was not acceptable to the Adjudicating Authority in terms of s. 14(1) of the Act r/w. r. 4 of Rules merely because by the time actual shipment took place in August 2001, international price of the oil had increased drastically - No other reason has been ascribed to reject the transaction value u/r. 4(1) of Rules - The import instances relied upon by the revenue could not be treated as instances indicating contemporaneous value of the goods because contracts for supply of the goods in those cases were entered into almost after a month from the date of contract in the instant cases, more so, when admittedly there were drastic fluctuations in the international price of the commodity involved - Hence, order of the tribunal upheld - Revenue's appeals dismissed.

Royal Carbon Black Private Limited and another vs Chief Commissioner of Custom, Mumbai and others [BOMBAY HIGH COURT, 17 Oct 2011]

Noble Resources and Trading India Private Limited vs Union of India and others [BOMBAY HIGH COURT, 07 Oct 2011]

Caravel Shipping Services Private Limited, Represented by its Director, Saju Chacko vs (1) Shamim Darya Arya for Liberty, London; (2) Indus Resources Private Limited; (3) Green Land Sea Multi Cargo Shipping Agencies; (4) Mundhra Container Freight Station Private Limited [MADRAS HIGH COURT, 30 Sep 2011]

Brentfield Travels Company Private Limited vs Reserve Bank of India and another [BOMBAY HIGH COURT, 23 Sep 2011]

Agriculture Produce Market Committee Through Secretary vs State of Gujarat Through Secretary [GUJARAT HIGH COURT, 19 Sep 2011]

Dhank Juth Vividh Karyakari Sahakari Mandali Limited vs State of Gikarat Thro The Secretary [GUJARAT HIGH COURT, 15 Sep 2011]

Upleta Taluka Fal Ane Shak Bhaji Utpadak Sahakar Mandli Limited vs State of Gujarat Through Secretary [GUJARAT HIGH COURT, 15 Sep 2011]

Shree Rajkot District Co-Operative Bank Limited vs State of Gujarat Through Secretary [GUJARAT HIGH COURT, 15 Sep 2011]

Shree Khedut Fal Ane Shak Bhaji Utpadak Sahkari Mandali Limited vs State of Gujarat Through Secretary [GUJARAT HIGH COURT, 15 Sep 2011]

Tejus Proprietary Concern of Tejus Rohitkumar Kapadia vs Union of India and others [BOMBAY HIGH COURT, 07 Sep 2011]

State of Maharashtra and others vs Subhash Arjundas Kataria [SUPREME COURT OF INDIA, 26 Aug 2011]
Trade - Practice & Procedure - Standards of Weights and Measures Act, 1976 - Standards of Weights and Measures (Packaged Commodities) Rules, 1977, r. 2(I) - Packed commodity - Failure to declare the details of manufacturing - Seizure - Legality - 2nd appellant/Inspector of Legal Metrology seized five sun glasses from the shop of respondent for allegedly not declaring name and address of the manufacturer/month and year of manufacturing in the cover of sunglasses which was in violation of provisions of the Act and the Rules - Respondent alleged that by force they were compelled to write a letter to the authorities for compounding the offence and directing them to pay Rs. 3,000/- as compounding fee - Respondent filed writ petition challenging the order of seizure and order of compounding the offence - HC, by impugned order, allowed the writ petition holding that the sun glasses, whether it be a frame or glass was not a 'pre-packed commodity' within the definition of the expression 'pre-packed commodity' u/r. 2(l) of the Rules - Whether sunglass or its frame was 'pre-packed commodity' as per the Rules - Held, expression 'pre-packed commodity' would be applicable to commodities which were packed and the commodity packaged had a pre-determined value and that value should not be altered without the package sold being opened at the time of sale or the product underwent a modification on being opened - Further, Explanation I to r. 2(l) of the Rules was not attracted because the package was not opened for the purpose of testing as in the case of electric bulbs - On the other hand, sun glasses were tested by the buyer for his suitability, and therefore, sun glasses, whether it be a frame or glass was not a pre-packed commodity within the definition of the expression 'pre-packed' u/r. 2(l) of the Rules, hence, the HC was fully justified in quashing the notice and allowing the writ petition filed by the respondent - However, since the issue raised in the instant appeals was covered by a three Bench decision of SC in Whirlpool of India Ltd. v. Union of India and Ors., 2007 INDLAW SC 1090, the Registry was directed to place the appeals before the Chief Justice of India for listing before a larger Bench - Order accordingly.

State of Maharashtra and others vs Raj Marketing and another [SUPREME COURT OF INDIA, 26 Aug 2011]
Trade - Standards of Weights and Measures (Packaged Commodities) Rules, 1977, r. 2(x) - Wholesale package - Respondents, engaged in the business of buying and selling various products and store these products in their godowns - Department seized various packages of packed commodities from the godowns of the respondents on the ground that on the wholesale packets, the details regarding the name and addresses of the manufacturer, cost, month, year etc. had not been declared and also the retail sale price was not mentioned which was in violation of the Rules - Respondent filed writ petition for quashing the seizure memo - HC allowed said writ petition and held that the packages containing Candy man, Minto-Fresh, Kitchens of India, Badam Halwa and Ashirvaad Atta were not wholesale package within the definition of the expression 'wholesale package' u/r. 2(x) of the Rules - Hence, the instant appeal - Whether Candy man, Minto-Fresh, Kitchens of India, Badam Halwa and Ashirvaad Atta etc. can be considered as a 'wholesale package' within the definition of the expression 'wholesale package' u/r. 2(x) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977? - Held, a package used merely for protection during conveyance or safety would not be pre-packed commodity for the purpose of the Act and the Rules - As rightly observed by the HC that for the package to be treated as a wholesale package, the package must not be a secondary package - In that event, court have to find out whether the secondary package was only for safety, convenience or the like - In the instant case, the secondary outer packing for transportation or for safety of the goods being transported or delivered cannot be described as a wholesale package - Impugned order of the HC upheld - Revenue's appeal dismissed.

Victoria Marine & Agro Exports Limited, Represented by its Chairman, A. Dasnavis Fernando. vs Joint Director General of Foreign Trade, Office of the Zonal Joint Director General of Foreign Trade [MADRAS HIGH COURT, 19 Aug 2011]
Customs - Indirect Tax - Administrative - Copies of Directorate of Revenue Intelligence (DRI) report - Denial - Legality - Petitioner company was issued a Target Plus Scheme license for availing the incentive for export of various consignments - Respondent directorate issued a demand notice directing the petitioner to surrender the unutilized Target Plus license and directing the payment of customs duty together with interest for the utilization made - Petitioner sought representation seeking copies of DRI report - Respondent rejected petitioner's request on the ground that DRI report could not be provided, as they were copies of internal references, which related to investigation carried out by DRI and not pertinent to the issue - Hence the instant writ petition - Held, based on the records obtained from the petitioner's Bank, it was alleged that the export proceeds were realised directly by the petitioner and such proceeds during certain licensing year was higher than export performance during the subsequent year - Therefore, it was stated in the show cause notice that the petitioner was not eligible for duty credit benefit under Target Plus Scheme - It was evident that the show cause notice had been issued based upon the information furnished by the petitioner's bankers - It was an admitted fact that the copy of the letter written by the petitioner's banker to DRI along with its annexure had been furnished to the petitioner and the same had been filed by the petitioner in the typed set of papers - Hence, it was clear that the relevant bank records had been furnished to the petitioner - In such circumstances, the stand taken by the respondent in the impugned communication, appeared to be perfectly justified, as the petitioner was not entitled to, as a matter of right to seek for internal communications or inter departmental communications that to at the stage of show cause notice and more so when, such internal communication emanating from a specialized investigating agency - No arbitrariness or unreasonableness in the stand taken by the respondent and it was not a case, where there was violation of principles of natural justice - No case had been made out for interfering with the impugned communication - Petition dismissed.

Commissioner of Customs Excise, New Delhi vs Living Media (India) Limited [SUPREME COURT OF INDIA, 17 Aug 2011]
Indirect Tax - Customs - Customs Act, 1962, s. 14 - Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, rr. 2(f), 4 and 9(1)(c) - Assessable value - Imported Music Compact Discs (CDs) - Royalty - Respondent, engaged in the marketing of Audio Cassettes and CDs imported from 'X', who was a 100% subsidiary of 'Y' (Foreign Company) - As per the agreement entered into with the foreign collaborator the Indian company was required to pay royalty at the rate of 15% at the retail sale price of the goods to the foreign supplier - Since 'X' (importer) was a 100% subsidiary company, it was considered as a related person and the royalty payable by it to the supplier was considered to be as a condition of sale and therefore required to be included in the declared invoice value to the extent of royalty amount - Show cause notice issued to the appellant - Deputy Commissioner held that the value of the goods imported by the appellant was to be loaded by 15% as per r. 9(1)(c) of Rules, 1988 - Commissioner upheld the order of the Deputy Commissioner - Tribunal also dismissed appeal filed against said order - Hence, the instant appeal - Whether the royalty paid by the appellant to 'Y' on net sales in India can be added to the transaction value of Audio Compact Disc imported from 'X'? - Held, SC in Associated Cement Companies limited vs. Commissioner of Customs 2001 INDLAW SC 451, held that the if a pre-recorded music cassette or a popular film or musical score was imported into India, duty will necessarily have to be charged on the value of the final product - As per r. 9 of Rules, in determining the transaction value there has to be added to the price actually paid or payable for the imported goods, royalties and the license fees related to the imported goods that the buyer was required to pay, directly or indirectly, as a condition of sale of goods - Therefore, when pre-recorded music cassette was imported as against the blank cassette, definitely its value goes up in the market which was in addition to its value and therefore duty shall have to be charged on the value of the final product - Hence, value of the royalty paid was to be included in the transaction value - In the instant case, there was no dispute that the cassettes under question were brought to India as pre-recorded cassettes which carry the music or song of an artist - There was an agreement that royalty payment was towards money to be paid to artists and producers who had produced such cassettes - Such royalty becomes due and payable as soon as cassettes were distributed and sold and therefore, such royalty becomes payable on the entire records shipped less records returned - Appeals disposed of.

Commissioner of Customs, Office of the Commissioner of Customs vs (1) Sahul Hameed; (2) Joint Secretary, Government of India, Ministry of Finance, New Delhi [MADRAS HIGH COURT, 16 Aug 2011]

Patel Arunkumar Maganlal vs State of Gujarat [GUJARAT HIGH COURT, 11 Aug 2011]

(1) A. Mohammed Sitheeq; (2) K. Andal; (3) S. Kotravel; (4) S. Dhanasekaran vs (1) State of Tamil Nadu, Represented by its Secretary, Co-Operation Food And Consumer Protection Department; (2) Additional Director General Of Police Civil Supplies CID; (3) District Collector, Dindigul District; (4) Inspector of Police, Civil Supplies CID; (5) District Collector, Villupuram District [MADRAS HIGH COURT, 10 Aug 2011]

C. Ronald and another vs State, U. T. of Andaman and Nicobar Islands [SUPREME COURT OF INDIA, 10 Aug 2011]

Sujit Kumar Singh vs (1) Union of India, Through its Secretary, Ministry of Finance, New Delhi; (2) Commissioner of Customs (Preventive), Bihar, Patna [PATNA HIGH COURT, 09 Aug 2011]

Commissioner of Customs, New Delhi vs Kamal Bajaj [CUSTOMS EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, 09 Aug 2011]

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