Full Judgment
1. The appellants imported Extrusion Sheet Manufacturing Equipment for production of multiplier plastic sheets. The goods were transferred from one division of the appellants to another of the same company on high sea sales basis. While assessing the goods, 3% of the value was loaded to the invoice value and duty charged on the basis that the commission charges are liable to be included in the assessable value in respect of goods which are sold on high sea sales basis. In appeal, they sought refund of the duty paid on the 3% which was loaded to the value. The refund application was rejected by the A.C. However, in appeal, it was held that the addition of 3% may be high and it could be reduced to 2% of the CIF value. In the present appeal, it has been contended that only US $ 500 i.e. Rs. 18,350/-had been charged "towards re-imbursement of actual documentation and communication expenses" as is evident from their letter dated 27-12-1996. The appellants have contended that there was no justification to make an addition towards commission while assessing the goods, as the import was not through a commission agent. In any event, there was no justification to make addition over and above the US $ 500, which was the actual amount charged while transferring the machine. Learned D.R. submits that the practice of adding commission to the value of the imported goods is normally in the case of canalised goods which are sold on high sea sales basis by MMTC and other canalised agencies. That practice also remains confirmed by the order of the Tribunal in Godavari Fertilizers & Chemical Ltd. v. CC, Visakhapatnam reported in 1996 (81) E.L.T. 535 (T).
2. In the facts of this case, it is admitted that the only amount charged while transferring the machine on high sea sales basis was US $ 500 i.e. Rs. 18,350/-. The addition of 3% by the Customs authorities or 2% as ordered in the impugned order would be to make an addition on a uniform basis, without, any regard to actual cost or commissions. We are of the opinion that there is no justification for such an addition.
It is, therefore, ordered that duty collected on the added amount over and above Rs. 18,350/- should be refunded to the appellants. The appeal is allowed on the above terms.