1. M/s. Sapt Textiles Products (India) Pvt. Ltd., hereinafter referred to as the exporter, filed a revision application against the Order No.C27/161/74, dated 27th November, 1976, passed by the Appellate Collector of Customs, Madras, which has been transferred to the Tribunal as an Appeal under Section 131-B of the Customs Act, 1962.
2. The exporters were issued a demand notice intimating that the assessments in respect of the shipping bills for the period 1st September, 1969 to 31st October, 1970, had been finalised and that there was a short levy of Rs. 11,209.54. The exporter resisted the recovery and the assessment finally framed on the ground that commission paid by the exporter to the foreign agents was to be deducted from the valuation of goods for purposes of assessment notwithstanding the provision of Section 14. A separate ground was also taken that since the Bond could not be said to have been continued, short levy recovery was beyond the competence of the Customs Authorities. The second ground was rejected by the Appellate Collector of Customs by observing that in terms of Section 28 of the Customs Act the limitation commences from the date of adjustment of duty after final assessment only and since the final assessment was made in October 1973, the question of limitation under Section 28 did not arise. This aspect we are mentioning because, though it is agitated in the revision petition, Shri R.G. Sheth, Advocate, appearing for the exporter, specifically submitted that he was under instructions to press the appeal only on one ground and that was in relation to interpretation of Section 14. Therefore, we are not referring to the Memorandum of Revision/Appeal.
3. There is no dispute as to the price which was charged by the exporter from their buyers. The contention, however, is that the foreign agents' commission should be adjusted from the assessable value of goods exported.
4. One of the contentions of the exporters before the lower authorities was that in October 1970 a Public Notice No. 64/70 was issued by the Central Board of Revenue which stipulated that the price of sale for export would be the price inclusive of foreign agents' commission and that assessment would be made on such inclusive price. We were informed that before the issue of the said Trade Notice, the Cochin Customs authorities were allowing deduction of foreign agents' commission while arriving at the assessable value of exports of the like exported by the appellant in the present case, i.e. cotton waste. This contention was not pressed before us. However, in our considered view, the plea is entirely unfounded because, in the first place, the Trade Notice only clarified the position under Section 14 of the Act and cannot be said to have changed any statutory provision and in particular the concept of Section 14 of the Act.
5. Under Section 14 of the Act, "the price for purpose of assessment is the price at which goods are ordinarily sold, or offered for sale, for delivery as the case may be, in the course of international trade, where the seller and the buyer have no interest in the business of each other and the price is the sole consideration for the sale or offer of sale".
6. Section 14 of the Act talks of Price paid by the buyer. The Trade Notice issued on 24-11-1970 also mentioned the price paid by the buyer.
In the present case, the commission indicated in the invoice is paid by the exporter and hence the Trade Notice was not applicable, if at all it had some implication.
7. Besides, we have no hesitation in saying that the Trade Notice issued in November 1970 supra only clarified the position of Section 14 of the Act so as to set at rest any doubt, if one could be said to have been entertained by some Customs Officers. Therefore, according to us, the short levy demand of Rs. 11,209.54 came to be correctly raised and there is no dispute or agitation regarding the calculation as such.
8. Shri R.G. Sheth, on a query from the Bench, informed that after November 1970 even the exporters have not agitated and for purpose of assessment the commission paid to foreign agents is not claimed as a deduction from the value of goods which is offered to the buyer.
9. For the Revenue, we had the assistance of Shri Kunnikrishnan, 3r.
D.R. who made a short effective reply by submitting that the agitation raised by the exporter was unnecessary and avoidable litigation.
Considering that any lengthy discussion in the case is not called for and that there is no substance in the appeal, it is dismissed on the ground that any other view than the one taken by the Revenue Authority in the present case would have been wrong.