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Customs Circular No. 26/2006 dated 26.9.2006
Subject: Includibilty of ship demurrage charges in the assessable value
regarding
Attention is invited to the Board’s Circular issued vide F.No.
467/79/2005-Cus.V, dated 12.01.2006 [Circular No.05/2006]
on the above subject, wherein, it was conveyed that all pending provisional
assessments in respect of importation prior to 02.03.2001 may be finalised by
not including ship demurrage charges in the assessable value in the light of the
Hon’ble Supreme Court judgement in the case of M/s. Indian Oil Corporation [2004
(165) ELT (SC)], as the Department’s Review Petition against the same was
dismissed.
2. It was further stated in the said Circular that with regard to the
period after 02.03.2001, clarification would be issued in due course. The Board
has examined the matter. In the aforesaid case of M/s. Indian Oil Corporation,
the Apex Court had held that the existing Departmental Circular would be binding
on the Department. The Board vide
Circular no. 14/2001-Cus.V dated 02.03.2001 had conveyed that ship demurrage
charges are required to be included in the assessable value of the goods under
Section 14 of the Customs Act, 1962, inter alia, by virtue of Rule 9 (2) of the
Customs (Valuation) Rules, 1988. Therefore, in the light of the aforesaid Apex
Court’s judgement, read with the Board’s aforesaid Circular no. 14/2001-Cus.
Dated 02.03.2001, all pending provisional assessments in respect of the
importation on or after 02.03.2001 should be finalised by including the ship
demurrage charges in the assessable value of the imported goods.
3. Similarly, the current assessments may also be finalised by including
the ship demurrage charges in the assessable value of the imported goods.
4. Receipt of the Circular may please be acknowledged.
Yours Faithfully,
(S.P.RAO)
UNDER SECRETARY TO THE GOVERNMENT OF INDIA
F.No.467/98/2005-Cus.V