Iron Ore Export- CRCL/Customs Lab report cannot be basis for Final Assessment

Commissioner of Customs (Preventive) Vs Essel Mining & Industries Limited (CESTAT Kolkata)

Revenue is of the view that the Load Port sample analysis report issued by Mitra S.K. Private Ltd. may not be considered as true representative, but the sample which was forwarded to CRCL, Kolkata is the true representative sample because the Appellant never questioned about the method of drawal of samples.

As per Exporter- the Export duty is required to be calculated on the basis of Fe Contents, moisture and other impurities etc. arrived as per Test Report either at Discharge Port or Load Port, as per the terms of contract with foreign buyer, issued by NABL Accredited Testing Agency ‘Mitra SK Pvt. Ltd.’  at Load Port or CIQ at Discharge Port or Load Port as mentioned in the contract. The same is binding on buyer and seller both and become the basis of Final Invoice for Fe contents, Moisture and other impurities, as well weight etc. and other adjustments as required to be made for Bonus and penalties etc. For arriving final price both the S/Bills.

The Final Invoice has been issued based on Load Port Report issued by ‘Mitra SK’ which has been accepted by the buyer and basis which export remittance has been made and received, duly supported by Bank Realisation Certificate and a Certificate issued by an Independent Chartered Accountant. He further submitted that the Final Invoice Price and value of Final Invoice had been arrived as described above based on Fe contents @57.14% DMT basis i.e. below 58%, which has never been objected by Department, in such case proposing of levying Export duty treating Fe contents more than 58% basis CRCL report would be contradictory itself, as the export proceeds was paid for Fe contents below 58%.

As per Exporter the CRCL Report cannot have any role in deciding the Transaction Value as well as Fe Contents to be considered for Final Assessment and for charging of Export duty, otherwise it would be against the spirit of Transaction value to be decided under Section 14 of Customs Act and Circular No 12/2014 dated 17.11.2014.

As per CESTAT-

• The sample should be drawn and tested as early as possible and if testing of the sample by the CRCL and the number of days taken by the NABL accredited Private Labs are much lesser in that case, Test Report issued by NABL accredited agency will prevail over CRCL report and CRCL cannot be considered. Accordingly, In both the cases, the values arrived at by the Government Recognized Private Laboratories‟ Reports are likely to be more accurate, since they had completed the Testing nearer to the date of drawing of samples. The decisions of the cited case law are squarely applicable to the fact of the present case.
• As per Circular No. 12/2014 dated 17.11.2014, he Adjudicating Authority was also bound to give proper consideration to the fact that the overseas importer has made the payment based on the DMT Fe content as given by the private labs, which was not done in this particular case.
• we find no legal substance in the Order in Original of the Assistant Commissioner, and are of the view that he was in error of law in passing the impugned judgement.
• As per Section 14 of the Customs Act the value of the imported goods and export goods shall be the transaction value of such goods, that is to say, the price actually paid or payable for the goods. The paid or payable amount has to be derived or arrived based on terms of contract with Foreign Buyer, accordingly the transaction value of exported Iron Ore Fines shall be the amount realised from the Foreign Buyer as per terms of agreement. The Final Invoice against both the Shipping Bills has been issued, based on Test Report issued by Mitra S.K. Private Ltd., for the Fe contents @57.56 in dry metric ton i.e. ‘DMT’ and @51.97% in Wet Metric Ton. The same is as per the terms and condition of agreement for which the Department has not raised any dispute. In such case we are convinced that it would be contradictory to itself if the Export duty is demanded on such realised value treating Fe contents more than 58% as the realised value is for in both DMT and WMT state are below 58%.
  Now, the Customs officers cannot change this transaction value or the stipulation of the test report of Mitra S.K. Pvt. Ltd. being the determinant of the transaction value.In our considered opinion the report of Chemical examiner, CRCL is irrelevant to the transaction value and cannot be used for deciding and levy of Export Duty. It will be a different matter if the testing has to be done for some Customs purpose, say, to determine the nature of the goods etc. Thus, the impugned order of the Commissioner Appeals, rejecting the Order in Original for determining the Export Duty on the CRCL test report, does not have any infirmity.

FULL TEXT OF THE CESTAT KOLKATA ORDER

The present appeal has been filed by the Revenue against the impugned Order-in-Appeal No. 72/CUS/CCP/2023 dated 08.06.2023 passed by the Commissioner (Appeals), GST, CX & Customs, Central Revenue Building, Rajaswa Vihar, Bhubaneswar – 751 007, Odisha.

2. M/s. Essel Mining & Industries Limited (hereinafter referred to as the ‘Respondent’) have exported Iron Ore Fines vide two Shipping Bills viz. No. 9089712 dated 03.03.2021 and No. 9152539 dated 06.03.2021 and, declaring the Fe contents as 57.14% in DMT, which is less than 58% in DMT. Before shipment, samples were drawn by Customs officials, which was sent to the Deputy Chief Chemist Chemical Laboratory Customs House, Kolkata-700001 (‘CRCL’ for short) for testing. Based on the Test Report received from the CRCL, the Department issued the Show Cause Notice demanding export duty @30% of FoB on the ground that in both the cases, the ‘Fe’ content was more than 58% in DMT, whereas the Respondent-Company claimed that in all these cases, the Fe content was less than 58%, in DMT as well as in WMT.

2.1. After due process, the assessment was finalized by the Assistant Commissioner of Customs, Gopalpur Customs Division, Arjeepalli, Chattrapur, Odisha – 761020, vide Order-in-Original No. CUS/GCD/AC/118/SB/111 Dated 08.10.2021,demanding Export Duty @30%.

2.2. On appeal, the Ld. Commissioner (Appeals), Bhubaneshwar, vide the impugned order, has allowed the Appeal filed by the appellant (Respondent herein) on the ground that there is substantial delay of more than one month in testing the samples by CRCL and since the moisture content in Iron ore is prone to evaporation, the delay in testing resulted in evaporation of moisture content. Therefore, the Ld. Commissioner (Appeals) observed that the test report issued by Mitra S.K. Private Limited, which is a government approved NABL accredited agency, is required to be considered for determining Fe content of the exported Iron ore since, the same provides the more accurate Fe content of the exported Iron Ore Fines and thus set aside the said Order in Original with a direction to re-assess the subject goods under CTH 2601 1142, which relates to Iron ore fines having Fe content less than 58%, for both the Shipping Bills dated 03.03.2021 and 06.03.2021.

3. The Revenue is of the view that the Load Port sample analysis report issued by Mitra S.K. Private Ltd. may not be considered as the true representative, but the sample which was forwarded to CRCL, Kolkata is the true representative sample because the Respondent has never questioned about the method of drawal of samples.

3.1. The contention of the Revenue is that the Ld. Commissioner (Appeals) at no point of time has negated the test report of CRCL, Kolkata and not submitted evidence /information to prove that the test report submitted by CRCL, Kolkata is erroneous and cannot be accepted.

3.2. Accordingly, Revenue has filed this appeal praying for setting aside the impugned Order-in-Appeal No. 72/CUS/CCP/2023 dated 08.06.2023.

4. The Ld. Authorized Representative appearing on behalf of the Revenue submits that for the purpose of Export Duty calculation CRCL Report should prevail. Accordingly, he submitted that the Ld. Commissioner (Appeals) has erred in rejecting the CRCL report and allowed the appeal in favour of the Respondent. Thus, he prayed for setting aside the impugned Order-in-Appeal and allow the appeal filed by the Revenue.

5. The Ld. Chartered Accountant appearing on behalf of Respondent Submitted that the Export duty is required to be calculated on the basis of Fe Contents, moisture and other impurities, etc., arrived at as per Test Report either at Discharge Port or Load Port, as per the terms of contract with the foreign buyer. He states that in the present case, the Test reports issued by ‘Mitra SK Pvt. Ltd.’, which is a NABL Accredited Testing Agency, has been considered by the Ld. Commissioner (Appeals) for determining Fe content of the exported Iron ore since, the same provides with the more accurate Fe content of the exported Iron Ore Fines. The Respondent submits that the report submitted by Mitra SK Pvt. Ltd. is binding on both the buyer and the seller and thus it becomes the basis of Final Invoice for Fe contents, moisture and other impurities, weight, etc., and other adjustments as required to be made for Bonus and penalties, etc., for arriving final price in respect of both the shipping bills.

5.1. It is further submitted that in the present case, the Final Invoice has been issued based on Load Port Report issued by ‘Mitra SK’ which has been accepted by the buyer and is the basis on which export remittance has been made and received, duly supported by Bank Realisation Certificate and a Certificate issued by an Independent Chartered Accountant. He submitted in this regard that the Final Invoice Price and value of Final Invoice had been arrived at on the basis of Fe content @57.14% on DMT basis i.e., below 58%, which has never been objected to by Department. Accordingly, he submitted that proposing levy of Export duty by treating Fe contents as more than 58%, on the basis of CRCL report, would be contradictory to the terms contained in the contract, as the export proceeds were paid for Fe contents below 58%.

5.1. The Final Invoice issued on the Load Port Test Report, having Fe contents and moistures, is as below: –

5.2. The Ld. Chartered Accountant for the Respondent has further argued that the CRCL Report cannot have any role in deciding the Transaction Value as well as Fe Contents to be considered for Final Assessment and for charging of Export duty, otherwise it would be against the spirit of Transaction value to be decided in terms of Section 14 of Customs Act and the C.B.I.C. Circular No. 12/2014 dated 17.11.2014. He further submits that the CRCL Report is suffering from a delay of more than 35 days as against 4 days in case of Load Port Analysis Report issued by NABL Accredited testing agency ‘Mitra S.K. Private Limited’, on the basis of which the Final Invoice is issued. It is his submission that because of the delay, the gross weight of the sample got reduced due to evaporation of moisture; in such a case, the Fe contents on WMT basis (Gross weight) will definitely have impact on the higher side.

5.3. As the date of Export is prior to 1^st May 2022, i.e., the date of amendment to provide that the percentage of Fe (iron) content wherever specified shall be calculated on the Dry weight or Dry Metric Ton (DMT) basis, the Respondent contends that for the purpose of Export duty levy, the Fe contents are required to be considered in WMT basis. In such a case, it is submitted that the report issued by Mitra S.K. Private Limited would be more accurate being nearer to the sampling dates; hence, the same is more appropriate for considering the Fe contents, moisture, etc., for final assessment.

5.4. In support of his contentions, the Ld. Counsel for the Respondent has relied upon the following decisions: –

i. Vedanta Ltd. v. Commissioner of Customs (Prev.), Bhubaneswar [Final Order No. 76352 of 2023 dated 18.08.2023 in Customs Appeal No. 79383 of 2018 – CESTAT, Kolkata]

ii. Bagadiya Brothers Pvt. Ltd. v. Commissioner of Customs (Port), Kolkata [Final Order Nos. 76644­76645 of 2023 dated 15.09.2023 in Customs Appeal No. 75008 of 2021 & anr. – CESTAT, Kolkata]

iii. Bonai Industrial Co. Ltd. & ors. v. Commissioner of Customs, Visakhapatnam [Final Order Nos.A/30317-30324/2024 dated 21.06.2024 in Customs Appeal No. 25364 of 2013 & ors.=2024 (6) LCX 0074 – CESTAT, Hyderabad]

iv. Kutch Salt & Allied Industries Ltd. v. Commissioner of Customs, Vijayawada [Final Order Nos. A/30223­30224/2024 dated 01.04.2024 in Customs Appeal No. 21505 of 2015 – CESTAT, Hyderabad]

v. Moorgate Industries (I) Pvt. Ltd. v. Commissioner of Customs (Port), Kolkata [Final Order No. 77639 of 2023 dated 30.11.2023 in Customs Appeal No. 75506 of 2023 – CESTAT, Kolkata]

vi. Terapanth Foods Ltd. v. Commissioner of Customs, Vijayawada [Final Order Nos.A/30231-30232/2024 dated 05.04.2024 in Customs Appeal No. 22188 of 2015 – CESTAT, Hyderabad]

6. Heard both sides and perused the appeal documents.

7. We observe that the question to be answered by us in this case is as to whether the CRCL Report is required to be considered for the purpose of Final Assessment of the Exported Iron Ore Fines. Accordingly, the issue to be decided is whether the Export Duty can be levied based on the test report of the Chemical Examiner of CRCL or not, when the Final Invoice / realised price is arrived at on the basis of the test report of a NABL Accredited Agency at Load Port or CIQ Report at Discharge Port or any other formula, as per the terms and condition of agreement between the buyer and seller.

7.1. We observe that this Tribunal has already decided in various cases that the Fe content, till the amendment made w.e.f. 1^st May 2022 vide the Finance Act 2022, is required to be calculated in WET basis by following the principles of law as laid down by the Hon’ble High Court at Bombay in the case of Union of India v. Gangadhar Narsingdas Agrawal & Anr. [1988 (33) E.L.T. 673 (Bom.)], which has been affirmed by the Hon’ble Apex Court as reported in 1997 (89) E.L.T. 19 (S.C.). As both the subjected Shipping Bills were filed prior to 1^st May 2022, we observe that the determination of Fe content in the said Shipping Bills shall be governed by the principles of law laid down by the Hon’ble Supreme Court in its landmark judgment in the matter of. Gangadhar Narsingdas Agrawal (supra) wherein it has been held that whenever any samples are tested it has to be in the condition in which the goods are exported i.e. in Gross weight (WET state) by including the moisture and other impurities.

7.2. We also observe that the C.B.I.C., vide Circular No 04/2012-Cus. dated 17.02.2012, accepted the same and directed all the officers to follow such procedure. In the present case, we observe that the goods were exported in moist form whereas the report of the CRCL, Kolkata is apparently for the dry form. Thus, we observe that the report of CRCL is not relevant to this case.

7.3. We also observe that the above view is supported by Hon’ble High Court of Mumbai at Goa in a similar case, in V.M. Salgaocar & Brother P. Ltd. v. Assistant Commissioner of Cus. (Export) & ors. [Writ Petition No. 216 of 2022 vide Order passed on 23.09.2022], has observed that:

“50. …..

….the wet (WMT) method was consistently followed even after the new regime on the ad valorem basis was introduced w.e.f. 13 June 2008 for all these years from the time the principles of law recognizing the Wet method, had found approval of the Supreme Court in Gangadhar Agarwal’s case in the year 1995 (9 August 1995). It was not thought appropriate by the legislature to take any legislative steps to have a regime different from what was recognized and followed, as laid down in the said decision of the Supreme Court or in other words to substitute the Wet (WMT) method. This is clear from the fact that such modification from the Wet method to the Dry method, has been very recently introduced by an amendment which is brought about w.e.f. 1st May 2022…”

7.4. We observe that the following orders on this issue also supports the case of the Respondent: –

i. Vedanta Ltd. v. Commissioner of Customs (Prev.), Bhubaneswar [Final Order No. 76352 of 2023 dated 18.08.2023 in Customs Appeal No. 79383 of 2018 – CESTAT, Kolkata]

ii. Bagadiya Brothers Pvt. Ltd. v. Commissioner of Customs (Port), Kolkata [Final Order Nos. 76644­76645 of 2023 dated 15.09.2023 in Customs Appeal No. 75008 of 2021 & anr. – CESTAT, Kolkata]

iii. Bonai Industrial Co. Ltd. & ors. v. Commissioner of Customs, Visakhapatnam [Final Order Nos.A/30317-30324/2024 dated 21.06.2024 in Customs Appeal No. 25364 of 2013 & ors.=2024 (6) LCX 0074 – CESTAT, Hyderabad]

iv. Kutch Salt & Allied Industries Ltd. v. Commissioner of Customs, Vijayawada [Final Order Nos. A/30223­30224/2024 dated 01.04.2024 in Customs Appeal No. 21505 of 2015 – CESTAT, Hyderabad]

v. Moorgate Industries (I) Pvt. Ltd. v. Commissioner of Customs (Port), Kolkata [Final Order No. 77639 of 2023 dated 30.11.2023 in Customs Appeal No. 75506 of 2023 – CESTAT, Kolkata]

vi. Terapanth Foods Ltd. v. Commissioner of Customs, Vijayawada [Final Order Nos.A/30231-30232/2024 dated 05.04.2024 in Customs Appeal No. 22188 of 2015 – CESTAT, Hyderabad]

7.5. We observe that the matter is covered by the decision of this Tribunal in the case of Vedanta Ltd. (formerly known as ‘Sesa Sterlite Ltd./Sesa Goa Ltd.’) v. Commissioner of Customs (Prev.), Bhubaneswar [Final Order No. 76352 of 2023 dated 18.08.2023 in Customs Appeal No. 79383 of 2018 – CESTAT, Kolkata] holding that moisture content has to be taken into account for arriving the final Fe content.

7.6. This Bench, in many of the matters including the matter of Customs Appeal No.79383 of 2018 of M/s. Vedanta Ltd. (supra), mentioned above, have concluded that for carrying out the Final Fe contents, the sample should be drawn and tested as early as possible. In the present case, if the number of days taken by CRCL and the number of days taken by the NABL accredited Private Labs are considered, then the Test Report issued by the NABL accredited agency will prevail over the CRCL report as they have taken less number of days than CRCL. Accordingly, in both the cases, the values arrived at in the Reports by the Government Recognized Private Laboratories are likely to be more accurate, since they had completed the Testing nearer to the date of drawing of samples. As per Circular No. 12/2014 dated 17.11.2014, the Adjudicating Authority is bound to give proper consideration to the fact that the overseas importer has made the payment on the basis of DMT Fe content as given by the private labs, which was not done in this particular case.

7.7. We also find that this Tribunal in the case of Customs Appeal No. 75008 of 2021 and anr., vide its Final Order Nos. 76644-76645 of 2023 dated 15.09.2023 in the matter of Bagadiya Brothers Private Limited (Appellant) v. Commissioner of Customs (Port), Kolkata (Respondent) & anr., authenticated the undermentioned Formula for converting the Fe content on Wet basis,

Iron Content = Fe x (100-M)

100

Where Fe is the percentage of Iron content on dry basis and M is the moisture content in the sample.

It is observed that the proper officer has not considered any of the above and ignored the Circulars as well as directions issued in above mentioned decisions.

7.8. We also place our reliance upon the decision of the Hyderabad Bench of the CESTAT in the case of Kutch Salt & Allied Industries Ltd. v. Commissioner of Customs, Vijayawada [Final Order Nos. A/30223­30224/2024 dated 01.04.2024 in Customs Appeal No. 21505 of 2015 – CESTAT, Hyderabad] reported in (2024) 19 Centax 72 (Tri.-Hyd.). The relevant part of the said decision is reproduced below :-

“19. To examine this re-determination in the impugned order, we need to examine as to what is transaction value. Transaction value is the price paid or payable by the importer (buyer) to the exporter (seller) as a consideration for the goods which are exported. It is negotiated and agreed to by them in the contract. Nobody else, including the Customs officers have any role in deciding the transaction value because they are strangers to the contract. It determines the rights and liabilities between the buyer and seller………………. If the transaction value is contingent upon certain other factors as per the contract between them, it will have to be determined accordingly. Nobody else who is not a party to the contract, including the Customs officers have any right to add or delete or modify the conditions of the contract.”

(Emphasis supplied)

8. As regards the reports of CRCL, Kolkata, we observe that, in Shipping Bill No. 9152539 dated 06.03.2021, the Fe content in WMT is below 58%. In such a case, as per Notification No. 58/2022-Cus dated 18.11.2022, the Applicable Export duty is ‘NIL’ while classifying exported Iron Ore Fines under CTH 26011141. We find that the testing of Samples in CRCL at Kolkata has been done after a lapse of substantial number of days from the date of collection of samples. The details of Fe contents are as mentioned below: –

–

Considering the inherent nature of Iron Ore Fines exported, wherein the Moisture is subject to evaporation based on efflux of time i.e., time elapsed between date of testing and date of sampling, we observe that the moisture contents will be lower side in samples if the analysis is delayed from the date of collections of samples and bound to be different from a sample analysis made near to date of export. For deriving the Fe contents in ‘WET’ conditions, the moisture contents play a significant role and if moisture contents are reduced due to delay in sampling analysis, the same would results into higher Fe contents.

8.1. In sample Analysis of Shipping Bill No. 9089712 dated 03.03.2021, we observe that there is a substantial delay of 39 days while testing the Samples, from the date of collection of samples. We observe that the Fe content, as per CRCL Test report, was calculated after removing moisture and other impurities i.e., on DMT basis, which is against the ruling of the Hon’ble Supreme Court and directions issued by the C.B.I.C. We observe that the Test Reports relied on by the Respondent, on the basis of which the final Invoice was issued, had clearly certified that the Fe Content was 57.56% in DMT (below 58%) with moisture contents 9.71%. The Fe contents calculated on WMT basis come to 51.97%. The certificate produced by the Accredited Approved Inspection Agencies cannot be disregarded and is required to be accepted. We also observe that the issue is covered in favour of the Respondent in the cases of Alpine International v. Commissioner of Customs, Mangalore [2008 (224) E.L.T. 331 (Tri.-Bang.)], Mineral Enterprises Ltd. Vs Commissioner of Customs, Mangalore [2010 (253) E.L.T. 241 (Tri.-Bang.)] and General Nice Mineral Resources (I) P. Ltd. Vs Commissioner of Customs, Vijayawada [2017 (352) E.L.T. 94 (Tri. Hyd.)].

9. We further observe that as per Section 14 of the Customs Act the value of the imported goods and export goods shall be the transaction value of such goods, that is to say, the price actually paid or payable for the goods. The paid or payable amount has to be derived or arrived based on terms of contract with Foreign Buyer; accordingly, the transaction value of exported Iron Ore Fines shall be the amount realised from the Foreign Buyer as per terms of agreement. The Final Invoice against both the Shipping Bills has been issued based on Test Report issued by Mitra S.K. Private Ltd., for the Fe contents @57.56 in Dry Metric Ton i.e. ‘DMT’ and @51.97% in Wet Metric Ton. The same is as per the terms and condition of agreement for which the Department has not raised any dispute. In such a case, we are convinced that it would be contradictory to itself if the Export duty is demanded on such a realised value by treating Fe content as more than 58% as the realised values stated, in both DMT and WMT, are below 58%.

9.1 The C.B.I.C. has also directed vide Circular No. 12/2014 dated 17.11.2014, the Transaction value is to be decided based on the load port test report or discharge port test report, as per terms of contract, where the proper officer shall compare the two reports as per the terms set out in the contract and finalize the provisionally assessed shipping bills, under the provisions of Section 14 of the Act and the Customs Valuation (Determination of Value of Export Goods) Rules, 2007 duly, supported by Bank Realisation  Certificates for the purposes of comparison with the final invoices.

9.2. From the Circular, we observe that it has been clearly clarified that the Assessments are to be Finalised on the basis of the above said Circular only. As per the said Circular, Finalisation is to be done on the basis of the following: –

1) for ascertaining its quality and price  

i) Test Report at Load Port

ii) Test Report at Port of discharge

2) The commercial contracts governing its sale, contain provisions to adjust the amount payable depending upon the test report at the port of Load.

3) prices are to be finally determined after tests at Load port or discharge Port as per terms of contract.

4) The declared value of the export goods shall be scrutinized in relation to the provisional invoice, contract, weight, price, etc.

5) in terms of the provisions of Section 14 and the Customs Valuation (Determination of Value of Export Goods) Rules, 2007.

6) The Custom Houses shall monitor receipt of Bank Realisation Certificates for the purposes of comparison with the final invoices submitted by the exporter to satisfy the accuracy of assessed values.

9.3. We observe that Clauses 7 and 8 of the Contract mentions that the Load Port test report results have become final for determining the Fe, Moisture and other contents / impurities for the purpose of issuance of final invoice and accordingly, the final invoice is issued and remittance of export proceeds received from foreign buyer, which is duly supported by BRC.

9.4. The valuation of Exported Iron Ore Fines has to be derived based on terms of contract with Foreign Buyer and as per the Contractual agreement. Accordingly, we find that Load Port Test Report / Test Certificate in the present case would be the decisive factor for the determination of the iron content in the export product. This stand is substantiated by the fact that the remittance has also been received in proportion thereof only. Accordingly, the Fe contents of 57.56% in DMT as per Test Report of Load Port i.e., below 58%, is required to be honoured, which is the basis on which the price payable or paid had been arrived, Final Invoice is issued and export remittances are received i.e., Transaction Value under Section 14 of the Customs Act for the exported Iron Ore Fines. We observe that the Customs officers cannot change this transaction value or the stipulation of the test report of Mitra S.K. Pvt. Ltd., being the determinant of the transaction value.

10. In view of the above discussions, we are of the view that the report of Chemical examiner, CRCL, Kolkata cannot be used for deciding and levy of Export Duty. Thus, we do not find any infirmity in the impugned order of the Ld. Commissioner Appeals, rejecting the Order in Original for determining the Export Duty on the basis of the CRCL test report.

11. We further observe that there is no allegation of fraud or mis-declaration made out in the facts of the present case. As per Section 14 of the Customs Act, the value of export goods shall be the transaction value i.e., the price actually paid or payable for the goods when sold from India for delivery at the time and place of exportation (FOB Value).

11.1. Based on the law as laid down, referred to in earlier paragraphs, we find no legal substance in the Order in Original of the Assistant Commissioner, and hold that there is no infirmity in the impugned order passed by the Ld. Commissioner (Appeals). Accordingly, we hold that the appeal filed by the Revenue is devoid of any merits and liable to be dismissed.

12. In view of the above discussions, we uphold the impugned order and reject the appeal filed by the Revenue.

(Operative part of the order was pronounced in open court)