Pernod Ricard India(P) Ltd vs Commr.Of Customs, Icd Tughlakabad

5. Against show-cause notice dated 19th December 2000, the appellant filed a writ petition before the High Court of Delhi. Vide its order dated 27th August 2001, the High Court directed that the notice issued under Section 28 of the Act be treated as notice for finalization of the provisional assessment in terms of Section 18(2) of the Act. While disposing of the petition, the High Court observed that the authorities were free to decide as to whether any notice in terms of Section 111/124 of the Act was warranted. At the same time, the High Court granted liberty to the appellant to seek its remedy as per law in the event of issuance of such a show cause notice.

9. Pursuant to the order of the Tribunal, dated 25 th March 2003, the Commissioner passed a fresh order dated 29th August 2003 and held that Rule 6 was applicable on the facts of the instant case. He accordingly, confirmed the demand of duty of customs amounting to Rs.39.96 crores. The said order was again challenged by the appellant in the Tribunal, mainly on the ground that the value of imported CAB could not be determined under Rule 6. In the alternative, it was pleaded that even the quantification of the value under Rule 6 was seriously flawed.

10. Accepting the alternative submission of the appellant relating to the errors committed by the Commissioner while determining the assessable value of CAB on the basis of the transaction value of "similar goods", by its order dated 29th June 2005, the Tribunal again set aside the order of adjudication by the Commissioner and remanded the matter back to him with certain directions. Since the observations of the Tribunal contained in paragraphs 7 and 13 have some bearing on the merits of the rival stands on behalf of the parties, these are extracted hereunder:

13. Being dissatisfied with the order/directions of the Tribunal, as stated above, both the parties are before us in this appeal.

We direct that the adjustments on account of difference in retail prices shall be made in the manner prescribed below. The percentage of difference between the retail price of any brand of the appellant with the corresponding brand being compared shall be arrived at and to that extent the value of CAB of the competitor's import shall be reduced to arrive at the assessable value for CAB imported by the appellant. The above determination is subject to the following conditions:-

29. The appellant as well as the revenue are both dissatisfied with the said direction. The former claims that they should get discount of at least 40%. The stand of the latter, to the contrary, is that no demonstrated evidence, establishing the reasonableness and accuracy of the adjustment, having been adduced, the appellant is not entitled to any adjustment.

2. Having found a sale under any one of these three conditions adjustments will then be made, as the case may be, for :

36. In the result, the appeal preferred by the importer- appellant is dismissed and the revenue's appeal is allowed. The order of the Tribunal under appeal, in so far as it pertains to the applicability of Rule 6 of 1988 Rules, is affirmed, however, the direction with regard to the adjustment on account of volume of imports of CAB by the appellant @ 20% in the price difference between each variety of CAB imported by the appellant and the corresponding CAB of the competitor, is set aside.

37. In the circumstances, there will be no order as to costs.

JULY 26, 2010.

In the judgment pronounced on 26th July, 2010, in paragraph No. 24, the words, "judiciary scrutiny shall be read as "judicial scrutiny."