1. Determination of whether buyer and seller are related persons under Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988. (Para 1 )
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1999 Supreme(SC) 1418
SUPREME COURT OF INDIA
N.Santosh Hegde : R.C.Lahoti : S.P.Bharucha
Collector Of Customs, Kandla
Versus
East African Traders
Case No. : 2511 of 1992
Date of Decision : 12/2/99
Important Points
Authorities and the Tribunal are permitted to pierce the corporate veil to determine whether a buyer and seller are 'related persons' under Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988.
Subject
Tax Law - Customs Law
Act Referred
Customs Valuation Rules, 1988: R.2(2)
Headnote
(A) Customs Valuation Rules, 1988 - Rule 2 sub-rule (2) - Piercing of corporate veil - Determination of whether buyer and seller are related persons - It is permissible for the authorities and the Tribunal to pierce the veil in given facts and circumstances to ascertain whether the buyer and seller are indeed related persons within the meaning of the said sub-rule. (Para 1)
Facts of the case:
An appeal was filed challenging the observations of the Tribunal regarding the piercing of the corporate veil of a company to determine whether the buyer and the seller were related persons under the applicable customs valuation rules.
Findings of Court:
The court held that the authorities and the Tribunal are permitted to pierce the corporate veil to determine the relationship between the buyer and the seller.
Issues: Whether the authorities and the Tribunal can pierce the corporate veil to ascertain if the buyer and seller are related persons under Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988.
Ratio Decidendi: Following established legal principles, it is permissible for the authorities and the Tribunal to pierce the corporate veil in specific facts and circumstances to determine if the buyer and seller are related persons within the meaning of Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988.
Result: Civil appeal disposed of.
Facts of the case:
An appeal was filed challenging the observations of the Tribunal regarding the piercing of the corporate veil of a company to determine whether the buyer and the seller were related persons under the applicable customs valuation rules.
Findings of Court:
The court held that the authorities and the Tribunal are permitted to pierce the corporate veil to determine the relationship between the buyer and the seller.
Issues: Whether the authorities and the Tribunal can pierce the corporate veil to ascertain if the buyer and seller are related persons under Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988.
Ratio Decidendi: Following established legal principles, it is permissible for the authorities and the Tribunal to pierce the corporate veil in specific facts and circumstances to determine if the buyer and seller are related persons within the meaning of Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988.
Result: Civil appeal disposed of.
Legal Category Hierarchy
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customs law
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valuation
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related persons
- piercing the corporate veil (Para 1)
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related persons
-
valuation
Table of Contents
2. Whether the corporate veil may be pierced to determine if buyer and seller are related persons under the Customs Valuation Rules, 1988. (Para 1 )
3. Authorities and the Tribunal may pierce the corporate veil to ascertain if buyer and seller are related persons under the relevant valuation rules. (Para 1 )
4. Piercing the corporate veil is permissible to ascertain whether buyer and seller are related persons under Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988. (Para 1 )
5. Civil appeal disposed of. (Para 2 )
6. Can the corporate veil be pierced to determine if parties are related persons under the Customs Valuation Rules, 1988?
Yes, it is permissible for the authorities and the Tribunal to pierce the corporate veil in given facts and circumstances to ascertain whether the buyer and the seller are related persons within the meaning of Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988. (Para 1 )
(1) THE learned Attorney General, appearing for the appellant has restricted his argument to the observations of the Tribunal in the order under appeal relating to the piercing of the veil of the respondent Company to determine whether or not the buyer and the seller were related persons, this being governed by Rule 2 sub-rule (2) of the Customs Valuation Rules, 1988 . The law that would apply is that laid down in the judgment of this Court in Calcutta Chromotype Ltd. v. CCE. It is permissible for the authorities and the Tribunal to pierce the veil in given facts and circumstances to ascertain whether the buyer and the seller are indeed related persons within the meaning of the said sub-rule.
(2) THE civil appeal is, therefore, disposed of.
(3) NO order as to costs.
