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Issues:
Valuation of imported goods based on contemporaneous import price and eligibility for exemption under Notification No. 45/94-Cus. for goods used in the Leather Industry. Valuation Issue Analysis: The appellants imported Texon insole sheets for the Footwear Industry, valued at 8400 Italian Lira per sheet, but Customs authorities assessed them at 20,000 ITL per sheet based on a proforma invoice from the same supplier offering the goods at the higher price. The appellants argued that the proforma invoice cannot be the basis for assessment as it is only an offer price and does not represent an actual transaction. They highlighted discrepancies in the description of goods between the proforma invoice and the imported consignment. The Tribunal agreed with the appellants, stating that a proforma invoice does not indicate an actual transaction and cannot be used to reject the transaction value. The lower authorities erred in considering the proforma invoice as representing contemporaneous import price, leading to an incorrect valuation. Exemption Eligibility Issue Analysis: The appellants were denied exemption under Notification No. 45/94-Cus. on the grounds that they were traders and the imported goods could be used in non-leather shoes. The appellants argued that there is no prohibition in the notification for imports by traders, as long as the goods match the description in the notification. They also referenced a previous Tribunal decision stating that the words "for use" in the Leather Industry do not require the import to be by an actual user. The Tribunal found that the denial of exemption was unjustified, as the notification does not mandate proof of actual use of imported materials in the Leather Industry. The proviso to the notification only requires an undertaking from the importer regarding the specified use, which was not applicable to the insoles in question. The lower authorities' assumption that the goods could be used in other footwear materials was unfounded, as no evidence supported this claim. Therefore, the finding regarding the denial of exemption was deemed unwarranted and the impugned order was set aside, allowing the appeal with consequential relief to the appellants.
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