2007 (3) TMI 19 - AT - Customs

Drawback Appellant imported two cranes under the contract and gets drawback on it Department contended that the value declared in respect of one model genuine Authority rejected the department condition.

Summary

Issues:
Challenge to Order-in-Appeal confirming duty demand on imported cranes; Valuation of imported cranes for duty assessment; Consideration of duty drawback entitlement in enhanced valuation; Applicability of Section 74(2) of the Customs Act, 1962 on duty drawback; Determination of assessable value for imported cranes; Direction for allowance of duty drawback on enhanced assessable value.

Analysis:
The appellants contested the Order-in-Appeal upholding duty demand on two imported cranes, Model No. 3900W and Model No. 999C. The declared CIF values were disputed, leading to reassessment under Section 18 of the Customs Act, 1962. An expert's report highlighted discrepancies in declared values compared to similar imports, resulting in confirmation of duty demands for both cranes.

Regarding duty drawback entitlement, the appellants argued that the enhanced valuation did not consider their entitlement to drawback under Section 74(2) of the Customs Act. The authorities failed to address this claim, leading to a partial allowance of the appeals with a direction to consider drawback entitlement based on the enhanced duty liability.

The provisional assessments were paid for both cranes, and duty drawbacks were allowed upon re-export. The entitlement to drawback under the relevant Notification was emphasized, indicating that the right to drawback on enhanced duty liability post-finalization of provisional assessment should not be disregarded as per Section 74(2) of the Act.

The assessable value determination faced scrutiny due to the appellants acting as both exporters and importers. The authorities relied on comparable machinery imports and exercised best judgment criteria to ascertain enhanced values. The duty demands on the enhanced assessable values were confirmed, with a directive to allow duty drawbacks based on the revised values.

In conclusion, the appeals were partly allowed, emphasizing the allowance of duty drawbacks at specified rates for each crane in line with the enhanced duty liability. The Original Authority was instructed to expedite the process and make necessary adjustments, considering the pre-deposit made by the appellants.