2008 (8) TMI 891 - AT - Customs

Valuation - new machine - rejection of transaction value - rebuttal evidence in the form of another Chartered Engineer s Certificate - Held that - the transaction value of second-hand machineries cannot be rejected in the absence of any contemporary import of identical goods at identical prices - the Transaction Value is accepted while restricting the RF and penalty to 10% and 5% respectively - appeal allowed - decided partly in favor of appellant.

Summary

Issues:
Import of second-hand machinery, rejection of Transaction Value by Revenue, adoption of value estimated by Chartered Engineer, challenge by appellants with rebuttal evidence, contention regarding Transaction Value acceptance based on legal precedents, opposition by department, consideration of Apex Court judgments, imposition of penalty and redemption fine.

Analysis:

Import of Second-Hand Machinery:
The case involved the import of second-hand machinery by four different appellants as detailed in the provided table. The Revenue rejected the Transaction Value and instead adopted the value estimated by a Chartered Engineer.

Challenge to Revenue's Decision:
The appellants challenged the Revenue's decision by providing rebuttal evidence in the form of another Chartered Engineer's Certificate. They contended that the new machine's value could not be estimated by the Chartered Engineer as it was not available in the market. The appellants emphasized that no underhand billing had been done, and they had not received any additional money beyond the Transaction Value.

Legal Precedents and Contention:
The appellants argued that legal precedents, including judgments by the Apex Court and the Tribunal, supported the acceptance of Transaction Value. They referenced cases like Tolin Rubbers Pvt. Ltd. v. CC, Cochin and MICO Ltd., where the courts upheld the assessee's right to adopt Transaction Value in the absence of contemporary imports at identical prices.

Department's Opposition:
The department, represented by the SDR, opposed the appellants' prayer and supported the adoption of value as per the Chartered Engineer's Certificate obtained by the department.

Judgment and Decision:
The Tribunal carefully considered the submissions and noted that the issue had already been extensively addressed by the Apex Court in previous cases like Tolin Rubbers and MICO Ltd. The Tribunal agreed with the appellants, citing legal precedents, and held that the Transaction Value should be accepted. The value was further supported by certificates. Additionally, the Tribunal addressed the issue of imposing penalties and redemption fines, restricting them to 10% and 5%, respectively, in line with previous rulings.

Conclusion:
The Tribunal accepted the Transaction Value for the imported second-hand machinery, as supported by legal precedents, and restricted the penalties and redemption fines. The appeals were disposed of accordingly, emphasizing the importance of Transaction Value in such cases.