2006 (5) TMI 524 - AT - Customs

Summary

Issues:
1. Rejection of declared value in Bill of Entries for second-hand imported machines.
2. Misdeclaration of the age of the machine.
3. Application of the principle of granting deductions in valuation.
4. Contemporaneous import evidence requirement for accepting transaction value.
5. Applicability of judgments in similar cases to the present scenario.

Analysis:
1. The appeal challenges the rejection of declared value in the Bill of Entries for second-hand imported machines, leading to an enhanced value and an order of confiscation. The appellant argues that without evidence from the Revenue, the transaction value cannot be rejected under Section 14 of the Customs Act. The appellant relies on the Tolin Rubbers Pvt. Ltd. case, asserting that transaction value cannot be rejected for second-hand goods. The Tribunal's ruling in S&S International case is also cited to support the appeal.

2. The Department contends that there was misdeclaration of the machine's age, justifying the valuation by a Chartered Engineer with deductions. The Department relies on the Gajra Bevel Gears case to support the valuation method. However, the appellant argues that without evidence of undervaluation, such a judgment is not applicable. The appellant emphasizes the availability of clear evidence on transaction value, invoking the Tolin Rubbers case and the Tribunal's ruling in S&S International.

3. Upon careful consideration, the Tribunal agrees with the appellant that there is no charge of undervaluation in the present case. Citing the Tolin Rubbers case, the Tribunal holds that in the absence of undervaluation evidence, the transaction value cannot be rejected for second-hand machineries. The Tribunal refers to the judgment in S&S International, supporting the acceptance of declared transaction value.

4. Regarding the requirement of contemporaneous import evidence for accepting transaction value, the appellant argues that numerous Tribunal and Apex Court judgments support this stance. The Tribunal cites the Sounds-N-Images case and Sai Impex case to emphasize the burden of undervaluation on the Revenue and the necessity of contemporaneous import evidence. The Tribunal applies the Tolin Rubbers case and other judgments to uphold the transaction value for second-hand machinery.

5. The Tribunal finds that the judgments cited align with the facts of the case, echoing similar views expressed in the Iquira Ink case and the Eicher Tractors Ltd. case. Consequently, the impugned order is deemed not legal and proper, leading to its setting aside and allowing the appeal with any consequential relief.