2015 (7) TMI 148 - AT - Customs

Valuation of goods - Old and used second hand imported monitors and computer parts - Held that - Commissioner (Appeals) has already reduced the redemption fine from ₹ 3.30 Lakhs to ₹ 2.50 Lakhs and penalty from ₹ 1.30 Lakhs to ₹ 75,000/-. Ld. Advocate has brought to our notice the other decision of the Tribunal where the redemption fine was reduced to 10% and penalty to 5%. Our attention stands drawn to a latest decision of the Hon ble Punjab & Haryana High Court s decision in the case of B.E. Office Automation Products vide final order dated 18.11.2013, wherein the Hon ble High Court has held that keeping in view the element of wiping out of profit in the interface of expenditure incurred on detention and demurrage charges as also in defraying of legal expenses and interest, redemption fine of 10% of the value assessed by the department and penalty of 5% of such value would suffice. By adopting the same criteria, we reduce the redemption fine to 10% and penalty to 5% of the value of the imported goods. - Decided partly in favour of assessee.

Summary

Issues: Valuation of old and used imported monitors and computer parts, enhancement of assessable value, reduction of redemption fine and penalty.

Valuation of Old and Used Imported Monitors and Computer Parts:
The dispute in the appeal revolves around the valuation of old and used second-hand imported monitors and computer parts. The Revenue enhanced the declared assessable value based on the valuation proposed by a Chartered Engineer. The Appellants had accepted the enhanced value before clearance of the goods. The Appellate Authority expressed doubts about the transaction value for old and used items, stating that assessable value is typically enhanced in such cases. However, the Tribunal disagreed with this view, emphasizing that the Customs Valuation Rules, 2007 must be strictly followed. The Tribunal cited various High Court decisions and the Supreme Court's ruling in Tolin Rubbers Pvt. Ltd. Vs. CC, Cochin, highlighting the need for tangible evidence to reject the transaction value. The Tribunal concluded that valuation should be evidence-based and not driven by doubts, ultimately ruling against the enhancement of value.

Reduction of Redemption Fine and Penalty:
While the Appellant did not challenge the requirement of a license for importing second-hand goods, they sought a reduction in the redemption fine and penalty. The Commissioner (Appeals) had already reduced the redemption fine and penalty, but the Appellant argued for further reduction based on other Tribunal decisions. The Tribunal referred to a decision by the Hon'ble Punjab & Haryana High Court in the case of B.E. Office Automation Products, which established criteria for determining redemption fine and penalty. Following this precedent, the Tribunal reduced the redemption fine to 10% and penalty to 5% of the value of the imported goods. Thus, the appeal was disposed of with the adjusted redemption fine and penalty percentages in line with the established criteria.

In summary, the judgment addressed the issues of valuation of old and used imported monitors and computer parts, emphasizing the need for evidence-based valuation under the Customs Valuation Rules. The Tribunal rejected the enhancement of assessable value and reduced the redemption fine and penalty based on established criteria and relevant legal precedents, ultimately providing a comprehensive resolution to the appeal.