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Issues: Valuation of imported car based on purchase price vs. manufacturer's list price, applicability of transaction value method, treatment of used motor vehicles in customs valuation law.
In this case, the appellant purchased a Mercedez Benz Car from Dubai and imported it to India in 1996. The customs assessed the car's value based on the manufacturer's list price, which included optional items. The appellant argued for a lower assessment based on the purchase price, citing the car's discontinuation in 1993 and providing evidence of the lower price paid. The Commissioner (Appeals) rejected the plea for a lower assessment, stating that the list price was the net price and no evidence of trade discount was provided. The appellant contended that the purchase price should be accepted as the transaction value, supported by the Supreme Court's decision in Eicher Tractors Ltd. v. C.C., Mumbai. The Tribunal noted that the transaction value method requires the goods to be sold for export to India, which was not the case as the car was purchased in Dubai and later imported to India. The Tribunal also considered the WTO Agreement on Customs Valuation, which allows for valuation based on catalogue prices of new vehicles for used cars. The Tribunal acknowledged the difficulties in valuing used cars and accepted the appellant's argument that the purchase price should be the basis for valuation due to the car being a discontinued model. Therefore, the Tribunal set aside the lower authorities' decision and remanded the case for re-determination of the customs value based on the purchase price, allowing for depreciation and additional alterations. The appeal was allowed in favor of the appellant.
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