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Issues Involved:
1. Whether the reports of the survey conducted after clearance can be accepted. 2. Whether rebate to the extent claimed should be granted under Section 22 of the Customs Act, 1962. Issue-Wise Detailed Analysis: 1. Acceptance of Survey Reports Conducted After Clearance The respondent imported a Charmilles D440 ISOCUT Electrical Discharge Machine, which was damaged during transit. The Customs Officers, including a machinery expert, examined the packages and noted the damages but did not appraise the value of the machine. The goods were cleared on payment of full duty without abatement. Subsequently, the respondent's insurer arranged a survey at the factory, which fixed the value of the damaged goods at Rs. 4,00,000/-. The respondent filed a claim for a refund of proportionate duty under Section 22 of the Customs Act, 1962, which was rejected by the Assistant Collector on the ground that the respondent had not taken steps to fix the value of the damaged goods at the time of examination by the proper officer under Section 22(3). The Collector (Appeals) allowed the appeal, directing reassessment based on the surveyors' value and granting consequential relief to the respondent. The appellant contended that there was no indication of internal damage in the customs examination report or the importer's application, and the transport after clearance was not under customs supervision. Customs Officers were not informed about the survey conducted in the factory, and the survey report was deemed untenable. The Tribunal referred to previous cases, including Kasturi & Sons Ltd v. Collector of Customs, Madras, and Collector of Customs, Ahmedabad v. Sharma Metal Rolling Mills, to emphasize that once the importer informs the Customs of the damage, it is the duty of the Department to assess the value as per Section 22(3). The failure of the Assistant Collector to perform his statutory duty meant that the survey report conducted in the absence of Customs Officers could not be disregarded. 2. Granting Rebate Under Section 22 of the Customs Act, 1962 Section 22 of the Customs Act deals with abatement of duty on damaged goods. Clause (a) of sub-section (1) applies as the damage occurred before or during unloading. Sub-section (1) requires the Customs Officer to be satisfied about the damage, and sub-section (2) mandates that duty be charged proportionately. Sub-section (3) provides that the value of damaged goods may be ascertained either by the proper officer or by the sale of the goods, with the gross sale proceeds deemed as the value of the damaged goods. The Tribunal noted that the respondent exercised the option under Section 22(3) by requesting the Assistant Collector to conduct an examination and survey. The Assistant Collector noted some damages but did not assess the value. The respondent, after waiting for a few days, cleared the goods and arranged a survey at their factory. The survey conducted by the insurer's surveyors, though without informing the Customs Officers, was considered reliable as there was no suggestion of collusion or manipulation. The detailed examination conducted after clearance confirmed serious damage to the machine, which could not be repaired locally and required sending the unit back to the manufacturer. The final report indicated that the machine was a constructive total loss, valued at Rs. 4,00,000/- against the landed cost of Rs. 27,27,889/-. The Department did not challenge the surveyors' reports or the engineer's opinion. The Tribunal concluded that the surveyor's report dated 24-4-1985 was true and reasonable, and there was no ground to interfere with the Collector (Appeals)'s order. Thus, the appeal was dismissed, and the rebate claimed by the respondent was granted.
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