1996 (11) TMI 224 - AT - Customs

Summary

Issues: Violation of import regulations, Mis-declaration of value, Dispute over assessable value, Application of discount on imported goods.

Analysis:

1. The appeal challenged an order by the Collector of Customs confiscating imported goods due to unauthorised import and mis-declaration of value. The appellant had entered into a Technical Collaboration Agreement for manufacturing cars in India and imported components under various licenses.

2. The appellant imported spares not approved by the Directorate General of Technical Development (D.G.T.D) under a license for warranty coverage and after-sales service. The dispute arose over the valuation of these spares, with the appellant arguing for a 35% discount on the Master Price List price.

3. The Tribunal found that the imported spares did not align with the approved components list, indicating a violation of import regulations. The license explicitly allowed import of spares used in manufacturing, which the appellant failed to demonstrate.

4. Regarding valuation, the appellant contended for a 35% discount based on manufacturer letters, indicating a standard discount offered to Collaborators. The Tribunal agreed that the discount should be applied, as it was not a special discount but a common practice in international trade.

5. The Tribunal acknowledged the appellant's fault in the ITC angle but directed the Commissioner to re-assess the assessable value based on the Master Price List price with a 35% discount. The goods were liable for confiscation but could be redeemed upon payment of a Redemption Fine and imposition of a penalty.

6. The impugned order was set aside, and the jurisdictional Commissioner was directed to re-assess the assessable value, confiscate the goods, determine the Redemption Fine and penalty amount. The decision favored the appellant's argument for the application of the standard discount on the imported goods.

7. Ultimately, the appeal was allowed, highlighting the importance of adhering to import regulations, accurate valuation of goods, and the application of standard trade practices in determining assessable value.