1998 (12) TMI 159 - AT - Customs

Summary

Issues:
1. Import of used Photocopiers' main frame with Hardware and P.C.B.
2. Valuation of the imported goods.
3. Classification of the imported goods as components or sub-assemblies.
4. Interpretation of the Special Import Licence (SIL).

Issue 1: Import of used Photocopiers' main frame with Hardware and P.C.B.:
M/s. Bhagwan Electronic Photocopiers appealed against an Order-in-Appeal passed by the Commissioner of Customs (Appeals) regarding the import of used Photocopiers' main frame with Hardware and P.C.B. The appellants declared the assessable value as Rs. 1,06,625.47 and sought clearance under Special Import Licence (SIL).

Issue 2: Valuation of the imported goods:
The Additional Collector of Customs ordered confiscation of the goods with an option for redemption on payment of a fine of Rs. 1,00,000/- and imposed a penalty of Rs. 30,000. The valuation was based on the assertion that the imported goods were sub-assemblies, not components of a photocopier, and constituted 60% of a complete photocopier. The Commissioner Customs (Appeals) upheld this valuation method.

Issue 3: Classification of the imported goods as components or sub-assemblies:
The appellants argued that the imported goods were components, not sub-assemblies, and should be considered as individual items necessary for the assembly of a photocopier. They contended that the valuation method used by the authorities, based on the value of the complete photocopier and depreciation, was incorrect. The Tribunal agreed with the appellants, emphasizing that the goods imported were indeed components required for the assembly of a photocopier.

Issue 4: Interpretation of the Special Import Licence (SIL):
The dispute also involved whether the imported goods fell under the scope of the Special Import Licence. The Department considered the goods as sub-assemblies, not covered by the SIL. However, the Tribunal concluded that the imported goods, being essential for the assembly of a photocopier, should be classified as components and were thus covered by the SIL.

In conclusion, the Tribunal set aside the impugned order and allowed the appeal, emphasizing that the imported goods were components necessary for the assembly of a photocopier, contrary to the classification as sub-assemblies. The valuation method based on the entire photocopier's value and depreciation was deemed inappropriate, and the goods were found to be covered by the Special Import Licence.