2015 (12) TMI 583 - AT - Customs

Determination of assessable value - import of old and used photocopier mainframes is restricted and the importer required an import licence for the same - Held that - Revenue has not first rejected the transaction value by production of any evidence. Further, it is not Revenue s case that any extra money has been delivered to the foreign supplier, without reflecting the same in the records. Revenue has simplicitor adopted the value of another import of old and used photocopier machines. It may not be out of place to observe here that the value of the second hand goods depends upon the number of factors including the conditions of the goods and as such, the second hand goods cannot be held to be contemporaneous to each other. In view of the foregoing, we find no merits in the impugned order of the lower authorities. The same are accordingly set aside - Decided in favour of assessee.

Summary

Issues:
Import of old and used mainframes without an import license
Discrepancy in the declared value of imported goods
Application of Customs Valuation Rules

Import of Old and Used Mainframes without an Import License:
The case involved the import of 119 pieces of Old and Used Mainframes for Copier Incorporation Optical Systems without the required import license. The Revenue objected to the import, claiming restrictions and the need for a license. However, the Tribunal referred to a Supreme Court decision stating that before 19-10-2005, the import of second-hand photocopier machines did not require a license. As the bill of entry was filed on 14-9-2005, the Tribunal held that the items were not restricted, following the Supreme Court's ruling.

Discrepancy in the Declared Value of Imported Goods:
Regarding the valuation issue, the appellant did not provide an Overseas Chartered Engineer Certificate. Consequently, the Revenue engaged a local Chartered Accountant to assess the value based on the old conditions of the photocopiers. The Revenue enhanced the value to Rs. 15,45,968. However, the Tribunal noted that the Revenue did not follow the proper procedure as per Customs Valuation Rules. Citing a Supreme Court case, the Tribunal emphasized the importance of rejecting the transaction value only in exceptional circumstances. Since the Revenue did not provide evidence or show any excess payment to the supplier, the Tribunal found no merit in the Revenue's valuation and set aside the lower authorities' decision.

Application of Customs Valuation Rules:
The Tribunal referred to a decision where it was observed that adopting the value from a Chartered Accountant's certificate without evidence of excess payment by the importer to the supplier was not in line with Customs Valuation Rules. In this case, the Revenue had not rejected the transaction value or provided evidence of extra payment. The Tribunal highlighted that the value of second-hand goods depends on various factors and cannot be considered contemporaneous to each other. Consequently, the Tribunal set aside the impugned order of the lower authorities, allowed the assessee's appeal, and rejected the Revenue's appeal.

In conclusion, the Tribunal held that the import of old and used mainframes did not require an import license before a specific date, pointed out discrepancies in the valuation process, and emphasized the importance of following Customs Valuation Rules for determining the correct value of imported goods.