Home Case Index All Cases Customs Customs + AT Customs - 2015 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (4) TMI 112 - CESTAT NEW DELHI (LB)Valuation of goods - Redemption fine - Penalty - whether the declared value of goods can be accepted in terms of the provisions of Section 14 of the Customs Act, 1962 - Difference of opinion - Majority order - Held that:- The declared transaction of the value of the goods is ₹ 10,13,256/- and the Department wants to reject the same and enhance it to ₹ 20,13,120/- based on the Chartered Engineer s report on the ground that as per the NIDB data the declared value is too low. In my view for determining the value of the old and used capital goods, which are of obsolete models, the NIDB data is not relevant at all as no two consignments of second hand goods and that too of obsolete models would be comparable. The value of a consignment of second hand machines would depend upon the years for which the machinery has been used, present condition and also whether the model is obsolete or whether such machines are still being manufactured. In this case as per the facts recorded in the impugned order-in-original, market inquiry indicated that the models of the photocopiers are obsolete models and the manufacturers have discontinued the manufacture of these models. If this is so, a supplier may sell such old and used goods of obsolete model even at throw away price. It is not the allegation of the Department that the appellant and the foreign supplier were related person or that there were circumstances as enumerated in the proviso to sub-Rule (2) of Rule 3 of the Customs Valuation Rules, 2007 on account of which the declared transaction value cannot be accepted. Another situation in which the declared transaction value can be rejected is that covered by Rule 12 of the Cenvat Valuation Rules when the proper officer has reason to doubt the correctness of the declared transaction value. But Rule 12 of the Cenvat Valuation Rules also provides that if after inquiry by the proper officer, the proper officer doubts the correctness of the declared transaction value and rejects the same, he is required to intimate the importer about rejection of the declared value after giving reasonable opportunity of being heard. But no such inquiry has been done in this matter. Merely on the basis of NIDB data which, as discussed above, is not relevant in this case, the declared transaction value could not be rejected. As regards of quantum of redemption fine and penalty, it is settled law in the cases of import of restricted goods without import licence, the quantum of redemption fine should be sufficiently high to neutralin the entire margin of profit. Member (Judicial) has reduced the fine to 10%. According to the Department it should be 50% of the declared value. However, if the Department seeks imposition of higher redemption fine, the evidence of higher profit margin should be produced in form of landed cost of the goods and the market price of the goods but no such evidence has been produced. In view of this, I agree with the decision of Member (Judicial) regarding reduction of redemption fine and penalty and in my view the redemption fine of 10% of the value and penalty of 5% of the value is sufficient. - Decided partly in favour of assessee.
|