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2024 (9) TMI 254 - AT - CustomsOld and used second hand goods or unused new goods - valuation of goods - rejection of transaction value - value determined by the adjudicating authority on the basis of the Chartered Engineer s report - confiscation - levy of penalties. Whether evidence available on record indicate that the goods imported by the appellant are old and used second hand goods as claimed by the department or unused new goods which looks old because of keeping them in stock for a longer period as claimed by the appellant? - HELD THAT - On perusal of the report issued by the Chartered Engineer it is observed that the report is not in consonance with the physical availability of the goods in the consignment. In the examination report the Chartered Engineer reported that the date of manufacture is not available on the goods ignoring the fact that the 19 LCD Panels of Lenovo Brands of 2876 pcs was manufactured on 01.08.2021 which was embossed on it. It is also observed that the Chartered Engineer s report is not conclusive as he suggested for further laboratory test to ascertain its functionality residual life etc. Accordingly the adjudicating authority could not have come to the conclusion that the impugned goods are old and used only on the basis of this Chartered Engineer s report which is inconclusive on the nature of the imported goods in its findings. The evidence available on record does not indicate that the goods imported are old and used. On the contrary the letter submitted by the appellant indicate that the supplier has categorically stated that the imported goods are new supplied from the old stock. Unused goods supplied from old stock may look old and obsolete but for the purpose of import policy they cannot be called as second hand goods which require an authorization for importation. Accordingly on the basis of evidences available on record and the decisions cited above we hold that the goods imported by the appellant in this case cannot be considered as second hand goods which require authorization for import. Thus there is no violation of EXIM policy warranting confiscation of the goods imported under the bills of entry - the order of confiscation and imposition of redemption fine for violation of foreign policy by the appellant set aside. Valuation of the goods - HELD THAT - There is no evidence brought on record to establish that the transaction value between the parties was influenced by any other consideration. Value may be diminished on account of variety of reasons such as wear and tear non-use obsolescence or the like. Depreciation on account of wear and tear is a well-known concept. So also depreciation on account of obsolescence. Hence as the goods are supplied out of stock lot a slight variation in value as compared to the new item of similar goods is permissible. The adjudicating authority has not made any effort to find out the value of similar goods in the market. He has rejected the transaction value declared by the appellant only on the basis of the Chartered Engineer s report - the value determined by the adjudicating authority on the basis of the Chartered Engineer s report is arbitrary and not supported by any corroborative evidence - the value redetermined by the adjudicating authority is rejected. The differential customs duty confirmed in the impugned order on account of re-determination of the assessable value set aside. Since the duty re-determined is set aside the question of demanding interest does not arise. Imposition of penalty - HELD THAT - The penalty has been imposed on the appellant on account of redetermination of value and on the basis of allegation of mis-declaration. In the instant case the goods from old stock has been sent on account of the mistake of the overseas supplier which is beyond the control of the appellant. Since the allegation of mis-declaration and under valuation is not sustained the goods are not liable for confiscation. The question of imposition of Penalties u/s 112(a) 112(b) 114AA of Customs Act 62 does not arise - Regarding imposition of penalty under Section 114AA it is observed that no evidence has been brought on record that the appellant used any false and incorrect materials or made any declaration statement or document which is false or incorrect in transaction of his business. Hence imposing of penalty on the importer under section 114AA does not arise in this case. The impugned order is set aside - appeal allowed.
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