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2015 (6) TMI 775 - SC - CustomsValuation of imported machines - Depreciation method in terms of Circular No. 493/124/86-CUS dated 19.11.87 - No sale involved only transfer of goods - Held that:- We find that section 14 of the Customs Act, 1962 deals with valuation of goods for the purposes of assessment.The reading of the aforesaid provision manifests that the valuation of the imported goods is to be arrived at by ascertaining the price at which such or like goods are ordinarily sold or offered for sale for delivery at the time and place of importation or exportation. Therefore, the method to be employed, as per the aforesaid provision, is to ascertain as to how much would be the price of such goods if they are to be ordinarily sold or offered for sale. In exercise of powers contained under Section 156 of the Customs Act, Customs Valuation (Determination of Price of Imported Goods) Rules 1988 have also been framed. In those cases, where it is not possible to determine the price at which such goods are ordinarily sold or offered for sale, Rule 8 provides for residual method and stipulates that the value shall be determined using reasonable means consistent with the principles and general provisions of the said Rules as well as provisions of sub-section (1) of Section 14 of the Customs Act. In the present case, we find that no efforts were made either by the Department or even by the appellant to ascertain the price at which the imported machineries could generally be sold or offered for sale. Had that been done, same would have been in consonance with the provisions of section 14(1) of the Customs Act. It appears that both the parties proceeded on the basis that such price is not ascertainable and therefore resorted to the method of depreciation. Even the appellant did so, though the basis of this exercise as adopted by the appellant was erroneous. For six years period i.e., when the machinery was used in Iraq and thereafter, it was brought to Nepal, its value as on that date was ascertained. Thus, for that period, it took into consideration the value which was fixed by the Chartered Engineer. Thereafter, for remaining three years, when it was in Nepal and brought to India, depreciation method is adopted.In such circumstances, we do not find any error in applying the circular dated 19.11.87 in the instant case. - Decided against the assessee.
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