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Valuation of second hand machinery

Customs - 25/2015 - Dated:- 15-10-2015 - Circular No. 25/2015 F. No. 467/34/2006-Cus.V Government of India Ministry of Finance Department of Revenue Central Board of Excise & Customs 15th October 2015 All Principal Chief Commissioners All Chief Commissioners of Customs, All Chief Commissioners of Customs & Central Excise, All Directorate-Generals, Chief Departmental Representative, All Principal Commissioners of Customs, All Principal Commissioners of Customs & Central Excise All Com .....

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at the port of loading should be accepted. The circular also states that there is no need to specify the agencies whose certificates alone would be accepted. It has been ascertained from field formations that the present practice in this regard is that if an importer produces a chartered engineer's appraisement report issued at the load port, with the ingredients indicated in para 8 (a) of the circular 4/2008-Cus, the same is being accepted by Custom Houses. Also, appraisement /inspection re .....

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e Associations (CII, FICCI, ASSOCHAM, BCHAA and others) 2. After due consideration of the suggestions and concerns put forth the Board has decided to issue the following guidelines for valuation of imports of second hand machinery: 3. Where used second hand machinery is sold for export to India and the sale meets all of the requirements set out in Customs Valuation (Determination of Value of Imported Goods) Rules 2007, the price paid or payable for the goods is to be used as the basis for determ .....

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sale of the goods. Costs of all such elements need to be determined for the purpose of arriving at the value under section 14 of the Customs Act. Thus, there may be instances where the requirements of Rule 3 of the Valuation Rules are not met, in which case, the value for imposition of duty must be determined under one of the subsequent methods of valuation applied in sequential order. 5. In view of the nature of goods, there may be certain difficulties in applying Rule 4 or 5 of the CVR, 2007. .....

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eing appraised are imported for use rather than for resale. The difficulty of finding such sales of goods which could be considered identical or similar to the goods being appraised, may preclude the application of this method. 7. Under Rule 8 of the CVR, 2007, goods are valued using the computed value method which is based, among other things on the cost of production of the goods being appraised plus an amount for profit and general expenses. However, since used capital goods are not manufactu .....

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re-shipment inspection agency charges etc 9. Given the nature of challenges in computing the value of second hand machinery under Rule 9. and the need to ensure that the approach applied reflects commercial reality and results in a value which is fair, and is arrived through uniform processes by all custom houses, it is felt that it is necessary to obtain inspection / appraisement reports from qualified neutral parties. 10. For this purpose, the Board has decided that Inspection /Appraisement Re .....

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gencies notified as per HBoP 2015-20. In case the agencies notified in the HBoP not being at the port of import, the importers will be free to select any Chartered Engineer from those empaneled by the Custom House of the port of import. 11. No Custom House shall require any importer to have an inspection / appraisement report of second hand machinery from a particular Chartered Engineer. The importer shall be free to select any chartered engineer, empaneled by the Custom House for the respective .....

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re an overseas report of inspection / appraisement of the goods, he may have the goods inspected by any one of the agencies in India, as are notified by the DGFT under Appendix 2G of the HBoP 2015-20 and Aayat Niryat Forms to FTP 2015-20, as amended from time to time (para 2.59 of Handbook of Procedures 2015-20 refers). d). At customs stations where agencies notified by DGFT are not present, importers may continue to avail of the services of locally empaneled chartered engineers. e). In cases wh .....

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