TMI Blog2016 (9) TMI 361X X X X Extracts X X X X X X X X Extracts X X X X ..... ioned in CBEC Circular No. 25/2015-Cus that value declared by the importer has to be examined with report of Chartered Engineer as also with the depreciated value arrived in terms of said CBEC Circular dated 19.11.1987. In case, there are significant differences from such comparison, proper officer of Customs will seek explanation from the importer for justification of declared value. If proper officer is not satisfied with said justification of the importer, he may proceed to determine the value under Rule 9 ibid. - Ruling No. AAR/Cus-1/ 26 /2016 in Application No. AAR/44/Cus-1/5/2015 - - - Dated:- 5-8-2016 - V.S. Sirpurkar (Chairman), Shri S.S.Rana (Member) And Shri R.S.Shukla (Member) For the Applicant : Shri Tarun Gulati, Advocate Shri Kishor Kunal, Advocate Sh. Manish Rastogi, Advocate For the Department : Shri Dr. Sudesh Sheoran (AR) RULING M/s First Concept Production Services Private Limited (hereinafter also referred to as applicant) is a resident private limited company. The applicant is a wholly owned subsidiary of Production Resources Management ( PRM ), of which the ultimate parent company is Broadcast Solutions ( BS ). BS engaged, inter alia, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dcasting Equipment will be procured by the applicant on lease basis temporarily and for a period for which they are required for the execution of contracts entered into between the applicant and its customers in India; that said Broadcasting Equipment falling under Chapter Heading 85 and 90 of the Tariff; that in terms of the said Exemption Notification, machinery, equipment or tools falling under Chapter 84,85,90 or any other Chapter of the Tariff are eligible for the exemption subject to the limitation and conditions specified therein. 5. Applicant has raised following questions for ruling by this Authority: A. Whether the applicant is eligible to claim the exemption under Notification No. 27/2002-Cus dated 01.03.2002 as amended by Notification No. 27/2008-Cus dated 01.03.2008 under the category of temporary import of leased goods? B. Whether the value stated in the Chartered Engineer s Certificate to be provided by the applicant at the time of import of the said Broadcasting Equipment can be the basis of Customs Valuation? C. In the alternative, whether the book value of the said Broadcasting Equipment shown in the books of accounts of BS/foreign suppliers can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, it ought to be adopted for the purpose of levy of Customs Duty under the Act. Applicant further submits that even with respect to the independent third party vendors, the import invoice will be well supported by the Chartered Engineer s Certificate which will categorically certify the description of the second-hand machinery, price of the new machinery as in the year of its manufacture, current C.I.F. Value of the new machinery, period of usage etc. and therefore, the value declared on the basis of the said import invoice along with the certificate issued by the Chartered Engineer ought to be taken as the transaction value for the purpose of calculating the concessional rate of Customs Duty. Applicant states that in light of the foregoing, that the price to be declared by the applicant at the time of import of the said Broadcasting Equipment on the basis of invoice received from BS as well as third party vendors ought to be considered as the transaction value for the purpose of levy of concessional rate of Customs Duty. Book Value shown in the books of Accounts of the Overseas Vendors ought to be adopted for the purpose of Customs Valuation. 9. Applicant submits that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the applicant stands superseded by said Circular dated 15.10.2015. 12. It is admitted fact that the valuation of broadcasting equipment proposed to be imported temporarily on lease basis, has to be under Rule 9 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 under Residual Method . Rule 9 ibid inter-alia states that where the value of imported goods cannot be determined under the provisions of any of the proceeding rules, the value shall be determined using reasonable means consistent with the principles and general provisions of these rules and on the basis of data available in India. 13. It is observed that CBEC vide Circular No. 25/2015-Cus dated 15.10.2015 issued guidelines for valuation of second hand machinery, which are summed up in paragraph 12 and reproduced below; 12. To sum up, the following guidelines shall be followed: (a) All imports of second hands machinery/used capital goods shall be ordinarily accompanied by an inspection/appraisement report issued by an overseas chartered engineer or equivalent, prepared upon examination of the goods at the place of sale. (b) The report of the chartered engineer or equivalent sho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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