9911796707
TMI Blog2008 (7) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 1998, BKPL had imported a naphtha based power plant of 165 MW capacity from M/s. General Electric, Houston (GE). It comprised three Gas Turbine Generators. One the GTGs, namely, GTI (191-104) was sent to the manufacturer of the power plant GE for repair. When GE opened the GTI (191-104) for repairs as per guarantee, a major component hot section path (HPP) was found damaged. They replaced the HPP and returned the GTG. BKPL cleared the repaired GTG under Bill of Entry No. 3973 dated 1-7-2004 in terms of Notification No. 94/96-Cus dated 16-12-96 which provided for exemption in respect of goods exported abroad and imported after repairs in excess of duty payable on the fair cost of repair including cost of materials replaced and, onward and return freight and insurance. The invoice value for the GTG considering the repair charges raised by GE was US $ 2719073.04. In the commercial invoice filed with the Customs, the repair charges showed was US $ 2591,914.89. It was ascertained that GE had three modes of sale of HPP; one, brand new HPP, another, outright sale of refurbished HPP and the third, refurbished HPP under the Rotable Exchange Programme (REP). REP was the cheapest of the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l respects including physical character, quality and reputation on the basis that both were refurbished with the same condition and performance guarantee. The appellants were at a loss to understand the wisdom of the Commissioner and the reasoning behind the above conclusion. It was woeful that the Commissioner had tried to justify his above 'scientific conclusion'. It was pathetic to know that the Ld. Commissioner had suffered from selective amnesia. The Commissioner had made a ridiculous proposition in observing that, as both the HPP imported by the appellants as a spare and as a replacement built in the GTG during repair, would work for a minimum of 12500 firing hours and as both of them carried one year warranty from GE, they were to be considered identical. They argued that in the light of Rule 5(3) of CVR, the price for import of HPP under REP by GMR in March, 2004 had to be accepted. BKPL had purchased HPP in March, 2004 on outright basis. Citing an email of one Shri Narayan Das of GE dated 30-5-2005, BKPL argued that the HPP purchased by GMR was not valued at incremental value of the refurbished part. The assessment of HPP was not questioned by the Revenue and therefore, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Union Amount of drawback of customs or excise duties allowed at the time of export (b) under claim for drawback of any excise duty levied by a State Amount of excise duty leviable by State at the time and place of importation of the goods (c) under claim for rebate of Central excise duty Amount of rebate of Central excise duty availed at the time of export (d) under bond without payment of Central excise duty Amount of Central excise duty not paid (e) under duty exemption scheme (DEEC) or Export Promotion Capital Goods Scheme (EPCG) Amount of excise duty leviable at the time and place of importation of goods and subject to the following conditions applicable for such goods - (I) DEEC book has not been finally closed and export in question is delogged from DEEC book. (II) In case of EPCG scheme the period of full export performance has not expired and necessary endorsements regarding re-import have been made. (III) The importer had intimated the details of the consignment re-imported to the Assistant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin 12500 firing hours in terms of the warranty provisions covering the imported GTG and the power plant. Both the HPPs had the same reputation and were of the same quality. They were identical goods for the purpose of Rule 5 of CVR. The Commissioner rejected the value of HPP accepted by the department in respect of import of identical equipment contemporaneously by GMR Energy Ltd., Bangalore for their Mangalore plant. This was because that import was under an agreement between GMR and GE for maintenance and service of GTG. The terms of the impugned import were different from that of import by GMR. The notification prescribed a self contained procedure for determination of the amount on which duty due on re-import of repaired goods was to be paid. This amount was the aggregate of fair cost of repair, cost of materials used for replacing worn out parts, the cost of freight and insurance for transportation of the equipment for repair by the manufacturer and return to the importer. The assessment required is that of GTG1 (191-194) which had been exported abroad and re-imported after repairs. Assessment was not of HPP under the Customs Act. Taking recourse to Section 14 and provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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