The Kolkata bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the maximum depreciation that was allowable on second-hand machines that are imported is 70% in the appeal by India Potteries Ltd (the Appellant) against the order for enhancement of the declared value, by the Commissioner of Customs (Port) (the Respondent)
India Potteries Ltd had imported a second-hand machine from Germany and had enclosed the commercial invoice raised by the foreign supplier showing the value of the second-hand machinery as Euro 15506. After examination of the commercial invoice and the Certificate issued by the Chartered Engineer, engaged by the exporter, the Commissioner of Customs ordered for enhancement of the declared value of the second-hand machinery which was enhanced to Euro 28,280 including the differential duty which was confirmed.
Despite the Hearing Notice, no one appeared on behalf of the appellant. However, in the interest of justice, the Appeal was taken up for disposal on merits with the help of the Authorized Representative (AR).
Upon inspecting the copy of the Chartered Engineer’s Certificate, it was found that the gross value of the machinery if purchased as new would be Euro 84,500, and if old machinery was purchased, the value of overhauling would be Euro 7,000/-.
The counsel who appeared on behalf of the revenue submitted that the Board had specified that when the accuracy of value is doubt, the value should be adopted as per Rule 12 of the Customs Valuation (Determination of value of imported goods), Rules, 2007 and the Directorate General of Valuation had clarified that in case of the second-hand machinery, the maximum depreciation allowed would be 70%.
The AR also produced a copy of circulars dated 12/02/2008 and 19/11/1987 and submitted that the lower authority had correctly enhanced the value to EURO 28,280/-, following the instructions of the Circulars.
It was further submitted that the Chartered Engineer himself had certified all the relevant values including the overhauling charges. Therefore, there was no error in the Orders passed by the Lower Authority.
The two-member bench consisting of R.Murlidhar (Judicial Member) and Rajeev Tandoon (Technical Member) after hearing both sides held that “The Appellant in his submissions has not brought in any evidence to rebut the valuation certified by the Chartered Engineer.” And dismissed the appeal.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
