V. Padmanabhan ORDER
1. The present appeal is against the OIO No. 5409/2006 dt. 24.8.2006.
2. Appellant imported one set of used offset printing machine along with standard accessories from M/s. Benelux International Trading BVBA, Belgium and declared the transaction value of GBP 7500 (CIF) (equivalent to Rs. 5,67,375) and filed necessary Bill of Entry No. 481117 dt. 16.04.2003. Along with the Bill of Entry, importer enclosed an overseas Chartered Engineer certificate dt. 20.01.2003 issued by Graphic Consult N.V./S.A., Belgium. The Docks Intelligence Unit, Custom House, Chennai took up the consignment for investigation on receipt of intelligence regarding alleged under valuation. Suspecting the value, goods were got examined by a local Chartered Engineer, M/s. Superintendence Co. of India Pvt. Ltd. who vide report dt. 24.04.2003 assessed the value of the goods at GBP 11,900.00 (CIF) (equivalent to Rs. 21,40,895/-). The goods were also got examined by another Chartered Engineer M/s. SGS India Private Ltd. who assessed the value at GBP 29000.00 (CIF). Since the goods were more than 10 years old, a show cause notice was issued proposing re-assessment of the value of the imported goods as well as confiscation thereof for violation of ITC regulations. After due process of adjudication, learned Commissioner ordered for enhancement of value of the imported goods in terms of local Chartered Engineer opinion and demanded differential duty of Rs. 8,07,341/-. The goods were confiscated and allowed to be redeemed on payment of fine of Rs. 2 lakhs and penalty of Rs. 1 lakh. Aggrieved by the impugned order, present appeal has been filed.
3. With the above back ground, we heard Shri A.K. Jayaraj, Ld. Advocate on behalf of the appellant as well as Shri B. Balamurugan, Ld. D.R.
4. The learned Advocate argued that customs department had no valid reason for disregarding the overseas Chartered Engineer certificate produced at the time of import. The genuineness of the certificate has not been doubted or disapproved. The valuation of goods by the local Chartered Engineer has been done arbitrarily without even inspecting the imported goods. He further submitted that the load port Chartered Engineer gives the year of make of the machines, the value of goods at the time of manufacture as well as value at the time of export. The import invoice as well as Chartered Engineer certificate bears the stamp of State Bank of Patiala evidencing that only the invoice amount has been paid to the overseas supplier. Consequently, he argued that declared value merits acceptance. He also relied upon the Tribunal in the case of Anish Kumar Spinning Mills Vs. CC Tuticorin MANU/CC/0141/2004 : 2004 (172) ELT 394 (Tri.-Chennai) wherein the Tribunal has held that opinion of one expert cannot be rejected on the basis of another expert unless there is sufficient independent reason for such rejection. The said decision has also been approved by the Hon'ble Supreme Court as reported in 2005 (182) ELT A92 (SC).
5. The Ld. D.R. supported the impugned order. He argued that learned Commissioner in the impugned order has explained the sufficient reasons for rejecting the load port Chartered Engineer. It has been held that Chartered Engineer who has given the certificate is not on the list of authorized Chartered Engineers notified by D.G.F.T. The certificate also suffers from several deficiencies. Hence it has been rightly disregarded by the adjudicating authority. He further argued that the valuation of imported goods is required to be determined by customs authorities on the basis of various factors and not only on the basis of amount paid to the exporter.
6. Heard both sides and perused the records. The Bill of Entry has been filed for clearance of the imported used goods along with a Chartered Engineer certificate from the load port, dt. 20.01.2003. The same has been disregarded by the customs authorities and the value has been got certified by a local Chartered Engineer who has assessed the value of the goods to be much higher than the declared value. The grievance of the appellant is that custom authorities have disregarded the load port Chartered Engineer certificate without valid reasons to reject the same. There is nothing on record to doubt or disapprove the load port Chartered Engineer. The main reason for disregarding such certificate as indicated by the adjudicating authority is that the year of manufacture has been certified. However, neither accompanying invoices nor any other documents submitted by the importer evidences such year of manufacture of machines.
7. After perusal of the certificate given by the local Chartered Engineer as well as from the load port, we note that local Chartered Engineer was not in possession of any additional information to decide the valuation. Virtually, he has not given any reference to the technical manual or information based on which value of the machines have been reassessed. In fact, the local Chartered Engineer has indicated the year of manufacture as 1984 as against 1975 by the Chartered Engineer at load port. In the light of the above, we are of the view that customs authorities have rejected the opinion of one expert simply on the basis of opinion by another expert. We note that there is no other sufficient independent reason for such rejection. Such rejection has been held as not a valid basis for rejection of Chartered Engineer certificate in the case of Anish Kumar Spinning Mills (supra). The said decision has also been approved by the Hon'ble Supreme Court reported in 2005 (182) ELT A92 (SC), hence is binding on this Bench. By following the said decision, it is to be held that reassessment value on the basis of local Chartered Engineer certificate is not valid. Consequently, the declared value backed by the Chartered Engineer certificate from the originator is to be accepted.
8. Admittedly, the imported goods are more than 10 years old in terms of Import Trade Control Regulations in EXIM 2002-07 read with para 3.3 of the Handbook of Procedures of Vol-I. The importers have violated the provisions of Foreign Trade (Development and Regulation) Act, 1992. The goods are therefore liable for confiscation under Section 111 (d) of the Customs Act, 1962.
9. Consequently, the importers are liable for imposition of penalty also under Section 112(a) ibid.
10. Keeping in view the facts and circumstances of this case, we reduce the redemption fine to Rs. 60,000/- (Rupees sixty thousand only) and the penalty imposed to Rs. 30,000/- (Rupees thirty thousand only).
Appeal is partially allowed in the above terms.
(Operative part of the order pronounced in open court on 19.06.2017).
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