ORDER
S.L. Peeran, Member (J)
1. Both these appeals pertain to same set of facts and Bill of Entry No. 2579 dated 14.7.2005 by which import of 1188 Nos. of used printers bearing brand name “Epson”, “Oki Page” were imported from Germany under the invoice No. 131029 dated 31.5.2005. The matter was initially adjudicated and the Commissioner (A) vide Order-in-Appeal No. 84/05 Cus dated 20.10.2005 had partly remanded the matter, which is subject matter of Appeal No. 417/05. After denovo, the matter came up again before the Commissioner (A) who decided the matter by Order-in-Appeal No. 3/2006 Cus. dated 20.1.2006 which is subject matter of Appeal No. C/29/06.
2. The issue pertains to enhancement of value of the imported second hand used printers. The said printers were freely importable and do not require Licence. It is only the question of valuation which is under challenge. The Chartered Engineers certificate was not accepted by the department and the Revenue enhanced the value based on the valuation available in internet, which is under challenge. The Commissioner’s Order-in-Appeal No. 84/05 Cus dated 20.10.2005 remanded the case for carrying out fresh market enquiries to determine the correct value of the items, this has been challenged in Appeal No. 417/05. On remand to original authorities, they adopted the value available in internet and email messages for the purpose of valuation and value has been enhanced against the declared value.
3. The appellants contend that on this very same issue the Tribunal and Apex Court has decided and has held that valuation based on internet and email messages cannot be accepted and such valuation has been struck down.
(i) He relied on the judgment rendered by this Bench in the case of Office Devices v. CC vide Final Order No. 1019-1026/05 dated 28.6.2005, wherein an identical matter pertaining to import of second hand photocopy machines was dealt with. In the case of M/s Office Devices, the Tribunal had noted a large number of judgments rendered in the case of Atul Commodities (P) Ltd. reported in 2005 (184) ELT 135 (Tri.-LB) and has held that import of second hand machine as capital goods and there is no necessity to take Licence under the EXIM Policy.
(ii) With regard to valuation of second hand goods, the Tribunal has relied on the Apex Court judgments rendered in the case of Tolin Rubbers Pvt. Ltd. v. CC, Cochin ; Gajra Bevel Gears v. CC, Bombay .
(iii) He also submits that the transaction value is required to be accepted when there is no proof of any sum having been sent by the appellants through any other source. They have produced the proof of transfer through bank which should be accepted as the correct value.
(iv) He also contended that minor discrepancies in the quantity of goods cannot be a ground for discarding the transaction value declared by the importer as held by the Tribunal in the case of International Trade and Affairs v. CC, Hyderabad .
(v) He also relied on a number of Orders-in-Appeals of the same Commissioner who has upheld the transaction value: 2/05 Cus dated 31.1.2005; 3/05 Cus. dated 31.1.2005; and 4/05 Cus. dated 31.1.2005.
(vi) He submitted that non-production of manufacturers invoice cannot be a ground to reject the transaction value in respect of second hand goods as held in the following judgments.
(a) Ruby Mills Ltd. v. CC, Mumbai .
(b) Anish Kumar Spinning Mills v. CC, Tuticorin .
(vii) He also submitted that Rule 10(1) of CVR 1988 is not substantive provisions governing determination of the value as held in the case of Venus Installation Products Manufacturing Co. v. CC, Goa .
(viii) He contended that the transaction value cannot be rejected except for any of the grounds stated under 4(2) of the Customs Valuation Rules, 1988, which are not present in the present case. He relied on the ratio of the following rulings.
(a) Eicher Tractors Ltd. v. CC, Mumbai
(b) Tolin Rubbers Pvt. Ltd. v. CC, Cochin
(c) Mirah Exports Pvt. Ltd.
(d) Valdilal Dairy International Ltd. 2005 (180) ELT 436 (SC)
(e) Jindal Strips Ltd. v. CC, New Delhi
(f) Om Shiv Enterprises v. CC (Airport), Chennai
(ix) He contended that the RF has to be fixed as 10% of value of goods and penalty 5% of the value of goods as held in the case of Big Apple Computer v. CC, Hyderabad vide Final Order No. 231 and 232/2005 dated 14.2.2005 passed in Appeal Nos. C/31/2003 and C/39/2003 and Final Orders No. 957 and 958/2005 dated 20.6.2005 passed in Appeal Nos. C/241/02 and C/236/04 and also in the case of Rex Printing Press, Bangalore v. CC, Kolkata vide Final Order No. 1980/04 dated 15.12.2004 passed in Appeal No. C/200/04.
(x) He also submits that the internet price is not reliable and it is not the basis for rejecting the declared transaction value. He relied on the Tribunal ruling rendered in the case of Aggarwal Distributors (P) Ltd. v. CC, New Delhi which has been confirmed by the Apex Court reported in 2000 (122) ELT A121 (SC). He also relied on the ruling rendered in the case of Competent Business Machines v. CC, Trichirapalli wherein it has been held that data from internet cannot be used to enhance the value and hence, it cannot be accepted.
4. The learned SDR reiterated the findings given by the authorities below.
5. On a careful consideration, we notice that the transaction value has been rejected and the authorities have proceeded to enhance the transaction value solely on the basis of internet price. In terms of the cited judgments, the internet price cannot be considered for enhancing the transaction value. There is no proof that the appellant having paid extra money. They have produced evidence of transmission of money through bank. In view of the cited judgments, enhanced value is set aside and the declared transaction value is accepted. In so far as, the question of confiscation of the item is concerned, the Commissioner has noted that the personal computers are specifically excluded from freely importable second hand capital goods under para 2.33 of the Handbook of Procedures and the peripherals such as computers, printers are automatically excluded and being a computer peripherals, the goods cannot be called as “capital goods” independently. Therefore, he has upheld the confiscation and has imposed fine and penalty. The Counsel has relied on a large number of Tribunal judgments wherein the fine and penalty has been fixed in similar cases at 10% of the transaction value and penalty at 5% of the value as held in the case of Big Apple Computer v. CC, Hyderabad vide Final Orders No. 957 and 958/2005 dated 20.6.2005. In view of this judgment, we direct the authorities to release the goods on payment of redemption fine at 10% of the transaction value and penalty also at the rate of 5% of the transaction value. The impugned orders are modified inasmuch as the enhancement of transaction value is set aside. The confiscation is upheld however granting redemption fine of 10% of transaction value and penalty of 5% of transaction value. The appeals are allowed in the above terms.
(Operative portion of this Order was pronounced in open court on conclusion of hearing)