Declared value of used machinery may be rejected when essential valuation particulars are missing and customs valuation is re-determined.

Imported second-hand machinery can have its declared transaction value rejected where the invoice and supporting papers omit essential particulars such as year of manufacture, model number, period of usage, reconditioning details and gross weight. In such circumstances, customs authorities may doubt the genuineness of the declared price and re-determine value under the Customs Valuation Rules, 2007 read with section 14 of the Customs Act, 1962. Contemporaneous material, including an independent Chartered Engineer's valuation, may be relied on to support a higher assessable value. The re-determination of value was therefore upheld against the assessee.

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Issues: Whether the declared transaction value of the imported used machinery was liable to be rejected and the value re-determined on the basis of the Customs Valuation Rules, 2007 read with section 14 of the Customs Act, 1962.

Analysis: The imported goods were second-hand machinery, but the invoice and supporting documents did not disclose essential particulars such as year of manufacture, model number, period of usage, extent of reconditioning, or even gross weight. In the absence of such particulars, the Customs authorities were justified in doubting the declared value. The contemporaneous material, including the independent Chartered Engineer's valuation, supported a much higher assessable value, and the declared price was found to be grossly low when compared with the nature and size of the machinery and the surrounding circumstances.

Conclusion: The rejection of the declared value and its re-determination under the Customs Valuation Rules, 2007 was upheld, and the issue was decided against the assessee.

Ratio Decidendi: Where imported second-hand machinery is not supported by essential identifying and valuation particulars, the customs authorities may reject the declared transaction value and adopt a re-determined value supported by valuation material.

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