Contemporaneous evidence prevails over unsupported expert opinion on imported moulds; exemption, value enhancement and penalties failed.

Contemporaneous purchase order, drawings, photographs and the supplier's certificate showed that the imported plastic injection moulds were made to specification and were not proved to be second hand goods. The Chartered Engineer's report was treated as only corroborative, because it lacked factual particulars and did not address the visible etching or alleged wear and tear. On that basis, denial of exemption under Notification No. 22/2013 and the EPCG scheme was not justified. The record also lacked a rational basis for rejecting the declared transaction value, so the enhancement of value, confiscation, redemption fine and penalty could not be sustained.

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Issues: (i) Whether the imported plastic injection moulds were second hand goods so as to be ineligible for exemption under Notification No. 22/2013 and the EPCG scheme; (ii) Whether enhancement of value and the consequential confiscation, redemption fine and penalty could be sustained.

Issue (i): Whether the imported plastic injection moulds were second hand goods so as to be ineligible for exemption under Notification No. 22/2013 and the EPCG scheme.

Analysis: The purchase order, drawings and photographs showed that the moulds were made to the appellant's specifications and bore the etching of the appellant's name. The overseas supplier's certificate also supported the claim that the goods were new. The conclusion of the Chartered Engineer that the goods were used was not supported by adequate factual particulars, and the report did not account for the visible etching or explain wear and tear. The Court treated the expert opinion as corroborative rather than conclusive and preferred the contemporaneous documents and photographs.

Conclusion: The goods were not proved to be second hand capital goods, and the denial of exemption under Notification No. 22/2013 and the EPCG scheme was not justified.

Issue (ii): Whether enhancement of value and the consequential confiscation, redemption fine and penalty could be sustained.

Analysis: The record did not disclose satisfactory reasons for rejecting the declared transaction value or for arriving at the enhanced assessable value. Since the finding that the goods were used could not be sustained, the consequential demands and penal action based on that premise also lacked legal support. The confiscation, redemption fine and penalty were therefore unsustainable on the facts found.

Conclusion: The enhancement of value and the consequential confiscation, redemption fine and penalty were unsustainable.

Final Conclusion: The appellant was entitled to the benefit of exemption, and all consequential duty and penal consequences were set aside.

Ratio Decidendi: Expert opinion on the condition of imported goods is only corroborative and cannot displace contemporaneous documentary evidence and photographs showing that the goods were manufactured to specification and not proved to be second hand; rejection of declared value also requires a stated and rational basis.

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