Customs valuation of used machinery: depreciation limited to departmental norm where importer's own expert evidence did not justify more

For customs valuation of used machinery, depreciation was confined to 15% because the valuation authority followed an accepted departmental norm and the importer's own Chartered Engineer certificate did not justify a higher allowance. The Tribunal noted that the machine had been used for four years, was described as having exceptional design and construction, and was estimated to have a remaining life of 10 to 15 years. On that material, it found no basis for further depreciation. The enhanced assessable value was therefore sustained and the appeal was rejected.

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Issues: Whether the enhanced customs assessable value of the used machinery by restricting depreciation to 15% instead of 22% was justified.

Analysis: The appeal challenged the refusal to accept a higher depreciation rate and the absence of a separate expert examination by the Assistant Collector. The Tribunal relied on the importers' Chartered Engineer certificate, which described the machine as of exceptional design and construction and assessed its residual life at 10 to 15 years. It noted that the machine had been used only for four years and that the departmental practice was to allow depreciation at 15% on machinery value. On that basis, no ground was found to grant further depreciation.

Conclusion: The restriction of depreciation to 15% was upheld and the appeal failed.

Final Conclusion: The enhanced valuation for customs assessment was sustained and the appeal was rejected.

Ratio Decidendi: Where the valuation authority follows an accepted departmental norm for depreciation and the importer's own expert certificate does not justify a higher allowance, further depreciation need not be granted.

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