1999 (9) TMI 609

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.... "Heavy Melting Scrap". The consignment in relation to Appeal No. C/187/99-A was 19.17 metric tonnes valued at US $ 2587.95 covered by invoice No. BFS002, dated 29-5-98. The goods covered in Appeal C/188/99-A were 11.690 metric tonnes valued US $ 2400.99 covered by invoice No. BFS001, dated 23-5-98. On the import of the above mentioned goods, the importers paid duty on the declared value. On examination by the Customs authorities, it was revealed that in the first case there were 30 diesel engines of Nissan brand and 6 of Toyota brand. In the second case there were 40 diesel engines of Nissan brand. On detecting the existence of these types of machines, notices were issued calling upon the importers to show cause why the value of the diesel....

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....owing effect :- "29. The CIF value of the imported second hand diesel engines is fixed at Rs. 8846.53 per piece. 30. The used diesel engines imported vide B/E No. 000070, dated 4-7-98 and having CIF value of Rs. 3,53,861.00 are hereby confiscated under Section 111(d) and 111(m) of the Customs Act, 1962. 31. The HM scrap having CIF value of Rs. 74,610.00 are confiscated under Section 119 of the Customs Act, 1962. 32. The used diesel engines as well as the HM scrap are allowed to be redeemed on payment of a total fine of Rs. 5,50,000.00 (rupees five lakhs and fifty thousand only). 33. I impose a penalty of Rs. 1,00,000.00 (Rupees one lakh only) on the importers under Section 112(a) of the Act ibid." The above mentioned order....

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....ear box is an integral part of the car engine and in finding out the value of the engine, the price of gear box has to be deducted. This is a fundamental error committed by him. In his report for arriving at the value of the engine at Rs. 4200.00, the method used by him is as follows :- (a)     He tentatively fixes the value of the engine at Rs. 30,000.00. (b)     Then he deducts Rs. 4000.00 as margin of profit. (c)      Thereafter, he deducts cost of gear box and self to an extent of 35%. (d)     Another amount of Rs. 10,000.00 is deducted as the cost of rebuilding the engine. (e)     Then cost of warehousing, freight and....