1996 (2) TMI 458

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....ion value in regard to these six machines and determined the value by the depreciation method, relying on the long standing Custom House practice and certain letters of Ministry of Finance, Department of Revenue. The Collector (Appeals) sustained the order. Hence this appeal by the importer. 2. Learned Counsel for the appellant submitted that neither the original authority nor the appellate authority applied their minds to the acceptability or otherwise of the transaction value of six machines but proceeded arbitrarily to determine the value under Rule 8 of the Customs Valuation Rules, 1988, feeling bound to do so by a misreading of the letters of the Ministry. Counsel further contended that the two authorities did not consider the qu....

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....he outset about the letters of Ministry which have been placed before us. They are dated 19-11-1987 and 4-1-1988. We do not understand these letters as laying down a rigid principle that in all cases second-hand machinery imported must necessarily be valued adopting the depreciation method. The letters in fact only provide guidelines in regard to the depreciation to be allowed, wherever depreciation method is adopted. In every case, as pointed out in Collector of Customs v. Blue Star Industries reported in 1996 (81) E.L.T. 287, it is for the customs authorities to find out whether there is international trade in the particular kind of goods imported and the price of such goods sold or offered for sale for delivery at the relevant time. It i....

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....remand would be desirable. Learned Counsel categorically stated remand is not desirable and requested that the Tribunal may arrive at a proper assessable value in the light of the materials on record. 6. The Ministry of Finance has issued guidelines as to how the depreciation method is to be worked out. The broad framework of the formula is that in each quarter of first year depreciation could be allowed at 4%, in each quarter of the second year depreciation could be allowed at 3% and in each of succeeding years depreciation could be allowed at 2% per quarter, however subject to the condition that the total depreciation allowed cannot exceed 70%. Depreciation method is certainly a reasonable method which has been accepted by the Tribu....