2026-VIL-1773-CESTAT-KOL-CU
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CUSTOMS CESTAT Cases

Customs - Penalty on Chartered Engineers for Valuation of Second Hand Machinery Where the Demand Against the Importers is Set Aside - Appellants, Chartered Engineers, were engaged by the importers under the Board's Circular dated 19.11.1987 to examine and value imported old and used offset printing machinery, and the goods were released on payment of duty on that valuation - Investigation alleged undervaluation by the importers, and penalty was imposed on each Appellant on the allegation that they omitted to ascertain the correct present value independently, rendering the machines liable to confiscation - Appellants contended that they applied reverse indexation on the wholesale price index and depreciation as per the Board's circular, and that their valuation was only a proposal which the proper officer was not bound to accept - Revenue contended that the certificates were issued without proper verification and inspection - Whether penalty on the Chartered Engineers is sustainable when the demand, penalty and confiscation against the importers are set aside - HELD - In the appeals of the main importers decided earlier by the same Bench, the allegation of undervaluation was not corroborated by documentary evidence, and the opinion of the experts of the printing institute was full of discrepancies and could not be used as evidence to enhance the value. The method adopted by the Chartered Engineer was the logical and scientific method, which the Revenue discarded while implicating the Chartered Engineers to prove its case. The entire demand was also held time barred, and the demand, penalty and confiscation against the importers and the penalties on their directors were set aside. Since the confirmed demand, interest and penalties against the main appellants are legally not sustainable, the penalties on the present Appellants also do not survive - The penalties imposed on the Appellants are set aside, and the appeals are allowed with consequential relief, if any, as per law.
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