P.C. Jain, Member (T)

1. A common order is being passed because both these matters arise out of a common impugned order.

2. Brief facts of the case are as follows :--

2.1 The appellant concern whose proprietor is the second appellant herein imported two second-hand machines, namely, (i) one Heidelberg Speed-master 72 VP, 4 Colour offset printing machine Model, 1983 with declared GIF value at £ 49,000; and (ii) one Stall, K-66/4 Ktl 3 Paper folding machine Model, 1983 with declared GIF value at £ 3,000.00. As per the practice and procedure certificates from Chartered Engineers giving the estimate of the prices as declared aforesaid were also enclosed Chartered Engineers in the present case are M/s. Arcadia Printing and Graphic Machinery (T. Thomas) in respect of both the machines.

2.2 Both the machines were examined on 1-6-1990 by the officers of the Customs under SIB supervision when they were found to be second-hand as declared. Later on, it appears that on the basis of a complaint the said machines were re-examined on 10-7-1990. On the basis of the said re-examination and further enquiry from M/s. MSL Graphics, New Delhi, the local agents of the manufacturers of the two machines, a show cause notice dated 3-7-1990 was issued by the Assistant Collector of Customs, SIB, alleging that the value declared by the appellants was not acceptable and that the value proposed to be enhanced, as indicated in the said show cause notice. On 20-7-1990 the Assistant Collector issued an addendum to the said show cause notice wherein the value of the said two machines was sought to be revised. On the basis of the allegation made therein, it was alleged that the total assessable value of both the machines worked out to Rs. 24,53,428.40 after giving the permissible depreciation as against the total declared value of Rs. 14,50,027.00. It was, therefore alleged that there was under-valuation to the extent of Rs. 10,03,400/- and attempt to evade duty to the extent of Rs. 8,02,721/-. It was further alleged that the goods worth Rs. 20,48,213/- were rendered liable to confiscation under Section 111(d) of the Customs Act, 1962 for the alleged breach of the provisions of Para 30 of AM 1988-91 ITC Policy inasmuch as the said offset printing machine was older than 7 years which alone was permitted under OGL. Hence the importation was alleged to be against the ITC Policy. Basis of the allegation of under-valuation, as spelt out in the show cause notice and upheld in the impugned order is that the local agents M/s. MSL Graphics of the manufacturers indicated the current prices of the machines as follows :--

(1) DM 926500 GIF equivalent to £ 3,37,709 GIF in the case of offset printing machine.

(2) DM 86,790 FOB equivalent to £ 31,635 FOB or £ 38,317.9 GIF in respect of paper folding machine.

However, the Chartered engineers' certificates indicated the current prices at £ 2,00,000.00 GIF and at £ 10,000 GIF respectively. Thus, the Chartered engineers' certificate has been discarded by the adjudicating authority. It has been further found that in the year 1983 Chartered engineers' certificate showed the approximate price of the said printing machine at £ 1,05,000 GIF whereas the price of 982 Model of the said offset printing machine was quoted at £ 1,95,000 in a commercial magazine.

2.3 As regards the paper folding machine from the current price the 1983 price has been deduced on the basis of assumption of linear inflation as has taken place in the case of offset printing machine. Thereafter, a depreciation of 70% was given in respect of the offset printing machine and depreciation of 65% was given in respect of paper folding machine to arrive at the aforesaid under-valuation. On adjudication, after considering the reply of the appellants herein and their submissions at the time of personal hearing, the adjudicating authority has confiscated both the machines under Section 111(m) of the Customs Act and the offset printing machine under Section 111(d) as well. The