D.N. Lal, Member (T)

1. Briefly the facts of the case are that the appellants imported two old re-conditioned printing machines of East German origin through M/s. Induscandia Erikson Co. AB, a party from Sweden. A partner of the appellants' firm specifically went abroad to see the machines and to conduct negotiations for purchase of the same The negotiated price for the two machines was S.Kr. 2,00,000 for both the machines. In pursuance of this deal, a proforma invoice No. LG/GI 83100, dated 3-1-1983 was sent by the supplier.' The said invoice had been prepared with reference to the negotiated price, namely, S.Kr. 2,00,000. A letter of credit was opened by the appellants on 28-2-1983 with Grindlays Bank p.l.c, New Delhi. As the importation was being effected under Open General Licence under 1982-83 Import Policy, as per the requirement of the OGL, a certificate was furnished by the foreign supplier giving specifications of the two machines and certifying that the machines were not more than 10 years old and had expected residual life of 10-12 years at the time of importation. A home consumption bill of entry was filed by the appellants showing therein the c.i.f. value of Rs.