The Directorate General of Customs Valuation Karachi has worked out new customs values on the import of new branded heavy motorcycles (250CC to above 1000CC) of various origins keeping in view actual prices prevailing in the international market. According to the new Valuation Ruling No 940 issued by the directorate, the customs values of new branded heavy motorcycles from all origins for model years 2009 to 2013 were determined vide Valuation Ruling No 672/2014, dated 03-04-2014. In order to reflect the actual prices prevailing in the international market, an exercise was initiated in the Directorate General of Customs Valuation for determination of the custom values of new branded heavy motorcycles for model years 2014 to 2016.
Meetings with stakeholders were held which were attended by the importers and representative of M/s Atlas Honda Ltd, M/s Pak Suzuki Ltd and officials from MCC Appraisement (East/West). The importers were requested to furnish the documents including invoices of imports during last three months showing factual value, websites, names and E-mail addresses of known foreign manufacturers of the item in question through which the actual current value can be ascertained, copies of Contracts made/LCs opened during the last three months showing the value of item in question, copies of Sales Tax Invoices issued during last four months showing the difference in price (excluding duty and taxes) to substantiate that the benefit of difference in price is passed on to the local buyers.
The importers during the meeting were of the view that the prices of the subject motorcycles have not increased in the international market. However, they could not submit any corroboratory evidence/documents in support of their contention. They, however, claimed that the market values of the subject motorcycles of model year 2014-2016 are equivalent to the values determined vide previous Valuation Ruling. One of the manufacturers submitted their value proposal on the basis of their import data.
Valuation methods given in Section 25 of the Customs Act, 1969 were followed. Transaction value method in terms of Section (1) of section 25 could not be applied because the requisite information under the law was not available. Identical/similar goods value methods provided in sub section (5) and) (6) of section 25 ibid provided some reference values in respect of import of new heavy motorcycles by renowned local assemblers. Market enquiry in terms of sub section (7) of Section 25 was not found helpful in determining the custom values of the subject motorcycles. Computed values method as envisaged under Sub- Section (8) of section 25 of the Customs Act, 1969 was found applicable as cost of raw material and fabrication charges under clause (a) and amount of profit and general expenses under clause (b) of Sub-Section (8) of section 25 of the Customs Act, 1969, in the country of export, has been reflected in MSRP of the motorcycle manufacturers.
Accordingly, the FOB values of imported new branded heavy motorcycles of various origins have been determined/calculated under computed value method as envisaged under Sub-Section (8) of Section 25 of the Customs Act, 1969, read with Sub-Section (9) of Section 25 of the Customs Act ibid on the basis of MSRP of motorcycles manufacturers after allowing necessary discount on account of domestic taxes and commission/other charges.
The ruling said that the New Branded Heavy Motorcycles, hereinafter specified, shall be assessed to duty/taxes on the Customs Values mentioned against them. In cases where declared/transaction values are higher than the Customs values determined in this ruling the assessing officers shall apply those values in terms of Sub-Section (I) of Section 25 of the Customs Act, 1969. In case of consignments imported by air, the assessing officer shall take into account the differential between air freight and sea freight while applying the Customs values determined in this Ruling.
The Collectors of Customs may ensure that the values given in this Valuation Ruling for the given description of goods are applied by the concerned staff without fail. Any anomaly observed may kindly be brought to the notice of this Directorate General immediately. Customs values determined in the ruling are for the description and specification as mentioned in the tables above of this Ruling. HS Codes are mentioned for illustrative purposes so that valuation ruling values are made accessible to the assessing officers. The assessment shall be finalized on the basis of correct classification after fulfilling requisite formalities related to importability or any other certification required thereon. In addition to this, it is further necessary to verify that there is no misdeclaration of any sort or violation of Import Policy Order or Section 15 of the Customs Act, 1969 or any other law in vogue therein. This Valuation Ruling supersedes Valuation Ruling No 672/2014, dated 03.04.2014, the ruling added.
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