2010 (11) TMI 113 - HC - Customs

Provisional assessment Direction of officer Importer seeking provisional assessment - Rules do not permit provisional assessment under Section 18 in a situation where the importer wants to defer assessment for reasons which are attributable to the importer. Section 18(1) of the Customs Act does not make it mandatory on the proper officer to make a provisional assessment. The use of the word may indicates that it is the discretion of the officer to make provisional assessment, if there are circumstances justifying it. What is important to be noted is that this provision incorporated in the statute is to be invoked in situations where on account of the circumstances set out in Section 18 of the Act, the proper officer is unable to assess the customs duty and not where assessment is deferred at the request of the importer. - provisional assessment as sought for by the petitioners was against the provisions of the Act and the Regulations of 1963 and hence, cannot be ordered - the prayer sought to direct the respondents to provisionally assess the cargo of betel nuts imported by the petitioners cannot be granted.

Summary

Issues:
Petition seeking provisional assessment of imported goods under Customs Act, 1962 and Customs (Provisional Duty Assessment) Regulations, 1963.

Analysis:
1. The petitioners, importers of betel nuts, filed writ petitions seeking provisional assessment of their goods imported at the Port of Cochin. They requested the respondents to apply the provisions of the Customs Act, 1962, and the Customs (Provisional Duty Assessment) Regulations, 1963, to release the goods.

2. The Standing Counsel for the respondents contended that duty assessment could be done under Section 17 of the Customs Act, allowing the petitioners to appear before the proper officer for assessment and issuance of speaking orders subsequently.

3. Section 18 of the Customs Act provides for provisional assessment of duty under specific circumstances, such as inability to produce necessary documents, need for testing goods, or further inquiry for duty assessment.

4. Regulation 2 of the Customs (Provisional Duty Assessment) Regulations, 1963, outlines the grounds justifying provisional assessment when the proper officer cannot make a final duty assessment. The importer may execute a bond and deposit a sum for provisional duty assessment.

5. The relevant provision in these cases is Section 18(1)(a) of the Customs Act, which requires the proper officer to be unable to complete assessment due to the importer's inability to provide essential documents or information. The Customs Department expressed readiness to assess under Section 17, indicating no need for additional documents from the petitioners.

6. The court clarified that provisional assessment under Section 18 is not warranted when the importer seeks to delay assessment for their reasons. The discretion to conduct provisional assessment lies with the proper officer in specific circumstances hindering duty assessment, not when assessment is deferred at the importer's request.

7. Consequently, the court ruled that the petitioners' request for provisional assessment was against statutory provisions and could not be granted. However, the proper officer must allow the petitioners a reasonable opportunity to present supporting documents for a meaningful adjudication.

8. The court acknowledged the respondents' assurance that importers could appear before the proper officer for assessment, with orders issued promptly for cargo release. Speaking orders would be provided for further legal recourse against completed assessments.

9. The writ petition was disposed of accordingly, emphasizing the importance of adherence to statutory provisions while allowing importers the opportunity for fair assessment and cargo release based on proper procedures.