2011 (3) TMI 815 - HC - Customs

Speaking order - Section 17(5) was introduced with effect from 13-7-2006 the date on which Act 29 of 2006 came into force - The decision relied on by the learned standing counsel appearing for the respondents was delivered on 31-3-2006 prior to the introduction of Section 17(5) of the Act - In view of the amendment brought about by Act 29 of 2006 the decision relied on by the learned standing counsel can have no application - In such circumstances as the dispute is regarding the value of the goods and the importer has not accepted in writing the assessment of the 3rd respondent - Therefore, the 3rd respondent was bound to pass a speaking order within 15 days from the date of assessment of the bill of entry namely within 15 days from 10-5-2010 - In the instant case the said period of 15 days has expired -Held that - it will be open to the petitioner to challenge the assessment made by the 3rd respondent by filing an appeal within the period of 60 days computed from the date on which a speaking order is passed under Section 17(5) of the Act.

Summary

Issues:
1. Assessment of customs duty based on load factor without a reasoned order.
2. Interpretation of Section 17(5) of the Customs Act, 1962 regarding passing a speaking order by the assessing officer.
3. Right of the importer to file an appeal under Section 128 of the Act.

Analysis:
1. The petitioner, a private limited company importing furniture, challenged the assessment of customs duty by the respondents, which included a load factor of 28.37% without providing a reasoned order. The petitioner contended that the assessment lacked a speaking order, depriving them of the right to appeal under Section 128 of the Customs Act, 1962. The petitioner sought a writ of mandamus directing the assessing officer to issue a speaking order explaining the enhancement of the declared transaction value.

2. The main contention revolved around the interpretation of Section 17(5) of the Customs Act, 1962. The petitioner argued that as they did not confirm in writing the assessment made by the assessing officer within 15 days, as required by the section, the officer was obligated to pass a speaking order. The respondents, however, argued that an appeal could still be filed even without a reasoned order. The court analyzed the provisions of Section 17(5) and emphasized the necessity of a speaking order when the importer disputes the valuation of goods and does not confirm the assessment in writing.

3. The court highlighted that the introduction of Section 17(5) in 2006 mandated the passing of a speaking order within 15 days of assessment when the importer disputes the valuation. Despite the respondents' reliance on a previous decision, the court emphasized the applicability of the amended provision. The judgment directed the assessing officer to pass a speaking order within 30 days, allowing the petitioner to exercise their right to appeal within the statutory time frame under Section 128 of the Act.

In conclusion, the judgment addressed the issues of assessment without a reasoned order, the importance of a speaking order under Section 17(5) of the Customs Act, and the right of the importer to appeal the assessment. The court's decision provided clarity on the procedural requirements and upheld the petitioner's right to challenge the assessment through the proper legal channels.