2014 (5) TMI 677 - AT - Customs

Valuation of goods - imported goods on the basis of US list price - Undervaluation of goods - Held that - Section 122A specifically provides that the adjudicating authority shall, in any case proceed under this Chapter or any other provision of this Act, give an opportunity of being heard to a party in a proceeding, if the party so desires . In view of the specific provisions under the law, in this case, there is a clear violation of principles of natural justice. - matter remanded back to the original authority to pass orders after observing principles of natural justice in accordance with law. - Decided in favour of assessee.

Summary

Issues involved: Finalization of provisional assessment, violation of principles of natural justice, violation of Section 122A of Customs Act, 1962.

Finalization of provisional assessment: The appeal was filed against the rejection of the order-in-original related to the finalization of provisional assessment due to a dispute about the assessable value of imported goods based on the US list price. The Commissioner adopted undervaluation for subsequent imports from 11.5.2007 to 31.3.2008, leading to a demand of Rs.19,85,21,756 in differential duty. The appellants argued that no personal hearing was granted, alleging a violation of natural justice and Section 122A of the Customs Act. The lower authorities contended that no statutory provision mandates a personal hearing for finalization under Section 18 of the Customs Act.

Violation of principles of natural justice: The Tribunal found a clear violation of natural justice principles as Section 122A of the Customs Act explicitly requires the adjudicating authority to provide an opportunity of being heard to a party in proceedings. Since no personal hearing was granted to the appellants, the impugned order was set aside, and the matter was remanded to the original authority for fresh consideration while ensuring adherence to principles of natural justice and the law.

Violation of Section 122A of Customs Act, 1962: The judgment highlighted the importance of Section 122A, emphasizing that the adjudicating authority must grant a party the opportunity to be heard in any proceeding under the Act. The failure to provide a personal hearing in this case was deemed a violation of this statutory provision, leading to the decision to set aside the impugned order and remand the matter for reconsideration with due observance of natural justice principles and legal requirements.

This comprehensive analysis of the judgment from the Appellate Tribunal CESTAT BANGALORE underscores the significance of procedural fairness and statutory compliance in customs assessment proceedings, ensuring parties are accorded their right to a hearing and decisions are made in accordance with the law.