2008 (4) TMI 84 - AT - Customs

Impugned departmental appeal against the order of the Commissioner (Appeals) by which the order of assessment enhancing the value of imported acrylic sheets was set aside - materials produced by dept. regarding the higher contemporaneous import price have not been considered by the Commissioner - set aside the order of the Commissioner (Appeals) and also the order of assessment and remit the matter to original authority to issue a speaking order

Summary

Issues:
Departmental appeal against order enhancing value of imported acrylic sheets.

Analysis:
The judgment pertains to a departmental appeal against an order enhancing the value of imported acrylic sheets, which was set aside by the Commissioner (Appeals). The departmental appeal was based on NIDB data indicating a unit price of about Rs. 20 per Kg for imports during a specific period. The appellant had initially agreed to the enhancement, leading to no speaking order being issued by the assessing officer. However, the Commissioner (Appeals) set aside the order without calling for any details/records from the assessing authority. The appellant's representative argued that a detailed order specifying the reasons for enhancement would have been issued if the appellant had not consented to it. On the other hand, the respondent's advocate highlighted that the enhancement was done without relying on contemporaneous import prices, and the respondent had accepted the order of assessment due to mounting demurrage and urgent need for the goods. The advocate argued that the right to appeal should not be extinguished by the acceptance and payment of duty on the enhanced value.

The Tribunal carefully considered the submissions from both sides and made general observations for future guidance in similar matters. It emphasized the importance of following principles of natural justice and Customs Act provisions when proposing to enhance a declared value. The Tribunal stressed the need for a transparent procedure, where the importer is given an opportunity to provide views before a decision is made. Referring to Circular No. 91/2003, the Tribunal highlighted that authorities are permitted not to issue speaking orders only when the assessee accepts enhancement in writing. The judgment underscored the importance of following a fair procedure beneficial to both the assessees and the Department.

Regarding the order of the Commissioner (Appeals), the Tribunal noted that there was no system of a departmental representative being present during the relevant period's hearings. It pointed out that the Commissioner (Appeals) should carefully review the basis of assessment orders and take due care in considering relevant materials before passing orders. The Tribunal suggested that the Commissioner (Appeals) could have considered remanding the case with directions to issue a speaking order. Ultimately, the Tribunal set aside the order of the Commissioner (Appeals) and the order of assessment, remitting the case to the original authority for issuing a speaking order, considering the material relied upon for enhancing the value, and providing a reasonable opportunity of hearing to the respondent. The respondent was granted one month to make written submissions, and the original authority was directed to decide the case expeditiously within two months from the submission deadline.

In conclusion, the appeal was allowed by way of remand, emphasizing the importance of following fair procedures and providing opportunities for both parties to present their views in customs valuation matters.