2019 (12) TMI 951 - AT - Customs

Valuation of imported goods - whey protein and other food products - rejection of declared value - enhancement of value on the basis of contemporaneous import price - HELD THAT - Though the appellant have waived the Show Cause Notice, however, the appellant was not put to notice the intention of the revenue for confiscation of the goods. Due to this reason the appellant could not make any defence as regard confiscation of the goods which is consequential to alleged misdeclaration of the value of imported goods. In these circumstances the original order passed by the Adjudicating Authority is ex-parte order without having on record any representation in defence of the appellant. Since the appellant have raised various grounds and the Adjudicating Authority had no occasion to consider the submission now made before Commissioner (Appeals) as well as before this tribunal, the matter needs to be remanded to the Adjudicating Authority - Appeal allowed by way of remand.

Summary

Issues:
1. Jurisdictional authority for SEZ units
2. Confiscation of goods based on misdeclaration of value
3. Ex-parte order due to lack of proper notice

Jurisdictional Authority for SEZ Units:
The case involved the import of goods by an appellant in a unit located in a Special Economic Zone (SEZ). The appellant argued that the confiscation of goods was improper as the order was passed by an officer lacking jurisdiction over SEZ units. The appellant contended that the competent authority for SEZ units is the jurisdictional officer, not the Additional Commissioner who issued the order. The appellant also highlighted that according to specific instructions, any doubt about the declared value of goods from SEZ units should be assessed at the time of clearance for the domestic market, not during warehousing. Therefore, the appellant argued that the value declared in the Bill of Entry should not have been questioned, and the goods were not liable for confiscation based on these grounds.

Confiscation of Goods Based on Misdeclaration of Value:
The dispute arose from the discrepancy in the value declared by the appellant for imported goods and the value determined by the Directorate of Revenue Intelligence (DRI). The Adjudicating Authority rejected the appellant's declared value, ordered the redetermination of the value based on NIDB Data, and imposed penalties under the Customs Act. The appellant argued that there was no evidence of undervaluation as the declared value matched the purchase invoice. The appellant cited a relevant judgment and notifications to support their claim that the declared value was accurate. Conversely, the revenue representative contended that the acceptance of enhanced value by the appellant indicated misdeclaration, justifying the confiscation of goods. The tribunal noted that the appellant was not properly notified of the intention to confiscate goods, leading to an ex-parte order. Consequently, the tribunal set aside the order and remanded the case to the Adjudicating Authority for a fresh decision, keeping all issues open for further consideration.

Ex-Parte Order Due to Lack of Proper Notice:
The tribunal observed that while the appellant had waived the Show Cause Notice, they were not informed of the revenue's intention to confiscate the goods. This lack of notice deprived the appellant of the opportunity to defend against the confiscation based on alleged misdeclaration of value. The tribunal deemed the original order as an ex-parte decision since the appellant's defenses were not considered. Consequently, the tribunal decided to remand the case to the Adjudicating Authority for a fresh order, emphasizing the need for proper consideration of all submissions and issues raised by the appellant during the proceedings.

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