2022 (2) TMI 633 - AT - Customs

Valuation of imported goods - Fresh Orchid Cut Flowers - enhancement of value - furnishing of NIDB data or not - speaking order in terms of Section 17(5) of the Customs Act 1962 - Applicability of Rule 4 of the Customs Valuation (Determination of Value of Imported Goods) Rules 2007 - HELD THAT - There is no such clear admission by the appellant and the so-called consent is also limited to the flower consignment imported by them with effect from the date of the letter; but however the same was also subject to the final outcome of the decision in respect of the appeals filed by them which means that their challenge to the adoption of the enhanced value was pending in appeal as on the date of the said letter. Vide Orders-in-Appeal the First Appellate Authority had termed as unsustainable and set aside vide orders passed on 27.03.2013 and 29.05.2013. By this it is evident that the so-called consent letter was not a blank cheque to be adopted universally and for all the imports the appellant could ever make. The authorities have nowhere given any acceptable reasons as to why they jumped to adopt Rule 4 ibid. and the valuation prescribed thereunder instead of following the Rules sequentially. From the records nowhere it is seen that the appellant was furnished with the NIDB data or whatsoever that was relied upon for enhancement of the value for rebuttal which is clearly in violation of the principles of natural justice. Appeal allowed - decided in favor of appellant.

Summary

The only issue for consideration in this case was whether the Revenue was justified in adopting the valuation of imported goods in terms of Rule 4 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.The appellants imported 'Fresh Orchid Cut Flowers' and declared the rate at US$ 0.03 per stem in their Bills-of-Entry. However, the Customs Officer rejected this value and enhanced it to US$ 0.07 per stem. The Commissioner of Customs (Appeals) found the assessing authority's action arbitrary and bad in law, setting aside the assessment orders and directing a fresh speaking order. The Original Authority later noted that the importer had given a consent letter agreeing to the valuation at US$ 0.07 per stem, in line with Rule 4 of the Customs Valuation Rules.The Commissioner (Appeals) rejected the appeal on the grounds that the appellant had consented to the enhanced value. The Tribunal analyzed the "consent letter" dated 07.02.2013 and found that it did not constitute a clear admission by the appellant. The consent was limited to the specific flower consignment imported from the date of the letter and was subject to the final decision on the pending appeals challenging the enhanced value.The Tribunal also noted that the authorities had not provided acceptable reasons for jumping to adopt Rule 4 instead of following the Rules sequentially. There was no evidence that the appellant was provided with necessary data for rebuttal, violating principles of natural justice. Additionally, there was no justification for why the declared value of US$ 0.03 per stem could not be accepted, and no reliance on contemporaneous import data of other similar importers was presented.Based on these findings, the Tribunal set aside the impugned order, allowing the appeal with consequential benefits as per the law.In conclusion, the Tribunal held that the Revenue was not justified in adopting the enhanced valuation under Rule 4 of the Customs Valuation Rules. The appeal was allowed, and the impugned order was set aside, providing consequential benefits to the appellant.