2010 (1) TMI 466 - HC - Customs

Natural Justice - The petitioner is a company engaged in the manufacture of High Rupturing Capacity Fuses and Fuse Components. Petitioner ought to be provided sufficient opportunity to submit documents. Held that - denial of opportunity to represent case is in gross violation of principles of natural justice. Impugned order passed in violation of natural justice set aside. Matter remanded for fresh consideration. Value not to be enhanced till adjudication.

Summary

Issues:
Challenge to order passed by respondent on 26-6-2008 regarding valuation of imported goods and inclusion of freight cost in the value.

Analysis:

Issue 1: Challenge to the Order
The petitioner, a company manufacturing Fuses and Fuse Components, challenged the order passed by the respondent regarding the valuation of imported goods. The respondent had ordered a loading of 20% on the import value due to the exclusion of freight cost in the invoice raised by overseas parties. The petitioner appealed this order before the Commissioner of Customs (Appeals), who directed the department to determine the value as per Customs Valuation Rules. The petitioner contended a violation of natural justice principles due to lack of opportunity for personal hearing before the order was passed.

Issue 2: Violation of Natural Justice
The High Court observed that the Special Valuation Branch's procedure should provide the petitioner with an opportunity to establish their contentions. The court noted that the petitioner had engaged legal representation, but the respondent failed to consider the letter seeking to engage counsel, leading to a denial of natural justice. Citing precedents, the court emphasized the importance of an effective personal hearing and the right to legal representation in quasi-judicial proceedings.

Issue 3: Remand for Fresh Consideration
Based on the violation of natural justice, the court set aside the impugned order and remanded the matter for fresh consideration by the respondent in accordance with the law. The petitioner was granted liberty to request necessary documents and representations for a fair adjudication process. The court directed the completion of the entire adjudication within 12 weeks and ordered the maintenance of the status quo regarding loading amounts on the original invoice value until the completion of the adjudication.

In conclusion, the High Court allowed the writ petition, set aside the impugned order, and remanded the matter for fresh consideration, emphasizing the importance of natural justice and legal representation in quasi-judicial proceedings. The court directed a fair adjudication process within a specified timeframe and ordered the maintenance of the status quo during the process.