2000 (2) TMI 379 - AT - Customs

Summary

Issues:
1. Violation of principles of natural justice in passing the adjudication order.
2. Enhancement of assessable value based on quotations and models not imported by the appellant.

Issue 1: Violation of Principles of Natural Justice
The appellants contested that the adjudication order was passed unfairly as it was conducted by one Additional Commissioner but passed by another, without granting them a hearing opportunity. The Tribunal acknowledged this discrepancy, noting that the order was indeed passed by a different officer than the one who conducted the adjudication. Citing the precedent set in the case of Komal Offset, the Tribunal held that such a practice violates the principles of natural justice. The Commissioner of Customs (Appeals) also recognized this flaw in the process. Consequently, the Tribunal concluded that the adjudication order was indeed passed in contravention of the principles of natural justice.

Issue 2: Enhancement of Assessable Value Based on Quotations
Regarding the enhancement of the assessable value of the imported cordless telephones, the revenue relied on quotations from M/s. Electronics Co. Ltd., Hongkong. However, the appellants argued that this increase was unfounded as the revenue only considered one import by M/s. Rishi Exports, which involved a different model (LS 825) not imported by the appellants (models WT 3990, JKL 608, and LS 827). The Tribunal referenced the case of Laxmi Colour Lab, where it was established that enhancing the value solely based on quotations is impermissible under Sec. 14 of the Customs Act. Furthermore, the Tribunal highlighted that the appeal filed by the revenue against this decision was dismissed by the Hon'ble Supreme Court. Therefore, the Tribunal found the revenue's basis for enhancing the value inadequate and unsustainable.

In conclusion, the Tribunal set aside the impugned order, allowing the appeal in favor of the appellants based on the violations of natural justice in passing the adjudication order and the insufficient grounds for enhancing the assessable value of the imported cordless telephones.