2024 (3) TMI 509 - AT - Customs

Amendment to bill of entry - Violation of principles of natural justice - price variation clause - volume discount - request for provisional assessment not considered - amendment of the Bills of Entry under Section 149 of the Customs Act, 1962 not considered by the proper officer - HELD THAT - The agreement dated 05.07.2014, as amended on 01.01.2016, has the price variation clause on account of volume discount, which is determinable only at the end of the contract period. The price variation clause is very much available in the contract at the time of filing in the Bills of Entry. As the price was not final at the time of filing of the Bills of Entry, the proper officer should have considered the provisional assessment before final assessment. Had their request for provisional assessment has been considered by the proper officer, the necessity for amendment would not have arisen. The Bills of Entry were initially assessed without giving an opportunity to the appellant for submitting the documentary evidences required for considering amendment of the Bills of Entry - the reason given by the ld. Commissioner (Appeals) for rejecting their request for amendment is not proper. The agreement submitted by the appellant has a price variation clause, which clearly states that the discount can be determined only at the end of the contract period. As the price declared in the Bills of Entry were not the final price, final assessment was not possible. Thus, the proper officer should have considered their request for provisional assessment. Since, provisional assessment was not considered, the appellant sought amendment of the Bills of Entry after receipt of the credit notes on account of price variation. The amendment requested by the appellant should have been considered by the ld. Commissioner (Appeals), as the documentary evidences as provided under section 149 of the Customs Act, 1962, were available even at the time of filing of the Bills of Entry. The impugned order set aside - matter remanded back to take into account the credit note submitted by the appellant as documentary evidence as necessitated under the provisions of Section 149 of the Customs Act 1962 and allow the amendment of the Bills of Entry as requested by the appellant and re-assess the Bills of Entry as per the provisions of law - appeals filed by the appellant are allowed by way of remand to the proper officer.

Summary

Issues involved:
The case involves the appellant's request for provisional assessment due to a price variation clause in the imported goods contract and subsequent denial of amendment of Bills of Entry under Section 149 of the Customs Act, 1962.

Provisional Assessment Request:
The appellant imported rock phosphates under a contract with a price variation clause, seeking provisional assessment for four Bills of Entry due to the clause's determinable nature at the end of the contract period. However, the adjudicating authority finalized the assessments without considering the request for provisional assessment.

Amendment of Bills of Entry:
The appellant appealed against the Orders-in-Original, requesting amendment of the Bills of Entry under Section 149 of the Customs Act, 1962. The Commissioner (Appeals) denied the request citing the unavailability of credit notes at the time of initial assessment, as required by the Act for amendments based on documentary evidence.

Appellant's Argument:
The appellant argued that the price variation clause was present in the contract at the time of filing the Bills of Entry, which should have been considered as documentary evidence for amendment. They emphasized that credit notes alone should not be the sole basis for allowing amendments and that the Commissioner (Appeals) overlooked the clause in the contract.

Revenue's Submission:
The Revenue representative contended that the appellant lacked credit notes during the initial assessment, crucial for amendments under Section 149. Referring to a Supreme Court decision, they argued that since the assessment was not challenged, the request for amendment should not be entertained.

Judgment:
The Tribunal found that the price variation clause in the contract was available at the time of filing the Bills of Entry, warranting provisional assessment. It noted that the Bills were assessed without allowing the submission of necessary documentary evidence for amendment. The Tribunal criticized the Commissioner (Appeals) for rejecting the amendment request based on the unavailability of credit notes, as the contract clause itself provided the required evidence. Consequently, the Tribunal set aside the impugned order, remanding the matter for proper consideration of the credit notes as documentary evidence under Section 149 and re-assessment of the Bills of Entry.