2024 (9) TMI 123 - AT - Customs

Levy of differential duty arising from adoption of US 2.83/kg as value of knitted polyester fabrics after rejection of declaration of US 1.60/kg, US 1.58/kg and US 1.60/kg respectively - speaking order or not - non-conformity with section 17(5) of Customs Act, 1962 - HELD THAT - There is no doubt that, in Sodagar Knitwear 2018 (5) TMI 686 - CESTAT NEW DELHI , the Tribunal did reiterate that admissions do not have to be proved but the crucial question of such admittance having been made in the present dispute is not apparent. It is quite possible that acceptance, as noted in bill of entry, may be construed as sufficing agreement with the revision in value but it appears to us that this conclusion therein, as well as in Sumridhi Aluminium (P) Ltd 2023 (9) TMI 1402 - CESTAT DELHI , in re Namo Alloys Pvt Ltd 2023 (12) TMI 15 - CESTAT CHANDIGARH and in re Hanuman Prasad Sons 2020 (12) TMI 1092 - CESTAT NEW DELHI , had, as its basis, conformation of acceptance of assessment and, thereby, holding that right of appeal was not in concatenation with the disputation of revision even though the former has no support without the latter. It is found that the circumstances of non-conformity with section 17(5) of Customs Act, 1962 have not been examined by the first appellate authority. Nor did the authority have the benefit of the decision of the Tribunal re Sumridhi Aluminium (P) Ltd, in Namo Alloys Pvt Ltd and in re Hanuman Prasad Sons setting out the legal prescription in the stated circumstances. We find these decisions are categorical in setting out the provisions of section 17(5) of Customs Act, 1962 which is relevant inasmuch as it is common ground that no speaking order has been passed. The impugned order is set aside - the dispute remanded back to the first appellate authority for fresh determination - appeal disposed off by way of remand.

Summary

Issues:
1. Appeal against assessment of differential duty on knitted polyester fabrics.
2. Compliance with section 17(5) of Customs Act, 1962 for speaking order.
3. Implied acceptance of assessment by importer.
4. Confirmation of revised assessment by importer.
5. Entitlement to speaking order based on departmental comments in the bill of entry.
6. Examination of non-conformity with section 17(5) by the first appellate authority.

Analysis:

1. The appeal challenges the order of the Commissioner of Customs, which upheld the assessment of differential duty on knitted polyester fabrics by adopting a higher value than declared in the bills of entry. The appellant contested the assessment but the Commissioner dismissed the appeal, citing justifications from the department regarding contemporaneous imports and DRI alert letters.

2. The main issue revolves around the compliance with section 17(5) of the Customs Act, 1962, which requires a speaking order when a reassessment is contrary to the self-assessment by the importer. The impugned order did not provide a speaking order, and the acceptance of assessment was not confirmed in writing as mandated by law.

3. The argument raised by the appellant's counsel was that no confirmation of the revised assessment was communicated or sought from them. The contention was that without a written confirmation of acceptance, implied acceptance does not suffice for compliance with section 17(5) of the Customs Act, 1962.

4. The Authorized Representative argued that the appellants had accepted the assessment by their actions, and departmental comments in the bill of entry indicated acceptance. He relied on previous Tribunal decisions to support the stance that acceptance of assessment was evident and entitled the appellants to a speaking order.

5. The Tribunal analyzed previous decisions and highlighted the importance of written confirmation of acceptance for a speaking order. The lack of a clear confirmation of acceptance in the present case led to the conclusion that the issue of acceptance was not adequately addressed by the first appellate authority.

6. Ultimately, the Tribunal set aside the impugned order and remanded the dispute back to the first appellate authority for a fresh determination. The decision emphasized the need for a proper examination of non-conformity with section 17(5) of the Customs Act, 1962 and the importance of a speaking order in cases of disputed assessments.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the Tribunal's decision regarding compliance with legal requirements in customs assessments.