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TMI Blog2013 (6) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... The importer had no opportunity to call upon the proper officer to disclose the grounds because the record would indicate that after the importer submitted a letter dated 25 February 2013, the Deputy Commissioner of Customs proceeded to dispose of the case by passing the impugned order dated 19 March 2013. By failing to inform the importer of the grounds of his doubt and of allowing the importer an opportunity of being heard with reference to those grounds, there has been a clear breach of principles of natural justice. There has been a clear breach of the principles of natural justice by the failure on the part of the Deputy Commissioner of Customs to follow the mandatory requirement of Rule 12. The existence of an alternate remedy of an appeal is not a bar to the maintainability of a petition under Article 226 of the Constitution where there is a breach of the principles of natural justice - thus allowing the petition by setting aside the impugned order remanding back for a decision afresh. - Writ Petition No. 1101 of 2013 - - - Dated:- 10-5-2013 - Dr. D. Y. Chandrachud And A. A. Sayed, JJ. For the Petitioners : Mr. J. J. Bhat, Senior Advocate with Mr. Kishan Kuma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . According to the Petitioners, Rule 12 mandates that when the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, the importer can be called upon to furnish further information. However, on the request of the importer, the proper officer is required to intimate to him in writing the grounds for doubting the truth or accuracy of the value declared in relation to the goods imported and provide a reasonable opportunity of being heard before taking a final decision. In the present case, it is submitted, there was a patent violation of the principles of natural justice because the mandatory requirement of disclosing the grounds for doubting the truth or accuracy of the value declared was not fulfilled and hence, the mere holding of a personal hearing would not comply with the requirement of Rule 12. 5. An affidavit in reply has been filed by the Deputy Commissioner of Customs. The contention is that Rule 12 will apply only when a buyer and seller are not related as envisaged in rule 3(1). The defence is that when the supplier and importer are related persons, Rule 12 will not apply. Moreover, the following defence is taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted goods indicate that the relationship did not influence the price. (b) In a sale between related persons, the transaction value shall be accepted, whenever the importer demonstrates that the declared value of the goods being valued, closely approximates to one of the following values ascertained at or about the same time: (i) the transaction value of identical goods, or of similar goods, in sales to unrelated buyers in India; (ii) the deductive value for identical goods or similar goods; (iii) the computed value for identical goods or similar goods; Provided that in applying the values used for comparison, due account shall be taken of demonstrated difference in commercial levels, quantity levels, adjustments in accordance with the provisions of rule 10 and cost incurred by the seller in sales in which he and the buyer are not related; (c) substitute value shall not be established under the provisions of clause (b) of this sub-rule. 9. Rule 12 provides for the rejection of the declared value, and is as follows:- 12. Rejection of declared value (1) When the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any impor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocedure for rejection of declared value in cases where there is reasonable doubt that the declared value does not represent the transaction value. Where the declared value is rejected, the value has to be determined by proceeding sequentially in accordance with rules 4 to 9. In the present case, the grievance of the Petitioners turns upon an alleged non-compliance of the provisions of sub-rules (1) and (2) of rule 12. 11. Under sub-rule (1) of rule 12, when the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, he may ask the importer of such goods to furnish further information. This information sought may include documents or other evidence. If, after receiving such further information, or in the absence of a response of the importer, the proper officer still has reasonable doubt about the truth or accuracy of the value so declared, it shall be deemed that the transaction value of such imported goods cannot be determined under the provisions of sub-rule (1) or rule 3. Sub-rule (2) of rule 12, provides that at the request of an importer, the proper officer shall intimate to the importer in writing the grounds for dou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld indicate, the procedure which is laid down in Rule 12 was not followed. The proper officer initially called upon the importer to submit documentary material. This was in compliance with the requirements of Rule 12(1). Upon scrutinising the material, evidently the proper officer had reason to doubt the truth or accuracy of the transaction value declared by the importer. The proper officer was required to formulate the grounds on which he entertained a doubt in writing and to furnish them to the importer. The importer had no opportunity to call upon the proper officer to disclose the grounds because the record would indicate that after the importer submitted a letter dated 25 February 2013, the Deputy Commissioner of Customs proceeded to dispose of the case by passing the impugned order dated 19 March 2013. By failing to inform the importer of the grounds of his doubt and of allowing the importer an opportunity of being heard with reference to those grounds, there has been a clear breach of principles of natural justice. 14. We are not inclined to accede to the submission of Counsel appearing on behalf of the Respondents that the Petitioners should be relegated to the remedy of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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