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TMI Blog1961 (12) TMI 113X X X X Extracts X X X X X X X X Extracts X X X X ..... f 500 tons vide shipping bill dated 11-9-1952. The price which had to be paid to the petitioner-firm was fixed at 28 dollors per dry ton inclusive of Indian export duty. Since the qualify of manganese ore is variable, it was stipulated that a certain minimum percentage of manganese ore certain minimum percentage of manganese ore must form the content of the commodity shipped. The weight was to be taken of the dry commodity as it appears that in the commodity shipped there is a certain amount of moisture which evaporates after a time. The Indian export duty is 15 per cent to be computed in accordance with section 30 or 31 of the Sea Customs Act (Act No. 8 of 1878). The shippers have to declare the value at port of the commodity shipped and the Excise Department may or may not accept this valuation. If the valuation is not accepted, then export duty is assessed under section 30 or 31 as I have already stated. The petitioner-firm declared the value of the first shipment to be ₹ 8,70,130/6/11 and of the second instalment of 500 tons as ₹ 58,069/9/-. The total of these shipments was, therefore, declared at the figure of ₹ 9,28,200/-. This value was not accepted by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material upon which the assessment was based. It was argued before us that the assessment had been made under Section 30(b) of the Act, whereas the petitioners' claim is that the assessment should have been made under Section 31. (4) The arguments advanced on behalf of the petitioners may be set out under the following four items: (1) The assessment should have been made not under Section 30(b) but under Section 31. (2) The Collector of Customs, Visakhapatnam, did not hear the petitioners. He did not give them an opportunity to explain or rebut the material upon which he had based his order and, in fact, did not even reveal what this material was. His order was not a speaking order, and since an appeal was provided for against his order, the absence of any reasons vitiated the order. (3) When the matter came up before the Central Board of Revenue, the only evidence before it was the declaration of the petitioners regarding the value of the consignments. The Central Board of Revenue however, saw the report of the Collector and the records which were not available to the petitioners and which they, therefore, could not explain or rebut, and for this reason the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be price ruling at the time of shipment. Since the value on which the goods have been assessed by the Customs House is lower than the value on the above basis, the appeal is rejected. A note above the order states that the Collector's report and the records of the case were read and the appellants' counsel was heard. The contents of the Collector's report were not revealed to the petitioners, nor were those portions of the record upon which the Central Board of Revenue relied, shown to the petitioners. The final order of the Government of India dismissing the revision petition is to the following effect: The Government of India have carefully considered the revision application made by the petitioners and also all the facts and circumstances of the case but they see no reason to interfere with the order in appeal passed by the Central Board of Revenue New Delhi. Above this order also there is a note to the effect that the Collector's report and the records of the case were read. (6) It will be seen at once that all the orders, which are being challenged, are not the sort of orders which ought to be passed in quasi-judicial proceedings. The contention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment and the order of the appellate authority should contain reasons upon which the decision is based because it is only by challenging these reasons that an appeal can be filed. In the present case neither the Customs Collector of Visakhapatnam nor the Central Board of Revenue gave any reasons at all for arriving at their assessment . Reliance was also placed upon two decisions relating to Section 23(3) of the Income Tax Act. The first of these is Gunda Subbayya v. Commissioner of Income Tax, Madras [1939]7ITR21(Mad) , in which the following principles were laid down: Though there is nothing in the Act which imposes a duty on an Income Tax Officer who makes an assessment under Section 23(3) in such circumstances to disclose to the assessee the material on which he proposes to act, natural justice requires that he should draw the assessee's attention to it and give him an opportunity to show that the officer's information is wrong. He should also indicate in his order the material on which he has made his assessment as an order under Section 23(3) is appealable. (8) The same opinion was expressed in a somewhat more elaborate form in Gurmukh Singh v. Commissioner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er authority was correct or not. There, although Coagula, C. J., was of the opinion that proceedings under the Sea Customs Act are not quasi-judicial in nature he quite unequivocally stated that the Collector must give reasons, and in the absence of reasons the order was liable to be quashed. The orders, which were being impugned before the Division Bench of the Bombay High Court were, in fact, quashed and the Collector was directed to make a fresh statement in the light of the observations made by Chagla, C. J. Therefore, a distinction in form was made by the Bombay High Court between proceedings under section 23(3) of the Income Tax Act and proceedings under the Sea Customs Act; in substance, the requirements of natural justice were to be observed in both cases. (10) I may also refer to a decision of the King's Bench Division in a matter which arose out of the Housing Act of 1930--Errington v. Minister of Health (1935) 1 KB 249. It was held- If the Minister holds a private inquiry to which the owners are not invited or takes into consideration ex parte statements with which the owners have had no opportunity of dealing he is not acting in accordance with correct pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is of the final assessment. It may again be mentioned that the actual value received by the petitioners was much less than even their declared value. (12) It seems to me, therefore, that the assessments were not made in accordance with law. The orders of the Customs Collector, Visakhapatnam and of the Central Board of Revenue are not speaking orders upon which a memorandum of appeal can be based. There is no indication of the material upon which these two authorities acted. Furthermore, the Collector of Customs, Visakhapatnam, did not give the petitioners a hearing or an opportunity of representing their case and rebutting or explaining the material upon which he acted. There appears to me to be no adequate reason why the quotations given in the trade journal for Calcutta should be accepted as the final word in determining the prices available at Visakhapatnam. I would therefore, accept these petitions and direct that reassessment should be made in the light of the observations made in the judgment. In the Bombay case referred to above a direction was given by Chagla, C. J., that the petitioners would have an opportunity of filing appeals against the reassessment and the limitat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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