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TMI Blog2025 (3) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority, directing loading for the imports covered for the period 2003-04 to 2013-14, was found to be unjustifiable to the extent of imports beyond five years from the relevant date, that the specific imports intended to be covered and those to be excluded, consequent upon the impugned order, remains unknown. The impugned order is far from clear about to the reasons for limiting the additions to five years if, as stated in the order impugned before that authority, intent was to enable finalisation of provisional assessments. On the other hand, if the intent was to recover duty short-paid by reasons of evidence of the ingredients enumerated in section 28 of Customs Act, 1962 for invoking the period beyond the normal period of limitation, there should have been a finding of evidence to that effect consequent upon the importer being placed on notice of intent to invoke extended period of limitation as well as the consequential penalties specifically noted in such finding. Conclusion - It would appear that the appeal before the first appellate authority had not been examined in terms of outcome of differential duty or evaluation of correctness of declared value in specific bills of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel for the appellant submitted that several decisions of the Tribunal, viz., in Commissioner of Customs, Mumbai v. BASF Strenics Pvt Ltd [2006 (195) ELT 206 (Tri.-Mumbai)], in Sandvik Asia Pvt Ltd v. Commissioner of Customs (Import), Mumbai [2015 (329) ELT 493 (Tri.-Mumbai)], in Kruger Ventilation Industries (North India) Private Ltd v. Commissioner of Customs (Import), New Delhi [2022 (5) TMI 496 - CESTAT NEW DELHI], in Samsonite South Asia Pvt Ltd v. Commissioner of Customs (Import), Mumbai [2015 (327) ELT 528 (Tri.-Mumbai)], in Richmont India Pvt Ltd v. Commissioner of Customs, New Delhi [2016 (343) ELT 209 (Tri.-Del.)] and in Commissioner of Customs v. Ferodo India Pvt Ltd [2008 (224) ELT 23 (SC)] have settled the scope for addition in their favour. Further reliance was placed on the decision of the Tribunal in Commissioner of Customs (Import), Mumbai v. BHEL GE Gas Turbine Service Ltd [2014 (314) ELT 297 (Tri.-Mumbai)]. 3. Learned Authorised Representative placed reliance on the decision of the Hon'ble Supreme Court in Matsushita Television & Audio (I) Ltd v. Commissioner of Customs [2007(211) ELT 200 (SC)]. 4. On a perusal of the records, we find that the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dicate that the issue of such show cause notice had been waived by the importer, it would appear that loading was directed under provisions other than section 28 of Customs Act, 1962; nor is it a proceedings for finalizing of assessment under section 18 of Customs Act, 1962. It would, therefore, appear that these proceedings are vitiated for lack of show cause notice and appear to have been initiated beyond the provisions of law - inferred thus from the contents of the findings of the lower authorities inasmuch as these purport to be directions that are not conclusions traceable to proposals in proceedings initiated under section 28 of Customs Act, 1962. From that lack, it may be deduced that such direction from the specialized wing are neither final orders under section 17 of Customs Act, 1962 and under section 18 of Customs Act, 1962 nor that under section 28 of Customs Act, 1962 all of which devolve on 'proper officer' only but those determined by an officer of customs who is not. To be specific, these are not orders for recovery of duty short-paid or not paid, and, consequently, question of jurisdiction vesting in the first appellate authority, under section 128 of Customs Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'services' would also be subject to duties of customs. 5. That the ostensibly peripheral unit, which once upon a time, was designated to scrutinize relationships and prices for guarding against deliberate undervaluation on the first count and non-inclusion of the other counts and established as a support to assessing authorities at the major custom houses, continued to examine such transactions could hardly be cause for cavil. It is the presumption that directory authority over 'proper officer' was available then and to this day - and long after the exigency that prompted the vestment of such authority has ceased - that is of concern and, more unavoidably so, in the light of the ruling of the Hon'ble Supreme Court in Canon (India) Pvt Ltd v. Commissioner of Customs [2021 (376) ELT 3 (SC)]; especially presumption on the part of the appellant that assessment has been rendered by Commissioner of Customs (Appeals), standing in for Special Valuation Branch (SVB), is apparently shared by the jurisdictional Commissioner of Customs, evident from filing appeal before the first appellate authority. We take note that Special Valuation Branch (SVB) (or GATT Valuation Cell (GVC) as it is vari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rectified in the last version and the other substantially circumscribed for further elimination of the remaining risk. Though neither is pertinent to the present dispute, we take note of these, all the same and briefly, as mirroring the altered perception on value notwithstanding the view then that the deemed framework of 'assessable value' continued, in a manner, alongside 'transaction value' and that 'shifting of burden' principle should relieve tax administration from having to conclusively establish undervaluation as a pre-requisite for enhancement in accordance with the prescribed methods. Thus, between 1988 and 2007, Customs Act, 1962 enunciated the underlying principle of valuation thus '14. (1) For the purposes of the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force whereunder a duty of customs is chargeable on any goods by reference to their value, the value of such goods shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade, where the seller and the buyer have no i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uyer and the seller shall be deemed to be related; (ii) the manner of determination of value in respect of goods when there is no sale, or the buyer and the seller are related, or price is not the sole consideration for the sale or in any other case; (iii) the manner of acceptance or rejection of value declared by the importer or exporter, as the case may be, where the proper officer has reason to doubt the truth or accuracy of such value, and determination of value for the purposes of this section : (iv) the additional obligations of the importer in respect of any class of imported goods and the checks to be exercised, including the circumstances and manner of exercising thereof, as the Board may specify, where, the Board has reason to believe that the value of such goods may not be declared truthfully or accurately, having regard to the trend of declared value of such goods or any other relevant criteria: ......' elevating the erstwhile 'gold standard' as the essence of the valuation scheme. 'Related' was defined in rule 2(2) of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 that was notified simultaneously. Rule 10 and rule 12 therein set out th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer shall, after taking into account all relevant material which he has gathered, determine the value to the best of his judgement.' in Customs Valuation Rules, 1963 not only afforded wide latitude to officers of Customs but also epitomized the broad construction that could be placed on the several provisions in the scheme in stark contrast with the ordered and definitive engagement engendered by the later sets of rules. In an era of rudimentary communication systems with little transnational interface, mostly manual functioning and limited staffing, existence of a specialized establishment, for undertaking scrutiny of transactions among related persons or where value of services was to be determined, is attractive. Availability of information at their fingertips or 'work desks' eliminated that supplement but it's continuance could only have been of assistance in assessment. We emphasize particularly on assistance because the 'proper officer' must reign influenced if assessment is to responsible and responsive. Though Special Valuation Branch (SVB) may advise and recommend, any direction or mandate to assess in a particular way or to issue notice for recovery is anathema to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tory empowerment; notwithstanding, the arrogation of direction, one way or the other, by the Deputy Commissioner, Special Valuation Branch (SVB), its recommendatory character cannot be elevated to that of an order in the absence of statutory support. In keeping with the tentativeness of the findings of this internal advisory mechanism, assessments, guided by the findings, are retained as provisional, under section 18 of Customs Act, 1962, till finalization on a future date. It is that potential as a trigger for resort to provisional assessment that is impugned here. As on the date of the order-in-appeal imposing the guideline, no import had been subject to it. Nor is there any record of any detriment to importers thereafter and, if an irreversible detriment had been imposed, appeal would have been resorted to as surely as night follows day. Customs Act, 1962 is concerned with levy of duty, as well as the enforcement of prohibitions, under law, on import/export goods. Other consequences such as differential duty, refund, drawback, fines and penalties may arise but only in consequence. The possible detriment that may arise on a future date is not a grievance that should be entertaine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate authority. It is only then that appellate jurisdiction commences existence. The first appellate authority should have dealt with the appeal, at the behest of jurisdictional Commissioner of Customs, within such circumscribing and passed such order as is legal and proper for disposal of appeal. Notwithstanding the lack of appellate recourse, that the jurisdictional Commissioner of Customs opted for review does not fall within our empowerment, or that of Commissioner of Customs (Appeals), to prevent; but it is certainly within empowerment to render appropriate disposal in terms of our exposition on the true nature of Special Valuation Branch (SVB) supra.' and concluded such to be advisory that could not bind 'proper officer' who, while relying on the outcome of investigation, necessarily had to appraise the value, in accordance with the relevant Rules, on its own merit. 10. It would appear that the appeal before the first appellate authority had not been examined in terms of outcome of differential duty or evaluation of correctness of declared value in specific bills of entry which alone could have been cause of grievance and, more particularly, in terms of the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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