Case Law Details
IBM India (P) Ltd. Vs Commissioner of Customs (CESTAT Bangalore)
CESTAT Bangalore held that section 149 of the Customs Act, 1962 allows amendment of a Bill of Entry after the clearance of the goods only on the basis of documentary evidences which were in existence at the time the goods were cleared for home consumption. In absence of the same, the amendment is unjustified.
Facts- The appellant imported software “SPO” for 5691 XXX CATIA Hybrid Design indicating the value of the software as US$ 21,49,953.610. The said imported software was sold to M/s. Tata Technologies Ltd. The appellant then realised that they had erroneously declared value of imported software to be ₹10,27,30,275/- as against ₹1,91,24,415/- and filed an appeal to reassess their goods and seek refund of the excess duty paid by them. The Commissioner (Appeals) noted that the appellant being registered as an Accredited Client Programme (ACP) and the imports made by such importers are normally facilitated through Risk Management System (RMS); in other words, the goods were cleared without examination based on the transaction value declared in the Bill of Entry and there is no dispute that there was any irregularity in the assessment made at the time of import. The only defense of the appellant was that there was a clerical error committed by them where higher value was declared which resulted in excess payment of customs duty and hence, they sought to reopen the assessment and rectify a clerical error in terms of provisions of section 149 and 154 of the Customs Act 1962.
The Commissioner (A) observed that section 149 allows amendment of a Bill of Entry after the clearance of the goods only on the basis of documentary evidences which were in existence at the time the goods were cleared for home consumption; while Section 154 deals with only clerical mistakes. He held that since, in this case, no such error was committed, Section 154 was ruled out and Section 149 could not be invoked by the appellant. Therefore, in the absence of any verifiable means to determine the intrinsic value of the imported goods that were not available for examination, the request for reassessment of goods was rejected.
Conclusion- Held that that for invoking Section 149, relevant documents should have been in existence at the time of import but in this case, obviously the invoice was revised based on the request of the appellant and the veracity of the genuineness of this invoice could not be verified since the goods were not examined at the time of import nor were available for examination.
In the present case, no documents existed at the time of assessment and the documents produced for amendment were not available at the time of assessment, these surfaced at much later date. The goods were not examined and the invoice produced by the appellant at the time of import had no factual errors and therefore to change the value of the imported goods based on an amended purchase order and revised invoice will not be a simplicitor amendment envisaged under Section 149.
FULL TEXT OF THE CESTAT BANGALORE ORDER
Brief facts of the case are that the appellant, M/s. IBM India Pvt. Ltd., imported software “SPO” for 5691 XXX CATIA Hybrid Design vide Bill of Entry No. 276457 dated 27.11.2009 indicating the value of the software as US$ 21,49,953.610 as indicated in the overseas supplier’s invoice No. CUM97711A dated 26.11.2009. This product was assessed by the group concerned on the basis of the declared value and the duty amounting to Rs. 84,64,975 was paid on 27.11.2009 and thereafter, the goods were cleared for home consumption. Later, the said imported software was sold to M/s. Tata Technologies Ltd. Pune vide invoice No. PCS020 dated 30.11.2009 in terms of the purchase order dated 25.11.2009. The appellant then realised that they had erroneously declared value of imported software to be ₹10,27,30,275/- as against ₹1,91,24,415/- and filed an appeal to reassess their goods and seek refund of the excess duty paid by them. The Commissioner (Appeals) noted that the appellant being registered as an Accredited Client Programme (ACP) and the imports made by such importers are normally facilitated through Risk Management System (RMS); in other words, the goods were cleared without examination based on the transaction value declared in the Bill of Entry and there is no dispute that there was any irregularity in the assessment made at the time of import. The only defense of the appellant was that there was a clerical error committed by them where higher value was declared which resulted in excess payment of customs duty and hence, they sought to reopen the assessment and rectify a clerical error in terms of provisions of section 149 and 154 of the Customs Act 1962. The Commissioner (A) observed that section 149 allows amendment of a Bill of Entry after the clearance of the goods only on the basis of documentary evidences which were in existence at the time the goods were cleared for home consumption; while Section 154 deals with only clerical mistakes. He held that since, in this case, no such error was committed, Section 154 was ruled out and Section 149 could not be invoked by the appellant. Thus, in the absence of the goods which have already been cleared and specific identity of the goods not being available, the Revenue had no recourse route to read it in mind the intrinsic value of the software at a belated date. The Commissioner (A) also noted that the appellant had produced an amended purchase order dated 10.12.2009 amending the value of the imported software as USD 2,34,253.50 which was not in existence at the time of import and did not indicate that the same is related to the transaction already completed. He also notes that though the supplier had indicated to the appellant that they would issue a credit note for the differential amount and there were no documents produced to show that the differential amount was credited and whether the transaction was finalised in their books of accounts of both the supplier and the importer. Therefore, in the absence of any verifiable means to determine the intrinsic value of the imported goods that were not available for examination, the request for reassessment of goods was rejected.
2. The learned counsel on behalf of the appellant submits that their quotation number dated 23.11.2009 given to M/s. Tata technologies Ltd. Pune quoted the correct price and on the basis of this quotation, they had placed the purchase order dated 25.11.2009 on IBM India and IBM India in turn placed a purchase order on “IBM USA” quoting an incorrect higher value on the basis of which the commercial invoice was issued by the supplier and accordingly, excess duty was paid by the appellant at the time of import. It is stated that they realised their mistake and the appellant brought the same to the notice of the supplier and accordingly, the overseas supplier amended the purchase order. Since a Bill of Entry is an appealable order, they filed an appeal for reassessing the Bill of Entry. Since Section 149 allows for amendment of a Bill of Entry, they requested this Tribunal to consider the request to allow the amendment to the Bill of Entry so that they can claim refund of the excess duty paid by them. They also relied on following various judgements:
(i) PPN Power Generating Co. Pvt. Ltd. vs. CC, Trichy: 2016 (344) ELT 891 (Tri.-Chennai)
(ii) Steel Authority of India Ltd. vs. CC, Chennai: 2016 (343) ELT 602 (Tri.-Chennai)
(iii) Mohit Overseas vs. Commissioner of Customs: 2016 (335) ELT 18 (Del.)
(iv) UFLEX Ltd. vs. Commissioner of Customs, New Delhi: 2013 (298) ELT 476 (Tri.-Del.)
(v) Oswal Agloimpex Pvt. Ltd. vs. Commissioner of Customs, Kandla: 2012 (283) ELT 300 (Tri.-Ahmd.)
(vi) Commissioner of Central Excise, Nhava Sheva vs. Crest Chemicals: 2009 (244) ELT 361 (Tri.-Mum.)
(vii) Chirag Enterprises vs. Commissioner of Customs (EP), Mumbai: 2008 (232) ELT 730 (Tri.-Mumbai)
(viii) Senka Carbon Pvt. Ltd. vs. Commissioner of Customs, Chennai: 2007 (216) ELT 397 (Tri.-Chennai)
(ix) Union of India vs. Aluminium Industries Ltd.: 1996 (83) ELT 41 (Ker.)
3. The learned Authorised Representative on behalf of the Revenue reiterating the findings of the Commissioner (A) submits that since the goods were not examined at the time of import, the value was accepted by both the Department and the appellant, the question of reopening of the assessment does not arise. Moreover, the documents that were submitted before the Commissioner (A) were not available at the time of import but they happen to have revised the purchase order and revised invoice which was generated at a later period of time which cannot be accepted as a transaction value for the said goods. Therefore, he submits that the goods that were not examined at the time of import cannot now be examined and hence, the question of revising the value based on the documents that were not available at the time of import cannot allow either to amend the Bill of Entry or reassessment.
4. We have gone through the records of case carefully and find that the facts that are undisputed:
a) Bill of Entry No. 276457 dated 27.11.2009 filed where goods were declared as SPO for 5691 XXX CATIA Hybrid Design.
b) The goods imported by the appellant were not examined at the time of import as they were an ACP client. (Examination order placed below)
c) Invoice No. CUM9711A dated 26.11.2009 declared the value as USD 21,49,953.61
d) TR6 Challan No.98122006 dated 27.11.2009 evidencing payment of duty of Rs.84,64,975/-.
e) Amended Purchase Order No. G08659A dated 10.12.2009.
The goods were assessed and payment of duty was made and the goods were cleared for home consumption. Now, after clearance of the goods, the appellant claims that they paid excess duty not because there was an error either in the Bill of Entry or in the invoice but based on a revised purchase order and revised invoice generated at a later dated by the supplier on the request of the appellant. These documents were not in existent at the time of import and the claim of the appellant based on the quotation has no value in as much as a quotation is not a price which has been agreed upon. The purchase order and the commercial invoice for that purchase order are the legal documents in a commercial transaction. Moreover, the goods were not examined at the time of import nor were made available to be examined at the time of their request to amend the value.
Section 154. Correction of clerical errors, etc. –
Clerical or arithmetical mistakes in any decision or order passed by the Central Government, the Board or any officer of customs under this Act, or errors arising therein from any accidental slip or omission may, at any time, be corrected by the Central Government, the Board or such officer of customs or the successor in office of such officer, as the case may be.
In this case, Section 154 is not applicable in as much as there is no clerical mistake committed in any of the invoices.
Section 149. Amendment of documents. – Save as otherwise provided in Sections 30 and 41, the proper officer may, in his discretion, authorise any document, after it has been presented in the custom house to be amended 1 [in such form and manner, within such time, subject to such restrictions and conditions, as may be prescribed]:
Provided that no amendment of a bill of entry or a shipping bill or bill of export shall be so authorised to be amended after the imported goods have been cleared for home consumption or deposited in a warehouse, or the export goods have been exported, except on the basis of documentary evidence which was in existence at the time the goods were cleared, deposited or exported, as the case may be.
(Emphasis supplied)
From the above provisions, it is abundantly clear that for invoking Section 149, relevant documents should have been in existence at the time of import but in this case, obviously the invoice was revised based on the request of the appellant and the veracity of the genuineness of this invoice could not be verified since the goods were not examined at the time of import nor were available for examination.
5. We find that the Hon’ble High Court of Delhi in the case of Terra Films Pvt. Ltd. vs. Commissioner of Customs: 2011 (268) E.L.T. 443 (Del.) held that:
“The facts leading to the filing of the present appeal need to be mentioned in brief. The appellant is a manufacturer of c-extruded multilayer film having their factory in specified area of Himachal Pradesh and availing exemption from customs duty. It exported commodities under 7 shipping bills during the period of September 2004 to April 2005. In the shipping bills, they had mentioned about the scheme under which exports were made as “DEPB/DEEC”. The goods stood exported to the destination under this scheme. After a lapse of considerable period, the exporter/appellant vide its letter dated 27th January, 2006 followed by some more letters requested for permission to amend their DEEC/DEPB shipping bills into those DEEC/DEPB cum drawback scheme.
6. As per proviso of this Section 149, no amendment of a shipping bill was to be allowed after the export goods have been exported except on the basis of the documentary evidence, which was in existence at the time the goods were exported. The submission of the learned counsel for the appellant/exporter in this regard was that the exporter was in possession of all the documents at the time of export to show that it was entitled to claim under the DEPB/DECC cum drawback scheme. From the plain reading of Section 149, it may be seen that exporter could not claim amendment in routine and as a matter of right. The discretion vested in the Proper Officer to permit amendment in any document after the same has been presented in the Customs house. Though this discretion was to be exercised judiciously, but it was qualified with the proviso that the amendment could be allowed only if it was based on the documentary evidence in existence at the time the goods were exported. The Commissioner in the remand case has rightly observed that the present case in fact relates to the request for conversion of shipping bills from one export promotion scheme into another and was not merely of an amendment in the shipping bill. The request was made for conversion from one scheme to another after the lapse of long period of more than one year. It was a case of request for “conversion” and not of “amendment” inasmuch by converting from one scheme to another, it was not only addition of word ‘cum’ duty drawback, but change of entire status and character of the documents. Even if it was to be taken as a case of amendment, the proper officer may not be in possession of the documents sought to be amended after lapse of such a long period, particularly when the goods already stood exported. For enabling an exporter to draw the benefits of any scheme, not only physical verification of documents would be required, but as is noted by both the authorities below, the verification of the goods of export as also their examination by the Customs was necessarily required to be done. In the given factual circumstances, that was rightly held to be impossible. The Commissioner in the remand case rightly distinguished the cases cited on behalf of the exporter from the facts of the present. The finding of fact as arrived at by the Commissioner has been rightly upheld by the CESTAT.
7. We do not see any perversity or illegality in the discretion exercised by the Commissioner in rejecting the request of the exporter of conversion/amendment from one scheme to the other after a lapse of more than one year. There is no reason to interfere in the findings of the fact arrived at by the CESTAT. Since, there is no question of law involved, the appeal is dismissed. No orders as to costs. Ordered accordingly.”
(Emphasis supplied)
6. The Hon’ble High Court of Madras in the case of Commr. of Cus. (Seaport-Export), Chennai Vs. Suzlon Energy Ltd. 2013 (293) E.L.T. 3 (Mad.) held that:
“18. A similar issue was considered by the Division Bench of Delhi High Court in the matter of M/s. Terra Films Pvt. Ltd. v. Commissioner of Customs [2011 (268) E.L.T. 443 (Del.)]. In the above decision, the Delhi High Court has considered the scope of Section 149 of Customs Act and found that the discretion vested in the Proper Officer to permit amendment in any document after the same has been presented in the Customs house has to be though exercised judicially, it was qualified with the proviso that the amendment could be allowed only if it was based on the documentary evidence in existence at the time the goods were exported. It is further observed therein that the request was made for conversion from one Scheme to another is a case of request for conversion and not of an amendment inasmuch as by converting from one Scheme to another, it was not only addition of certain word, but change of entire status and character of the documents. Thus, the Delhi High Court observed that the Proper Officer may not be in a possession of the documents sought to be amended particularly, when the goods already stood exported. For enabling an exporter to draw the benefits of any scheme, not only physical verification of documents would be required, but also verification of the goods of export and their examination by the Customs was necessarily required to be done. By observing so, the Delhi High Court upheld the rejection of the request of the exporter seeking for conversion of the Shipping Bill from one Scheme to another.
19. We are in full agreement with the reasonings given by the Delhi High Court in the above said case and by following the said decision [2011 (268) E.L.T. 443 (Del.)], we find that the 1st Respondent’s claim seeking conversion is not maintainable and the same has been rightly rejected by the Commissioner of Customs. The Tribunal has not gone into any of these aspect in detail, even though it happens to be a final fact finding authority. It has simply allowed the conversion by resorting to the provision under Section 149 of Customs Act as if, it is a simple request for amendment. Therefore, we find that the order passed by the Tribunal cannot be sustained and accordingly, the same is set aside and the appeal filed by the Department is allowed. The questions of law raised in the appeal are answered in favour of the Department. No costs.
(Emphasis supplied)
7. The High Court of Gujarat in the case of Anil Sharma Versus Union of India 2017 (350) E.L.T. 332 (Guj.) held that:
“6. Heard the learned advocates for the respective parties at length. At the outset, it is required to be noted that it is the case of the petitioner that though they imported the goods under the shipping bill under the Advance Authorization Scheme, through oversight and by mistake it was punched as duty drawback. Therefore, it is the case on behalf of the petitioner that subsequently when they requested to amend the bill of entry, the case would fall under Section 149 of the Customs Act, which does not provide any limitation to make application to amend the shipping bill and therefore, the authorities are not justified in rejecting the application on the ground that the same is not within the period of three months, relying upon Board Circular No. 36 of 2010.. Identical question came to be considered by the Division Bench of the Madras High Court in the case of Suzlon Energy Ltd. (supra). Relying upon considering the decision of the Division Bench of the Delhi High Court in the case of Terra Films Pvt. Ltd. (supra), Madras High Court has held that such goods would not fall under Section 149 of the Customs Act, but shall be governed by Board Circular No. 36 of 2010. In the case of Terra Films Pvt. Ltd. (supra), the Delhi High Court has considered the scope of Section 149 of the Customs Act and found that discretion vested in the proper officer to permit the amendment in any document after same has been presented in the Custom House has to be though exercised judiciously but it was qualified with the proviso that the amendment could be allowed only if it was based on the documentary evidence in existence at the time the goods were exported. In the said decision, it is further observed that the request made for conversion from one scheme to another scheme is a case of request for conversion and not of amendment inasmuch as by converting from one scheme to another scheme, it was not only addition of word “cum” duty drawback but change entire status and character of the document. The Delhi High Court has thereafter observed that proper officer may not be in possession of the documents sought to be amended after lapse of such a long period when the goods already stood exported. For enabling an exporter to draw the benefits of any scheme, not only physical verification of the documents would be required but also verification of the goods of export as also their examination by the Customs was necessarily required to be done.
6.1 Thus, the request of the petitioner which has been rejected by the respondent cannot be said to be a mere amendment in the shipping bill as contemplated under Section 149 of the Customs Act, but it will be case of conversion of one scheme to another scheme, for which, proper officer is required to verify whether the very manufactured final product which has been manufactured from the raw material has been exported or not.
7. The contention on behalf of the petitioner that as the case would fall under Section 149 of the Customs Act which does not prescribe any time limit and therefore, on the basis of material on record, which was available at the time of export, it could have been verified whether final goods manufactured from the raw material imported has been exported or not, can be verified is concerned, as such, as observed herein above Section 149 of the Customs Act will not be applicable. Even otherwise, it is required to be noted that what is considered at the time of DEEC, the appropriate inquiry would be limited to the extent to satisfy the authority whether raw material which was imported has been used in manufacturing final product or not. So far as Advance Authorization Scheme is concerned, the appropriate authority is required to consider after holding appropriate inquiry that the raw material which was imported has only been used in the manufacture of final product and that final product has been actually exported.
Based on the above decisions of the Hon’ble High courts it is clearly evident for any amendment under section 149 the proviso needs to be strictly interpreted and any amendment cannot be claimed in a routine manner and as a matter of right. The discretion vested in the Proper Officer to permit amendment in any document after the same has been presented in the Customs house. Though this discretion was to be exercised judiciously, but it was qualified with the proviso that the amendment could be allowed only if it was based on the documentary evidence in existence at the time the goods were exported. It also held that for enabling the appellant the benefits of any amendment not only physical verification of the documents would be required but also verification of the goods and also their examination by the Customs was necessarily required to be done. Based on these observations the request for amendment was rejected.
Keeping the above observations of the judiciary let’s examine as to how they are relevant for the present case where the issue is in relation to the amendment of value of the imported goods. In the present case the documents produced for amendment of the value were never before the assessing authority at the time of clearance and they were admittedly revised purchase order and revised commercial invoice. Secondly since the appellant is an ACP client the goods were not examined at the time of import. Therefore, the criteria laid down as held by the above decisions evident that it is clear that for any amendment under section 149 the proviso needs to be strictly interpreted and any amendment cannot be claimed in a routine manner and as a matter of right and the discretion is vested in the Proper officer to permit amendment in any document and the discretion was to be exercised judiciously. The proviso to section 149 allowed the amendment only if it was based on the documentary evidence in existence at the time the goods were imported/exported and to enable any benefits of any amendment not only physical verification of the documents would be required but also verification of the goods necessarily required to be done. In the present case these conditions were not satisfied and hence rejected.
(Emphasis supplied)
8. The Supreme Court in the case of Escorts Limited Versus Union of India, 1998 (97) E.L.T. 211 (S.C.) observed that “it may be noticed that the Act does not prescribe any particular form in which the order of assessment is to be made. In the very nature of things, no formal order of assessment can be expected when there is no dispute as to the classification or the rate of duty, no formal order can be expected in such a case, it is more like `across-the-counter’ affair. ……….. The bill of entry presented by the appellant was signed, signifying approval by the assessing officer. That itself is an order of assessment in such a situation. We are, therefore, not prepared to agree that there is no order of assessment in this case, and therefore, the limitation prescribed in Section 27 did not begin to run. Section 27 is emphatic in language. It says that an application for refund of duty shall be made before the expiry of six months from the date on which the duty was paid. In the face of this provision, the authorities under the Act, including the Government of India, had no option but to dismiss the appellant’s application.”
9. The Hon’ble Supreme Court in the case of Eicher Tractors Ltd. versus Commissioner of Customs, Mumbai, 2000 (122) E.L.T. 321 (S.C.) dated on 14-11-2000 observed that:
“6. Under the Act customs duty is chargeable on goods. According to Section 14(1) of the Act, the assessment of duty is to be made on the Value of the goods. The value may be fixed by the Central Government under Section 14(2). Where the value is not so fixed the value has to be determined under Section 14(1). The value, according to Section 14(1), 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 – in the course of international trade. The word ‘ordinarily’ necessarily implies the exclusion of “extraordinary” or “special” circumstances. This is clarified by the last phrase in Section 14 which describes an “ordinary” sale as one “where the seller or the buyer have no interest in the business of each other and the price is the sole consideration for the sale ”. Subject to these three conditions laid down in Section 14(1) of time, place and absence of special circumstances, the price of imported goods is to be determined under Section 14(1A) in accordance with the rules framed in this behalf.
7. The rules which have been framed are the Customs, Valuation (Determination of Price of Imported Goods) Rules, 1988. Under Rule 3(i) “the value of imported goods shall be the transaction value”. “Transaction value”’ has been defined in Rule 2(f) as meaning the value determined in accordance with Rule 4. Rule 4(1) in turn states “The transaction value of imported goods shall be the price actually paid or payable for the goods when sold for export to India, adjusted in accordance with the provisions of Rule 9 of these rules.”
8. Reading Rule 3(i) and Rule 4(1) together, it is clear that a mandate has been cast on the authorities to accept the price actually paid or payable for the goods in respect of the goods under assessment as the transaction value. But the mandate is not invariable and is subject to certain exceptions specified in Rule 4(2) namely:
(a) there are no restrictions as to the disposition or use of the goods by the buyer other than restrictions which –
(i) are imposed or required by law or by the publicn authorities in India;
or
(ii) limit the geographical area in which the goods may be resold; or
(iii) do not substantially affect the value of the goods;
(b) the sale or price is not subject to same condition or consideration for which a value cannot be determined in respect of the goods being valued;
(c) no part of the proceeds of any subsequent resale, disposal or use of the goods by the buyer will accrue directly or indirectly to the seller, unless an appropriate adjustment can be made in accordance with the provisions of Rule 9 of these rules; and
(d) the buyer and seller are not related, or where the buyer and seller are related, that transaction value is acceptable for customs purposes under the provisions of sub-rule (3).”
9. These exceptions are in expansion and explicatory of the special circumstances in Section 14(1) quoted earlier. It follows that unless the price actually paid for the particular transaction falls within the exceptions, the Customs authorities are bound to assess the duty on the transaction value.
12. Rule 4(1) speaks of the transaction value. Utilisation of the definite article indicates that what should be accepted as the value for the purpose of assessment to customs duty is the price actually paid for the particular transaction, unless of course the price is unacceptable for the reasons set out in Rule 4(2). “Payable” in the context of the language of Rule 4(1) must, therefore, be read as referring to “the particular transaction” and payability in respect of the transaction envisages a situation where payment of price may be deferred.
If the phrase ‘the transaction value’ used in Rule 4 were not limited to the particular transaction then the other Rules which refer to other transactions and data would become redundant.
14. It is only when the transaction value under Rule 4 is rejected, then under Rule 3(ii) the value shall be determined by proceeding sequentially through Rules 5 to 8 of the Rules. Conversely if the transaction value can be determined under Rule 4(1) and does not fall under any of the exceptions in Rule 4(2), there is no question of determining the value under the subsequent Rules”.
(Emphasis supplied)
10. The Supreme Court in the case of India Century Metal Recycling Pvt. Ltd. vs. Union of India 2019 (367) E.L.T. 3 dated on 17-5-2019 held that:
“9. As per Section 14(1) of the Act, value of the imported goods shall be the transactional value of such goods, which means the price actually paid or payable for the goods when sold for export to India where the buyers and sellers are not related and the price fixed is the sole consideration for sale. As per the first proviso to Section 14(1) of the Act, the transactional value for the purpose of Customs duty would include amounts paid or payable as costs and services like commission, brokerage, engineering, design work, cost of transportation, etc., as may be specified in the rules made in this behalf. These amounts are to be added to the declared transactional value. Accordingly, in terms of Rule 10 of the 2007 Rules, the value and price of costs and services are added to the price actually paid or payable for the imported goods for determining the transaction value.
15. The requirements of Rule 12, therefore, can be summarised as under:
(a) The proper officer should have reasonable doubt as to the transactional value on account of truth or accuracy of the value declared in relation to the imported goods.
(b) Proper officer must ask the importer of such goods further information which may include documents or evidence;
(c) On receiving such information or in the absence of response from the importer, the proper officer has to apply his mind and decide whether or not reasonable doubt as to the truth or accuracy of the value so declared
(d) When the proper officer does not have reasonable doubt, the goods are cleared on the declared value.
(e) When the doubt persists, sub-rule (1) to Rule 3 is not applicable and transaction value is determined in terms of Rules 4 to 9 of the 2007 Rules.
(f) The proper officer can raise doubts as to the truth or accuracy of the declared value on ‘certain reasons’ which could include the grounds specified in clauses (a) to (f) in clause (iii) of the Explanation.
(g) The proper officer, on a request made by the importer, has to furnish and intimate to the importer in writing the grounds for doubting the truth or accuracy of the value declared in relation to the imported goods. Thus, the proper officer has to record reasons in writing which have to be communicated when requested.
(h) The importer has to be given opportunity of hearing before the proper officer finally decides the transactional value in terms of Rules 4 to 9 of the 2007 Rules.
11. In view of the above observations of the apex court, the changes to be brought about in valuation of goods is not just a simplicitor amendment, Section 14 of the Customs Act along with the Customs Valuation Rules clearly laid down the procedure for any assessment under this Specialized Act. Once an assessment is done, only on appeal, reassessment is possible and any demand/refund on account of reassessment on account of valuation or for any other reason has to be within the framework of laws as laid down under Section 28/27 of the Customs Act, 1962. Therefore Section 149 amendments cannot be read in isolation making these sections with regard to classification or valuation redundant. Reassessment of any assessment cannot be equated with an amendment under Section 149. The legislature, in the interest of justice, has not laid down any time limit under Section 149, does not take away the fact that any changes in valuation should not be in tandem with the laws laid down for refund or demand or else there will be no end for amendments which will result in utter chaos and de-stabilize the entire gamut of the Customs Act, 1962.
12. In the present case, first of all, no documents existed at the time of assessment and the documents produced for amendment were not available at the time of assessment, these surfaced at much later date. The goods were not examined and the invoice produced by the appellant at the time of import had no factual errors and therefore to change the value of the imported goods based on an amended purchase order and revised invoice will not be a simplicitor amendment envisaged under Section 149. Moreover, the Commissioner (A) has clearly observed that there is no evidence to indicate that this revised purchase order and the revised invoice related to the transaction already completed. He also notes that “the amended purchase order dated 10.12.2009, inter alia continue to indicate the date required delivery as 10.12.2009, payment to be made within 30 days documents to be sent as soon as shipment is sent etc;” which clearly shows that the revised documents cannot be related to the imported goods which have already been cleared for home consumption. Further, it is also observed that the supplier had indicated that on 11.01.2010 credit note would be issued for the differential amount and no evidence is produced till date. There are no evidences produced till date with regard to the revised transactions as to how the differential amounts reflect in the books of accounts of the supplier as well as the appellant. In view of the above, the question of considering change in value as mere amendment as per Section 14 read with Section 149 is ruled out. Therefore, the Commissioner (A) was right in rejecting these changes and in disallowing reassessment of the imported goods.
13. In view of our observations above, the appeal is rejected.
(Order pronounced in open court 08/09/2023.)
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