Case Law Details
Commissioner of Customs Vs Namo Alloys Pvt. Ltd. (CESTAT Chandigarh)
CESTAT Chandigarh held that once the importer voluntary accepted the enhancement then the importer is estopped from challenging the same subsequently.
Facts- The respondent imported Aluminium Scrap by filing 35 bills of entries at ICD Palwal and self-assessed the duty. The Bills of entries were assessed by the Deputy/Assistant Commissioner of Customs, ICD Palwal at higher value than the declared value which was voluntarily accepted by the respondent and did not ask for any speaking order and paid enhanced duty voluntarily without any protest. However, later on, the importer challenged the value assessment and filed appeals before the Commissioner of Customs (Appeals), New Delhi who vide the impugned order set aside the re-assessment of goods at enhanced value and restored the self-assessment at the declared value and allowed the appeals filed by the importer.
Conclusion- Held that Tribunal in the case of Commissioner of Customs (Import), ICD, TKD, New Delhi vs. M/s Sodagar Knitwear Pvt. Ltd. cited has held that once the importer voluntary accepted the enhancement then he is precluded from challenging the same. This judgement of the Tribunal has been upheld by the Hon’ble Apex Court.
FULL TEXT OF THE CESTAT CHANDIGARH ORDER
These 35 Appeals have been filed by the Revenue against the common impugned order dated 19.03.2020 passed by the Commissioner of Customs, New Delhi whereby the Commissioner (Appeals) has allowed the appeals of the respondent and directed the lower authorities to re-assess the duties at declared value.
2. Briefly the facts of the present case are that the respondent imported Aluminium Scrap by filing 35 bills of entries at ICD Palwal and self-assessed the duty. The Bills of entries were assessed by the Deputy/Assistant Commissioner of Customs, ICD Palwal at higher value than the declared value which was voluntarily accepted by the respondent and did not ask for any speaking order and paid enhanced duty voluntarily without any protest. However, later on, the importer challenged the value assessment and filed appeals before the Commissioner of Customs (Appeals), New Delhi who vide the impugned order set aside the re-assessment of goods at enhanced value and restored the self-assessment at the declared value and allowed the appeals filed by the importer.
3. Heard the parties and perused the case records.
4. Ld. DRs appearing for the Revenue submitted that the impugned order is not sustainable in law as the same has been passed without properly appreciating the facts and evidence on record and without considering the law laid down by the Tribunal on identical issues. He further submitted that the Ld. Commissioner (Appeals) did not appreciate that the importer in this case after seeing the contemporaneous import data (prevailing during that period) has agreed to redetermination of value in their reply to query in EDI system and voluntarily forfeited their right of show cause notice and opportunity of personal hearing. He further submits that as per his acceptance, the value was enhanced by the department and duty was discharged by the importer without showing any protest up to the date of Out of Charge. He also submits that nobody can stop the importer of its right to protest even if the clearance was being taken to save the demurrage charges, which the importer did not avail in the present case. The protest, wherever shown by the Importer at appeal stage is post clearance from which it cannot be concluded that the payment of duty by the importer was under protest. He also submits that the protest if any at the appellate stage cannot be considered because the duty was not paid under protest.
5. He further submits that the Ld. Commissioner (Appeals) has failed to appreciate that in several decisions where the courts and Tribunals have held that a written admission before an Assessing Officer of Customs is an admissible evidence and in the present case also, the importer has voluntarily accepted the value loading and has requested that he doesn’t require show cause notice and Personal hearing in the said letter which is available on record of the appeal paper book.
6. Ld. DR further submits that an identical issue has been considered by the Division Bench of this Tribunal in the case of Commissioner of Customs, Delhi vs. M/s Hanuman Prasad & Sons reported in 2020 (12) TMI 1092-CESTAT NEW DELHI wherein also the Commissioner has allowed the appeal of the importer and set-aside the enhancement but the Tribunal after considering all the provisions of Customs Act, 1962 relating to valuation and Valuation Rules, 2007 and the voluntary acceptance of the enhanced value by the importer, allowed the appeals of the department.
7. Ld. DR took us through the findings of the Division Bench in the case of M/s Hanuman Prasad & Sons cited (supra). He submits that subsequent to the passing of the judgement in the case of M/s Hanuman Prasad & Sons cited (supra), another Division Bench of the Principal Bench, New Delhi of the Tribunal in the case of M/s Sumridhi Aluminium (P) Ltd. vs. Commissioner of Customs, New Delhi vide Final Order No. 51191-51282 of 2023 dated 13.09.2023 again examined all the rules relating to valuation and by relying upon the decision in the case of M/s Hanuman Prasad & Sons cited (supra) and other decisions dismissed the appeals of the importer.
8. Ld. DR also relied upon the following decisions in support of his submissions that once the importer has voluntarily accepted the enhanced value then the department is not required to pass a speaking order as provided in Section 17 sub-section 5 of the Customs Act, 1962.
- Jai Shiv Trading Company Vs. Commissioner of Central Excise, New Delhi 2018 (359) ELT 208(Tri-Delhi)
- Aestrik Techno-Signs Vs. Commissioner of Customs, NCH, New Delhi. Final Order No. 1146/2021.
- M/s Sukhdev Exports Overseas Vs Commissioner of Customs (Export), Patparganj, New Delhi (2023 (4) ΤΜΙ 17-CESTAT NEW DELHI)
- ICD Patparganj & Other ICDs Vs. Manvi Exim Pvt. Ltd. vide Final Order No. 50552-50559/2022 dated 04.07.2022
- Surieet Singh Chabbra VIs UOI (reported as 1997 (89) ELT 646 (SC)
- Commissioner of Central Excise, Madras Vs Systems and Components Private Limited reported in 2004 (165) ELT 136 (SC)
- Commissioner of Customs(Import), ICD-TKD., New Delhi Vs. M/s. Sodagar Knitwear Pvt. Ltd. [2018(362)ELT819(Tri-Del)]
9. On the other hand, the Ld. Counsel for the respondent has vehemently supported the impugned order passed by the Commissioner (Appeals) of Customs, New Delhi. He further submits that the Commissioner (Appeals) has allowed the appeal of the importer mainly on the following grounds:-
a) That there is no evidence that the overseas supplier and the appellant are related and price is not sole consideration placing reliance on the decision of the Apex court in the case of South India Television (P) Ltd., (2007(214)ELT3(SC)].
b) That they have imported scrap of various grades and the price of each grade depends on negotiations between the buyer and seller and the price fixed on the basis of market conditions, demand and supply, content of Aluminium and the expected recovery of Aluminium from such scrap; that every document was before the assessing officer but he enhanced the value without any basis.
c) That as held in the case of Sanjivini Non-Ferrous Trading Pvt Ltd. 2017 (7)GSTL 82 (Tri.All.)I, assessable value have to be arrived at on the basis of price which is actually paid and in a case where price is not the actual consideration, or if the buyer and seller are related persons, then after establishing price is not the sole consideration, the transaction value can be rejected and taking evidences into consideration, assessable value can be arrived at; that in the instant case such exercise has not been done.
d) That the assessing officer has not doubted their documents like invoice, Bill of lading etc. The declared value can be rejected only in terms of Rule 12 of CVR 2007 as per Hon’ble Supreme Court Judgement in case of Century Metals (2019(367)ELT 3(SC)].”
10. Ld. Counsel further submits that the department did not follow the procedure contemplated under Rule 12 of the valuation rules to reject the transaction value declared by the importer. He also submits that NIDB data cannot be the sole basis to reject the transaction value without any cogent reasons. He also submits that the burden of proof lies upon the department to prove the charge of under valuation, which burden has not been discharged in the present case.
11. After considering the submissions of both the parties and perusal of material on record, we find that on identical facts, this Tribunal in the case of M/s Hanuman Prasad & Sons cited (supra) has examined the provisions relating to valuation as prescribed in the Customs Act, 1962 and the Customs Valuation Rules, 2007 and after examining the same, the Tribunal has come to the conclusion that when the importer has voluntarily accepted the enhanced value without any protest then in that case it is not incumbent upon the department to pass a speaking order. Here, it is pertinent to reproduce the relevant findings of the coordinate bench in the case of M/s Hanuman Prasad & Sons cited (supra) which is reproduced herein below:-
“21 The Commissioner (Appeals), despite a categorical statement made by the importers that they did not desire a speaking order to be passed, observed “an obligation was cast on the assessing authority to pass a speaking order disclosing the grounds for rejecting the declared value and only then the assessing officer could have enhanced the value.” This finding of the Commissioner (Appeals) is perverse as it is clearly contrary to the specific statement made by the importers in the letters submitted by them to the assessing officer. What has also to be kept in mind is that section 17(5) permits the importer to waive this right.
22. It is seen from a perusal of section 17(4) of the Customs Act that the proper officer can re-assess the duty leviable, if it is found on verification, examination or testing of the goods or otherwise that the self-assessment was not done correctly. Sub- section (5) of section 17 provides that where any re-assessment done under sub-section (4) is contrary to the self-assessment done by the importer, the proper officer shall pass a speaking order on the re-assessment, except in a case where the importer confirms his acceptance of the said re-assessment in writing.
23. In the present case, as noticed above, the proper officer doubted the truth or accuracy of the value declared by the importer for the reason that contemporaneous data had a significantly higher value. It was open to the importers to require the proper officer to intimate the grounds in writing for doubting the truth or accuracy of the value declared by them and seek a reasonable opportunity of being heard, but they did not do so. On the other hand, the importers submitted in writing that though they had declared the value of the imported goods at 1.20 USD per kg., but on being shown contemporaneous data, they have agreed that the value of the goods should be enhanced to 1.80 USD per kg for Hanuman Prasad and to 1.94 USD per kg. for Niraj Silk. The importers also specifically stated that they did not want to avail of the right conferred on them under section 124 of the Customs Act and, therefore, they did not want any show cause notice to be issued to them or personal hearing to be provided to them. The importers also specifically stated that they did not want a speaking order to be passed on the Bills of Entry. It needs to be noted that section 124 of the Customs Act provides for issuance of a show cause notice and personal hearing, and section 17(5) of the Customs Act requires a speaking order to be passed on the Bills of Entry, except in a case where the importer/exporter confirms the acceptance in writing.
24. It is no doubt true that the value of the imported goods shall be the transaction value of such goods when the buyer and the seller of goods are not related and the price is the sole consideration, but this is subject to such conditions as may be specified in the rules to be made in this behalf. The Valuation Rules have been framed. A perusal of rule 12(1) indicates that when the proper officer has reason to doubt the truth or accuracy of the value of the imported goods, he may ask the importer to furnish further information. Rule 12(2) stipulates that it is only if an importer makes a request that the proper officer shall, before taking a final decision, intimate the importer in writing the grounds for doubting the truth or accuracy of the value declared and provide a reasonable opportunity of being heard. To remove all doubts, Explanation 1(iii)(a) provides that the proper officer can have doubts regarding the truth or accuracy of the declared value if the goods of a comparable nature were assessed at a significantly higher value at about the same time.
25. Explanation (1)(i) to rule 12 of the Valuation Rules, however, provides that the rule only provides a mechanism and procedure for rejection of declared value and does not provide a method for determination of value and if the declared value is rejected, the value has to be determined by proceeding sequentially in accordance with rules 4 to 9.
26. In Century Metal Recycling, the Supreme Court summarized the provisions of rule 12 of the Valuation Rules and the observations are as follows :
“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 persists.
(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.
16. Proper officer can therefore reject the declared transactional value based on certain reasons to doubt the truth or accuracy of the declared value in which event the proper officer is entitled to make assessment as per Rules 4 to 9 of the 2007 Rules. What is meant by the expression grounds for doubting the truth or accuracy of the value declared has been explained and elucidated in clause (iii) of Explanation appended to Rule 12 which sets out some of the conditions when the reason to doubt exists. The instances mentioned in clauses (a) to (f) are not exhaustive but are inclusive for there could be other instances when the proper officer could reasonably doubt the accuracy or truth of the value declared.”
27. It is non-consideration of the factual position emerging from the statements made by Hanuman Prasad and Niraj Silk that led the Commissioner (Appeals) to believe that the declared value could be rejected only on the basis of reasonable and cogent evidence, which burden the Revenue failed to discharge as it could not prove that the invoice did not represent the true transaction value in the international market.
28. Despite the specific requests made by the importers in the letters submitted by them, it was sought to be contended by the importers in the Appeals filed by them before the Commissioner (Appeals) that the transaction value of the imported goods alone should have been treated to be the value of the goods, as provided for under rule 3(1) of the Valuation Rules, since none of the conditions stipulated in the proviso to sub-rule (2) of rule 3 were attracted and in any case, if the declared value could not be determined under sub-rule (1) of rule 3, it was required to be determined by proceeding sequentially through rules 4 to 9.
29. Rule 3 of the Valuation Rules is, therefore, reproduced below:
“Rule 3. Determination of the method of valuation.-
(1) Subject to rule 12, the value of imported goods shall be the transaction value adjusted in accordance with provisions of rule 10;
(2) Value of imported goods under sub-rule (1) shall be accepted:
Provided that –
(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 public 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 some 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 10 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) below:
(3) xxxxxxxx xxxxxxxxx xxxxxxxxx
(4) If the value cannot be determined under the provisions of sub-rule (1), the value shall be determined by proceeding sequentially through rule 4 to 9.”
30. The very fact that the importers had agreed for enhancement of the declared value in the letters submitted by them to the assessing authority, itself implies that the importers had not accepted the value declared by them in the Bills of Entry. The value declared in the Bills of Entry, therefore, automatically stood rejected. Further, once the importers had accepted the enhanced value, it was really not necessary for the assessing authority to undertake the exercise of determining the value of the declared goods under the provisions of rules 4 to 9 of the Valuation Rules. This is for the reason that it is only when the value of the imported goods cannot be determined under rule 3(1) for the reason that the declared value has been rejected under sub rule 2, that the value of the imported goods is required to be determined by proceeding sequentially through rule 4 to 9. As noticed above, the importers had accepted the enhanced value and there was, therefore, no necessity for the assessing officer to determine the value in the manner provided for in rules 4 to 9 of the Valuation Rules sequentially.
31. In this connection, it would be useful to refer to a decision of this Tribunal in Advanced Scan Support Technologies vs Commissioner of Customs, Jodhpur 2015 (326) ELT 185 (Tri.Del.), wherein the Tribunal, after making reference to the decisions of the Tribunal in Vikas Spinners vs Commissioner of Customs, Lucknow 2001 (128) ELT 143 (Tri.-Del.) and Guardian Plasticote Ltd. v. CC (Port), Kolkotta 2008 (223) ELT 605 (Tri. Kol.), held that as the Appellant therein had expressly given consent to the value proposed by the Revenue and stated that it did not want any show cause notice or personal hearing, it was not necessary for the Revenue to establish the valuation any further as the consented value became the declared transaction value requiring no further investigation or justification. Paragraph 5 of the decision is reproduced below:
“5. We have considered the contentions of both sides. We find that whatever may be the reasons, the appellant expressly gave its consent to the value proposed by Revenue and expressly stated that it did not want any Show Cause Notice or personal hearing. Even the duty was paid without protest. By consenting to enhancement of value and thereby voluntarily foregoing the need for a Show Cause Notice, the appellant made it unnecessary for Revenue to establish the valuation any further as the consented value in effect becomes the declared transaction value requiring no further investigation or justification. To allow the appellant to contest the consented value now is to put Revenue in an impossible situation as the goods are no longer available for inspection and Revenue rightly did not proceed to further collect and compile all the evidences/basis into a Show Cause Notice as doing so, in spite of the appellant having consented to the enhancement of value and requested for no Show Cause Notice, could/would have invited allegation of harassment and delay in clearance of goods. When Show Cause Notice is expressly foregone and the valuation is consented, the violation of principles of natural justice cannot be alleged. In the present case, while value can be challenged but such a challenge would be of no avail as with the goods not being available and valuation earlier having been consented, the onus will be on the appellant to establish that the valuation as per his consent suffered from fatal infirmity and such onus has not been discharged. Further, valuation of such goods requires their physical inspection and so re- assessment of value in the absence of goods will not be possible. The case of Eicher Tractors v. Union of India (supra) cited by the appellant is not relevant here as in that case there was no evidence that the assessee had consented to enhancement of value.”
[emphasis supplied]
32. In Vikas Spinners, the Tribunal dealing with a similar situation, observed as under :
“7. In our view in the present appeal, the question of loading of the value of the goods cannot at all be legally agitated by the appellants. Admittedly, the price of the imported goods declared by them was US $ 0.40 per Kg. but the same was not accepted and loaded to US $ 0.50 per Kg. This loading in the value was done in consultation with Shri Gautam Sinha, the Representative and Special Attorney of the appellants who even signed an affirmation accepting the loaded value of the goods on the back of the Bill of Entry dated 7-5-1999. After loading of the value, the appellants produced the special import licence and paid the duty on the goods accordingly of Rs. 4,22,008/- on 19-5-1990. Having once accepted the loaded value of the goods and paid duty accordingly thereon without any protest or objection they are legally estopped from taking somersault and to deny the correctness of the same. There is nothing on record to suggest that the loaded value was accepted by them only for the purpose of clearance of the goods and that they reserved their right to challenge the same subsequently. They settled their duty liability once for all and paid the duty amount on the loaded value of the goods. The ratio of the law laid down by the Apex Court in Sounds N. Images, (supra) is not at all attracted to the case of the appellants. The benefit of this ratio could be taken by them only if they had contested the loaded value at the time when it was done, but not now after having voluntarily accepted the correctness of loaded value of the goods as determined in the presence of their Representative/Special Attorney and paid the duty thereon accordingly.”
[emphasis supplied]
33. In Guardian Plasticote Ltd., the Tribunal after placing reliance on the decision of the Tribunal in Vikas Spinners, had also observed as follows :
“4. The learned Advocate also cites the decision of the Tribunal in the case of M/s. Vikas Spinners v. C.C., Lucknow – 2001 (128) E.L.T. 143 (Tri.-Del.) in support of his arguments. We find that the said decision clearly holds that enhanced value once settled and duty having been paid accordingly without protest, importer is estopped from challenging the same subsequently. It also holds that enhanced value uncontested and voluntarily accepted, and accordingly payment of duty made discharges the burden of the department to establish declared value to be incorrect. In view of the fact that the Appellants in this case have not established that they had lodged any protest and on the contrary their letter dated 21-4-1999 clearly points to acceptance of the enhanced value by them, the cited decision advances the cause of the department rather than that of the Appellants contrary to the claim by the learned Counsel.”
[emphasis supplied]
34. In BNK Intrade (P) Ltd. vs Commissioner of Customs, Chennai20, the Tribunal observed as follows :
“2………… It is also to be noted that the importer had also agreed for enhancement of the price based on contemporaneous prices available with the Department. We, therefore, find no merit in the contention raised in the appeal challenging the valuation and seeking the refund of the differential duty paid by the appellants on enhancement.”
35. The following position emerges from the aforesaid decisions of the Tribunal:
(i) When an importer consents to the enhancement of value, it becomes unnecessary for the revenue to establish the valuation as the consented value, in effect, becomes the declared transaction value requiring no further investigation;
(ii) When an importer accepts the loaded value of the goods without any protest or objection, the importer cannot be permitted to deny its correctness; and
(iii) The burden of the Department to establish the declared value to be in correct is discharged if the enhanced value is voluntarily accepted.
36. Learned Counsel appearing for the Respondent has, however, placed reliance upon certain decisions passed by the Tribunal to contend that the transaction value has to be first rejected and thereafter the assessing officer can re-assess with reasons and in accordance with the provisions of the Valuation Rules.
37. The first decision is Maruti Fabric Impex, a matter concerning the present appellant. The Tribunal observed:
“2. As per facts on record, the respondents imported fabrics and filed bills of entries declaring the transaction value as the assessable value in terms of the provisions of Section 14 of Customs Act. The bills of entries were assessed by the proper officer by enhancing the declared assessable value. The respondents cleared the goods on payment of duty on the enhancement.
3. The Appellate Authority took into consideration various facts including the issue as to whether an assessee can file an appeal against assessment made in the bills of entries, once he pays duty on the same and clears the goods, observed that acceptance of enhanced value proposed by the Department by an assessee does not preclude him from challenging the enhancement by way of appeal.
As regards enhancement of assessable value, he observed that no reasons stand given by the Revenue for such an enhancement. There is no rejection of the transaction value and in such a scenario, the transaction value has to be adopted as the assessable value. He also observed that though no reasons stand reflected in the Revenue’s assessment but the same seems to have been done on the basis of a DRI Alert dated 9-5-2011.
xxxxx xxxxx xxxxx
6. As regards the second issue, we find that Commissioner (Appeals) has gone into detailed examination of the provisions of Section 14 as also the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. As rightly observed by him, for adopting the provision of Customs Valuation Rule, the transaction value is required to be rejected as incorrect value. There being no evidence to show that the importer has paid over and above than the transaction value, to the seller of the goods, there is virtually no reasons to reject the transaction value. It is also a settled law that DRI Alerts cannot be adopted as a reason for enhancing the value. As such, we find no infirmity in the views adopted by Commissioner (Appeals) so as to interfere in the impugned order. Accordingly, the appeals filed by the Revenue are rejected.”
[emphasis supplied]
38. The Tribunal noticed that with regard to the enhancement of the assessable value, the Appellate Authority had observed that no reasons had been recorded by the assessing officer for such enhancement and there was no rejection of the transaction value. It needs to be noted that there is nothing in the decision which may indicate that the importer had himself accepted the transaction value indicated by the proper officer in writing or that he had forgone his right to a speaking order.
39. This decision of the Tribunal in Maruti Fabric Impex was followed in Hanuman Prasad.
40. The next decision relied upon by learned Counsel for the Respondent is Artex Textile Private Limited. The Tribunal observed that:
“2. The brief facts are that the respondent importer of polyester knitted fabrics were filing Bill of Entry from time to time at ICD Sonepat on the basis of self assessment of duty on the declared transaction value. The Bills of Entry were assessed by Assistant/Deputy Commissioner of Customs, by enhancing the value over and above the declared value. However, no speaking order was passed giving reasons for rejection of the declared value and enhancement thereof.
xxxxx xxxxx xxxxx
7. Having considered the rival contentions, we find that assessing officer have been making enhancement in a routine manner and the respondent who are regular importers are left with no choice but to sign on the dotted line for taking delivery of their goods to carry on their business, and also save the demurrage charges if the consignment is delayed in the port for want of clearance. Relying on the precedent Final Order No. 63455- 63456/2018 dated 25.10.2018 of this Tribunal and also in view of the Orderin-Appeal No. CC(A)/CUS/D- I I/ICD/788-1083/2014 dated 31.12.2014 had been accepted in respondent own case, we uphold the impugned common order(s) in appeal. Accordingly, these appeals by Revenue are dismissed being without merit. The stay applications also stand disposed of accordingly.”
41. A perusal of the aforesaid decision also does not indicate that the importer had accepted the declared value in writing or that the importer had waived his right to a speaking order. In fact, only a general statement has been made that the assessing officer have been making enhancement in a routine manner and that an importer has no choice but to sign in order to save demurrage charges.
42. It has to be noted that the two importers, Hanuman Prasad and Niraj Silk, had not made any statement that they have accepted the value of the goods proposed by the Revenue to save demurrage charges nor did they state in the letter that the value was being accepted by them under protest and they would agitate the matter in appeal. It is only in this appeal that it has been suggested that the value was accepted to save demurrage charges, perhaps prompted by the observations made by the Tribunal in Artex Textile Private Limited.
43. Learned Counsel for the Respondent also relied upon the decision of the Tribunal in Commissioner of Customs, New Delhi (ICD TKD) vs M/s Uniexcel Polychem Pvt. Ltd21. The Tribunal observed that :
“4. On the merit of enhancement of value, we are in agreement with the findings in the impugned order. No detailed reason has been given by the Original Authority for rejection of the transaction value. Apparently he was guided only by DRI alert which formed basis of enhancement of value. It has been repeatedly held by this Tribunal as well as Hon’ble High Courts that the transaction value cannot be rejected mechanically based on suspicion or general alert without supporting evidence to the effect that the invoice value does not reflect the transaction value required for assessment. In the present case, we find that no evidence of any nature has been brought out or discussed before such enhancement. Even contemporaneous value of similar or identical goods have not been examined and discussed.”
44. This decision also does not indicate that the importers had accepted the value of the goods proposed by the Revenue in writing or that the importers had waived their right to a speaking order. In fact, it was the DRI alert that formed the basis of enhancement of value.
45. The Supreme Court observed in Eicher Tractors Ltd., which decision has also been relied upon by the learned counsel for the Respondent, that it is only when the transaction value under rule 4 of the Valuation Rules is rejected that the transaction value is required to be determined by proceeding sequentially through rules 5 to 8. The decision of the Supreme Court in Century Metal Recycling also holds that if the declared transaction value is rejected, then it has to be determined in accordance with the procedure prescribed in rules 4 to 9. These decisions of the Supreme Court, for the reasons stated above, do not help the respondent.
46. Learned counsel for the respondent has also emphasized that NIDB data cannot be the sole basis to reject the transaction value without any cogent reasons. As seen above, the importers had in writing accepted the transaction value and it is perhaps for this reason that they did not require any show cause notice to be issued to them or a personal hearing to be granted to them. The respondent is, therefore, not justified in asserting that the transaction value has been determined on the basis NIDB data. It was their acceptance of the value that formed the basis for determination of the value. The decisions relied upon by the respondent to support the contention sought to be raised are, therefore, of no benefit to them.
47. The general observations made the Commissioner (Appeals) in the impugned order that the value declared in the Bills of Entry were being enhanced uniformly by the Department for a considerable period of time was uncalled for. The Commissioner (Appeals) completely failed to advert to the crucial aspect that the importers had themselves accepted the enhanced value. The Commissioner (Appeals) in fact, proceeded to examine the matter as if the assessing officer had enhanced the declared value on the basis of other factors and not on the acceptance by the importers. This casual observation is not based on the factual position that emerges from the records of the case.
48. Thus, for all the reasons above, the Commissioner (Appeals) was not justified in setting aside the orders passed by the assessing officer on the Bills of Entry.
49. When on merits it has been found that the Commissioner (Appeals) committed an error in allowing the appeals, it is not necessary to decide whether the appeals against the accepted transaction value were maintainable or not.
50. All the 36 orders passed by the Commissioner (Appeals) that have been impugned, therefore, deserve to be set aside and are, accordingly, set aside and the 36 Appeals filed by the Commissioner of Customs are allowed.”
12. Further, we find that this Tribunal in the case of Sumridhi Aluminium (P) Ltd. cited (supra) after relying upon the decision of the Tribunal in the case of M/s Hanuman Prasad & Sons cited (supra) and other decisions, dismissed the appeals of the importer.
13. We also find that in the case of Commissioner of Customs (Import), ICD, TKD, New Delhi vs. M/s Sodagar Knitwear Pvt. Ltd. cited (supra) where the Tribunal has held that once the importer voluntary accepted the enhancement then he is precluded from challenging the same. This judgement of the Tribunal has been upheld by the Hon’ble Apex Court as reported in 2018 (362) ELT A213 (S.C.) wherein the Hon’ble Apex Court has held that “we do not find any infirmity in the order passed by the CESTAT, the appeal is dismissed.”
14. In view of our discussion above, we are of the considered view that the impugned order is not sustainable in law and therefore, we set-aside the same by allowing the appeals of the department.
(Pronounced on 29.11.2 023)
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