2024 (6) TMI 1461 - AT - Customs

Violation of principles of natural justice - no speaking order - Challenge to order of adjudication under section 17(4) of Customs Act 1962 - enhancement of value and classification of goods - HELD THAT - The Adjudicating Authority sought to change the classification and to enhance the value of assessment in the bill of entry by doing so under Section 17(4) of the Act but no order has been passed under section 17(5) of the Act which is mandatory for the Adjudicating Authority to pass a speaking order for change of classification and enhancement of value. The said order was challenged by the Respondent before the Ld. Commissioner (Appeal) who examined the record and held that as no order under section 17(5) has been passed by the Adjudicating Authority in that circumstance the enhancement of value and change of classification is not sustainable. The observation made by the Ld. Commissioner (Appeal) in the impugned order agreed upon wherein it has been held that the Adjudicating Authority is mandatorily required to pass the speaking order under section 17(5) of the Act which Adjudicating Authority fails to do so. There are no merit in the appeal - appeal dismissed.

Summary

The Appellate Tribunal (CESTAT Kolkata) dismissed the Revenue's appeal against the Commissioner (Appeals) order, which held that the adjudication order under section 17(4) of the Customs Act was unsustainable due to the absence of a mandatory speaking order under section 17(5). The case involved classification and valuation of Electric Tricycle Spare Parts declared under CTH 8703.80.40. The Tribunal agreed that "the Adjudicating Authority is mandatorily required to pass the speaking order under section 17(5) of the Act," which was not done. Consequently, enhancement of value and change of classification were not justified, and the impugned order was upheld.