2025 (6) TMI 205 - AT - Customs

Seeking amendment of Bills of Entry under section 149 of the Customs Act - import of different varieties of fabric - claim CVD exemption in terms of Notification No.30/2004-CX - correction of clerical errors - HELD THAT - We note from records that the orders of the adjudicating authority as discussed in appeal order is well reasoned coherently amplifying the grounds on which basis provisions of Section 149 and Section 154 of the Customs Act cannot be resorted to and made applicable to the issue herein. The appellant had themselves filed the import bills in the manner as aforestated. It is apparent that there is no arithmetical or clerical mistake in the assessments so done. The assessment without the claim for exemption benefit is indeed a consequence of the conscious action taken at the time of import. Irrespective of the fact of whether it being the right or wrong course of action it cannot be considered as an error arising from an accidental slip or omission in the decision or order of the assessing authority hence the question of invoking the provisions of Section 154 for correction of clerical/arithmetical error cannot be applied to in the present matter. Amendment is no substitute to assessment/re-assessment and cannot replace it as the two terms apply in different context have distinct overtones and outcomes in law. Amendment alone of import/export documents may not be sufficient in seeking the desired results. The two terms are not interchangeable. To derive the intended objective the amended document if any would be required to be re-assessed in the light of such an amendment which alone can be done once the assessment order is set aside by a direction from the superior authority. Suo moto of one s own accord the authority cannot in itself undertake any re-assessment having been rendered as functus officio. This logic and discourse also seeks to not only bring about the assigned objective and give a meaning to the different provisions of the statute like Section 17 (Assessment/Reassessment related) Section 128/Section 129 (Appeal related Section 149 (Amendment related) and Section 154 (Correction of clerical errors related) it also defines the individuality and relevance of each of the provisions without reducing any of such a provision to dead wood. Also any interpretation outsmarting one provision against the other is bound to create chaos and confusion. In view of our findings above we are of the view that the route sought to be adopted by the Ld. Counsel by seeking amendment in terms of Section 149 that too after a prolonged period of several years for an omission made by them cannot be justified. As discussed above amendment and assessment/re-assessment signify two clearly distinct connotations importing distinct and separate meanings and encompassing different areas of action. We are thus not able to appreciate any merit in the view as canvassed by the Ld. Counsel. An amendment simplicitor cannot lead to the consequence of demand of duty or a claim for refund for which the original assessment done is required to be reversed by a process as known to law as also held by the hon ble apex court in the ITC Ltd. case we also would like to put it on record that the ld. Commissioner has thus completely erred in directing the lower authority to consider the amendment of the Bill of Entries . There is nothing for consideration of the amendment as merely carrying out the amendment is of no consequence unless the Bills of Entry are re-assessed. None of the earlier assessments have been appealed at all; the outcome of such an amendment continues to hold fort till such time it is set aside by the appropriate authority and a fresh assessment done revisiting the earlier assessment. Thus we are of the view that the order of the ld. Commissioner(Appeals) is not in accordance with law and is therefore set aside. The appeals filed by the department are allowed.

Summary

The core legal questions considered by the Tribunal revolve around the permissibility and scope of amendment of Bills of Entry under Section 149 of the Customs Act, 1962, particularly when such amendments are sought several years after the original import and assessment. The issues include whether amendment under Section 149 can be used as a substitute for reassessment under Section 17(4), the applicability of Section 154 for correction of clerical or arithmetical errors in assessment orders, the timelines within which such amendments or reassessments can be validly carried out, and the interplay between amendment, reassessment, and appeal provisions under the Customs Act. The Tribunal also examined the relevance and binding effect of precedents from various High Courts and the Supreme Court, especially regarding the finality of assessment orders and the proper legal remedy to claim exemption benefits not availed at the time of import.

Regarding the first issue of whether amendment under Section 149 can be used to claim exemption benefits not claimed at the time of import, the relevant legal framework includes Section 149, which empowers the proper officer to authorize amendments to documents presented at the customs house, subject to prescribed conditions and limitations. The proviso to Section 149 restricts amendments after clearance of goods except on documentary evidence existing at the time of clearance. Section 17(4) allows reassessment by the proper officer if self-assessment is found incorrect upon verification or examination. Section 154 permits correction of clerical or arithmetical mistakes or errors arising from accidental slips or omissions in decisions or orders. The apex court's ruling in ITC Ltd. v. Commissioner of Central Excise clarified that reassessment is permissible only under Sections 17(3), (4), and (5), and that an order of self-assessment is appealable under Section 128. It emphasized that modification of an assessment order is a prerequisite for claiming refund or exemption benefits post-assessment.

The Tribunal interpreted these provisions and precedents to hold that amendment under Section 149 cannot be equated with reassessment under Section 17(4). Amendment pertains to correction of documents and does not, by itself, modify the substantive assessment order. Reassessment involves setting aside the original assessment and substituting it with a revised order, which requires either a direction from a superior authority or an appeal process under Section 128. The Tribunal reasoned that allowing amendment to substitute reassessment would circumvent the statutory safeguards and timelines prescribed for reassessment and appeals, potentially leading to legal uncertainty and administrative chaos.

Key evidence and findings include the fact that the appellants imported goods around 2016 but sought amendment only in 2021, well beyond any reasonable or statutory timeline for reassessment or amendment. The original Bills of Entry were self-assessed without claiming exemption under Notification No.30/2004-CX. The assessing authority rightly refused amendment under Section 149, characterizing the request as an attempt at reassessment without following the proper legal procedure. The Tribunal noted that no clerical or arithmetical mistake existed in the original assessment; rather, the omission of exemption was a conscious decision by the appellants at the time of import.

In addressing competing arguments, the respondents relied on decisions from the Bombay and Telangana High Courts permitting amendment under Section 149 read with Section 154 for correction of inadvertent errors, citing cases such as Dimension Data India Pvt. Ltd. and Soni India Pvt. Ltd. The Tribunal distinguished these cases on factual grounds, noting that in those instances, amendment requests were made within a reasonable timeframe (2-3 months) and involved genuine clerical errors or classification issues, whereas the present case involved a delay of about five years and a substantive change in the assessment. The Tribunal also rejected the contention that non-grant of exemption was a clerical mistake under Section 154, emphasizing that assessment is a substantive statutory act, not an administrative or clerical one.

The Tribunal further examined other High Court decisions, including Travancore Cocotuft Pvt. Ltd. and Stanley Engineered Fastening Pvt. Ltd., and a recent Tribunal decision in CC(Port), Kolkata vs. M/s. Uma Export Ltd., finding them inapplicable due to differing factual and legal contexts. It underscored that reassessment can be undertaken by the proper officer under Section 17(4) without superior authority direction but only at the time of import or when goods are in custody, not years later. The Tribunal reiterated that amendment under Section 149 does not provide a route to bypass the appeal mechanism or extend timelines for reassessment.

On the issue of timelines, the Tribunal highlighted the consistent judicial emphasis on "reasonable period" for statutory actions, generally about six months and in exceptional cases up to five years. The appellants' delay of nearly six years exceeded these thresholds, rendering their amendment request untenable. The Tribunal also referred to the principle that an assessment order, once final and not set aside by appeal, must be complied with, and no refund or exemption can be granted without modification of that order through proper legal channels.

Regarding the distinction between amendment, assessment, and appeal, the Tribunal relied on authoritative legal definitions from Black's Law Dictionary, emphasizing that amendment is a formal revision of documents, assessment is the determination of duty payable, and appeal is a proceeding to have a decision reconsidered by a higher authority. These concepts are independent and non-interchangeable, each with distinct legal consequences and procedural requirements.

The Tribunal concluded that the appellants' attempt to use Section 149 amendment to claim exemption benefits after a prolonged delay was legally impermissible and that the Commissioner (Appeals) erred in directing the lower authority to consider such amendment without reassessment. It held that amendment alone cannot effect a change in the substantive assessment order or lead to refund claims. The proper remedy lies in following the appeal mechanism under Section 128 and reassessment under Section 17(4) within prescribed timelines.

Significant holdings include the following verbatim excerpts encapsulating the Tribunal's legal reasoning:

"Reassessment of any assessment cannot be equated with an amendment under section 149. No parallels can be drawn between the two. Both are independent provisions meant to cater to specific arena of action."

"Amendment simplicitor cannot lead to the consequence of demand of duty or a claim for refund, for which the original assessment done is required to be reversed by a process as known to law and it is thus a crucial link in the process for which at this juncture the only remedy lies in following the Section 128 route."

"The provisions only seek to correct clerical or arithmetical mistakes in any decision or orders passed and such errors, as may arise by way of an accidental slip or omission. The assessment undertaken by the department cannot be construed as a clerical or arithmetical error."

"Assessment proceedings are a substantive act and any infirmity having crept therein can only be made good by way of a process as built in law i.e. either by adopting the appeal mechanism as provided in law and permissible within the framework of Section 17."

"The law provides for an appeal mechanism which cannot be substituted by seeking recourse to the provisions concerning amendment or correction of the relevant documents."

"The order of self-assessment is an order of assessment in terms of Section 2(2), and was appealable by any person aggrieved by it."

"Once an assessment is done, only on appeal, reassessment is possible and any demand/refund on account of valuation or for any other reason has to be within the frameworks of laws as laid down under Section 28/27 of the Customs Act, 1962."

In final determinations, the Tribunal set aside the order of the Commissioner (Appeals) that had allowed amendment of Bills of Entry under Section 149 to claim exemption benefits after several years. It held that such amendment could not substitute reassessment or appeal, especially after the lapse of statutory timelines. The appeals filed by the Revenue were allowed, affirming the finality of the original assessments and underscoring that any challenge to such assessments must follow the prescribed legal procedures and timelines. The Tribunal clarified that amendment and reassessment are distinct legal processes and that the proper course for seeking exemption benefits post-assessment is through appeal and reassessment under the Customs Act, not through belated amendment of import documents.