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TMI Blog2025 (2) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... vealed that the modus operandi adopted by importers of electronic calculators from China appeared to be to declare the unit price and Retail Sale Price (RSP) for a dozen calculators, instead of per piece basis, as is the normal practice, so that at a glance the assessing officer would be tricked into believing that the value / RSP declared is fair. SIIB recalled the BOE and took up one such case for examination after the same was facilitated through the RMS. After due process of law, the Ld. Original Authority rejected the declared value on dozen basis and redetermined the value of the consignment on per piece basis, based on a market enquiry, to be totally valued at Rs.33,60,468 under Rule 9 of Customs Valuation (Determination of Price of Imported Goods) Rules, 2007 (CVR 2007). He demanded differential duty along with interest and also imposed a penalty. In appeal, the Ld. Commissioner (Appeals) upheld the order. Hence this appeal. 3. The Ld. Counsel Shri N. Viswanathan appeared for the appellant and Ld. Authorized Representative Shri N. Sathyanarayana appeared for the respondent. 3.1 The Ld. Counsel for the appellant submitted that the goods in the consignment were as per the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1988. A new rule, Rule 10A has been added to the existing Customs Valuation Rules, 1988 to give effect to the decision taken by the Ministers of the Countries which the signatories to GATT, 1994, (copy enclosed). The rule 10A reads as follows:- "10A. Rejection of declared value:- (1) When the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, he may ask the importer of such goods to furnish further information including documents or other evidence and if, after receiving such further information, or in the absence of a response of such importer, the proper officer still has reasonable doubt about the truth or accuracy of the value so declared, it shall be deemed that the value of such imported goods cannot be determined under the provisions of sub-rule (1) Rule 4 (2) At the request of an importer, the proper officer, shall intimate the importer in writing, the grounds for doubting the truth or accuracy of the value declared in relation to goods imported by such importer and provide a reasonable opportunity of being heard, before taking a final decision under sub-rule (1)" 2. As you are aware, as per rule 4 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication No. 10/98(NT) C dt. 19/2/98, GSR No. 77 dated 19.2.98. 8. Any further clarifications/ comments in the matter may be sent to the undersigned. Sd/ (P.R. V. Ramanan) Joint Secretary (Customs) (emphasis added) However over a period of time the Customs Valuation (Determination of Price of Imported Goods) Rules, have come to be modified, and we are currently dealing with the 2007 version, the circular brings out the difficulty in rejecting a declared value even though in some cases invoices were found to be manipulated but on the face of it the transaction value (i.e. the invoice price) is projected to be true and correct or the value was found to be substantially lower than the prevailing international market price. The Issue does not appear to be localised to India alone as the circular mentions that the Rule has been added to give effect to the decision taken by the Ministers of the Countries which are signatories to GATT, 1994. The Rule thus seeks to address the 'mischief of manipulated values declared by some importers by not correctly disclosing the transaction value based on documents which are in their exclusive possession'. 5. A three Judge bench of the h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ged the appellant from giving a reply and violates the principles of natural justice. 7. In Commissioner of Sales Tax, U.P. v. R.P. Dixit Saghidar (2001 (9) SCC 324), it was held that when principles of natural justice are stated to have been violated it is open to the appellate authority, in appropriate cases, to set aside the order and require the Assessing Officer to decide the cases de novo. This is because when an order is held to be invalid due to a violation of principles of natural justice, there is no final decision of the case and therefore proceedings are left open and the proceedings are not terminated. This being so we feel it appropriate to remand the matter to the Original Authority to cure the defect by supplying a copy of the 'Market Inquiry Report' and worksheet to the appellant and decide the matter afresh. 8. Having regard to the discussions above we remand the matter back to the Original Authority for de novo adjudication after supplying a copy of the 'Market Inquiry Report' and worksheet to the appellant. The lower authority shall follow the principles of natural justice and afford a reasonable and time bound opportunity to the appellant to state their case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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