M/S. Grand Metal Industries Pvt. Ltd vs C.C., Amritsar

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether Lordships wish to see the fair copy of the order? Seen 4. Whether order is to be circulated to the Department Authorities? Yes

Appeal Nos.C/196  197/2010-CU[DB]

[Arising out of Order-in-Appeal No.128-131/Cus/Ludh/09), dated 14.12.2009 passed by the C.C.(Appeals), Chandigarh-I]

M/s. Grand Metal Industries Pvt. Ltd. Appellant

Vs.

C.C., Amritsar Respondent

Appearance

Shri GS Agarwal, Director - for the appellant

Shri Amresh Jain, DR - for the respondent

CORAM: Honble Justice G. Raghuram, President

Honble Mr. R.K. Singh, Member (Technical)

Final Order Nos.52569-52570/2015, dated 17.08.2015

Per Mr. R.K. Singh :

Appeals have been filed against Order-in-Appeal dated 10.120.2009 in terms of which the appellants appeals were rejected by Commissioner (Appeals). The facts of the case briefly stated are as under:-

The appellant had imported aluminium scrap ISRI TENSE and filed the following four Bills of Entry:-

Sl.

No. Bill of Entry No. and

Date Customs Duty Involved (Rs.)

1.

137718, dated 06.02.2009

2,43,173.00

2.

137719, dated 06.02.2009

2,87,067.00

3.

137720, dated 06.02.2009

2,75,968.00

4.

137980, dated 11.02.2009

2,75,857.00

The Assessing Officer/Asst. Commissioner of Customs assessed the Bills of Entries by enhancing the value on the basis of DOV alert and the appellant agreed for the same and paid duty at enhanced value without any protest/objection. Subsequently, the appellant filed appeals before the Commissioner (Appeals), who taking note of the fact that the enhancement of value was done with the consent of the appellant rejected its appeals.

2. The appellant has contended that (i) the document relied upon by the Commissioner (Appeals) were not adduced before it, (ii) copy of the DOV alert was not provided, (iii) the value has to be determined as per the Customs Valuation Rules and that the enhancement of value was never accepted by the appellant. (iv) By presuming that the CHA had accepted the enhancement of value for getting goods released does not take away the right to appeal provided under the Act. (v) There is no estoppel in law against the authority in taxation matter and that the importer can challenge the enhancement of value although imported had consented at the time of clearance. It cited the judgements in the cases of Dunlop India Ltd. Vs. Union of India [1983 (13) ELT 1566 (SC)] and CC, New Delhi Vs. D.M. International [2013 (297) ELT 0450 (Tri.-Del.)].

3. The ld. Departmental Representative contended that the appellant having consented for enhancement of value, it is not open for it to contest later on.

4. We have considered the contentions of both sides. We find that it has been clearly recorded by the Commissioner (Appeals) that the appellant agreed to the loading and had categorically stated on the body of invoice that they have no objection if the value is loaded as per DOV alert. The appellants argument, in effect, that the consent by CHA cannot be taken to be its consent and its right of appeal is not extinguished because of that needs to be analysed. CHA is an agent of the appellant and therefore its action was binding on the appellant. Further, it cannot be the contention of the appellant that it was not aware that the CHA had given the consent for enhancement of value because, the duty was paid on the enhanced value without any protest and it cannot be tenably argued that it was done without its knowledge and consent. 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 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. The judgement in the case of Dunlop India Ltd. Vs. Union of India (supra) cited by the appellant was with regard to classification of goods and it essentially stated that even when the goods were cleared under a classification consented to by the assessee, the assessee was not debarred from seeking refund. The above judgement did not in any way mean that the refund should necessarily be granted only because the assessee questioned the classification earlier agreed to by it. The refund will have to be decided based upon the evidence and it is quite possible that the goods having been cleared, it may not always be possible in every circumstance to re-determine the classification; for example, if determination of classification requires the physical presence of the goods and if the goods were not available, re-classification cannot be done and hence refund would not be granted.

Similarly, 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 CC, New Delhi Vs. DM International (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.

5. We find that the CESTATs judgement in the case of Vikas Spinners Vs. CC, Lucknow [2001 (128) 143 (TRI  Del],CESTAT, dealing with a similar situation, held 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 added)

Similarly, in the case of Guardian Plasticote Ltd. Vs. CC (Port), Kolkotta [2008 (223) ELT 605 (Tri.  Kol.)] CESTAT has held as under:-

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.

The present case is thus squarely covered by the (above) judgements in the cases of Vikas Spinners and Guardian Plasticote Ltd.

6. In the light of the analysis above, we do not find any merit in the appeals and therefore the same are dismissed.

(Pronounced in the Open Court on 17.08.2015)

(Justice G. Raghuram)

President

(R.K. Singh)

Member (Technical)

SSK

-7-