Provisional customs assessment: arbitrary invoice value loading cannot justify re-finalisation after the original finalisation is set aside.

Finalisation of provisional customs assessment by loading invoice value must rest on recorded reasons and cannot be sustained if the loading is arbitrary. Where the appellate authority sets aside such finalisation, the department cannot be directed to re-finalise the assessment after further enquiry without a proper legal basis and compliance with natural justice. The order permitting re-finalisation was therefore not justified, and the assessee succeeded.

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Issues: Whether, after setting aside the loading of invoice value by 20% in finalisation of provisional assessment, the department could be permitted to re-finalise the assessment after further enquiry.

Analysis: The impugned order accepted that while provisional assessment may involve collection of revenue deposit up to 20% under the Customs (Provisional Assessment) Regulations, 1963, the assessing authority must give reasons when finalising the assessment and cannot sustain an arbitrary loading of invoice value. Once the appellate authority set aside the finalisation on that basis, there was no justification to direct a fresh finalisation after enquiry in the same manner. The order also reflected that any further action would have to conform to natural justice.

Conclusion: The direction permitting the department to re-finalise the assessment after enquiry was not justified. The appeal was allowed and the assessee succeeded.

Ratio Decidendi: An assessment finalised by loading value must be supported by reasons, and once such finalisation is set aside, a further re-finalisation cannot be directed without proper legal basis and compliance with natural justice.

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