Customs reassessment needs a speaking order and natural justice; otherwise the audit route under Section 17(6) applies.

Reassessment of a Bill of Entry after self-assessment requires compliance with the statutory scheme under the Customs Act, including a speaking order where reassessment departs from self-assessment. Where reassessment is not completed in the prescribed manner and no speaking order is passed, the assessment cannot attain finality and the audit mechanism under Section 17(6) becomes the appropriate route. The document also treats observance of natural justice as necessary before reassessment can be sustained. On this basis, reassessment without a speaking order was not upheld and the assessment issue was remitted to the Assessing Authority through the audit route.

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Issues: Whether reassessment of the Bill of Entry could be sustained without a speaking order and whether the assessment had to be dealt with under the audit mechanism contemplated by Section 17(6) of the Customs Act, 1962.

Analysis: The assessment was verified under self-assessment provisions and reassessment was undertaken, but no speaking order was passed on the reassessment. In such a situation, the statutory scheme required compliance with Section 17(5) where reassessment is contrary to self-assessment, and if reassessment has not been completed in the required manner or a speaking order is absent, Section 17(6) permits audit of the assessment. The requirement of a speaking order and observance of natural justice was treated as necessary before the assessment could attain finality.

Conclusion: Reassessment without a speaking order was not upheld, and the matter was required to proceed through the audit route under Section 17(6), with the Revenue appeal dismissed and the assessment issue remitted to the Assessing Authority.

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