2024 (3) TMI 1416 - AT - Customs

Customs officer's denial of SAFTA origin benefit illegal without mandatory speaking order under Section 17(5)

M/s. HDS Steel Traders Private Limited Versus Commissioner of Customs (Port) Custom House, Kolkata

CESTAT Kolkata held that denial of SAFTA country of origin benefit under Notification 99/2011-Customs was unsustainable. The proper officer re-assessed ... Benefit of country of origin (SAFTA) as per N/N. 99/2011-Customs dated 09.11.2011 - appellant contended that till date, no speaking order of assessment had been received by them u/s 17(5) of the Customs Act, 1962 - HELD THAT:- An importer is required to file their Bill of Entry and self-assess the duty leviable on the goods imported, under Section 17(1) of the Act and if the proper officer is not of the view that the assessment has been done by the importer correctly, then he may re-assess the duty leviable on such goods, under Section 17(4) of the Act. Section 17(5) mandates that if the re-assessment done under Section 17(4) is contrary to the assessment done by the importer, then a speaking order is to be passed on the re-assessment, within a period of fifteen days from the date of re-assessment of the Bill of Entry. Admittedly, in this case, no reasons have been assigned by the proper officer for denying the benefit of country of origin (SAFTA) under Notification No. 99/2011-Cus. dated 09.11.2011. It is observed that the certificate of origin have already been defaced by the proper officer. Moreover, as the country of origin certificate has already been defaced, which clearly shows that the proper officer has accepted the country of origin certificate and nothing adverse has been found, in these circumstances, the proper officer was required to pass a speaking order under Section 17(5) of the Act. As no such order has been passed by the proper officer in this case, therefore, re-assessments of the Bills of Entry under Section 17(4) of the Act are illegal. Conclusion - The denial of the country of origin benefit was not sustainable. Appeal allowed. The issues presented and considered in the legal judgment are as follows:1. Whether the appellant is entitled to the benefit of the country of origin (SAFTA) under Notification No. 99/2011-Customs dated 09.11.2011.2. Whether the assessments conducted under Section 17(4) of the Customs Act, 1962 without the issuance of a speaking order under Section 17(5) are legal and sustainable.Issue-Wise Detailed Analysis:Issue 1:Relevant Legal Framework and Precedents:- Section 17 of the Customs Act, 1962 outlines the assessment of duty for imported goods.- The judgment references the case of Niraj Silk Mills & Ors. v. Commissioner of Customs (ICD), Patparganj, where the High Court emphasized the requirement for a proper officer to pass a speaking order under Section 17(5) when reassessing values.Court's Interpretation and Reasoning:- The court analyzed the provisions of Section 17, emphasizing the requirement for self-assessment by importers and the subsequent re-assessment by the proper officer if necessary.- The court highlighted the importance of a speaking order under Section 17(5) to provide reasons for any re-assessment contrary to the importer's assessment.Key Evidence and Findings:- The appellant had claimed the benefit of the country of origin under Notification No. 99/2011-Customs.- The proper officer defaced the certificate of origin without issuing a speaking order under Section 17(5).Application of Law to Facts:- The court applied the provisions of Section 17 and the precedents from the Niraj Silk Mills case to determine the legality of the assessments in question.- It concluded that the denial of the country of origin benefit without a speaking order was not sustainable.Treatment of Competing Arguments:- The appellant argued for the entitlement to the country of origin benefit based on the defaced certificate of origin and lack of a speaking order.- The Revenue representative contended that the appeals were not maintainable due to the appellant relinquishing the benefit claim.Conclusions:- The court held that the denial of the country of origin benefit was not sustainable.- The impugned order was set aside, and the appellant was deemed entitled to the benefit under Notification No. 99/2011-Customs.- The appeals were allowed with consequential relief as per the law.Significant Holdings:- The court emphasized the necessity of a speaking order under Section 17(5) when reassessing values contrary to the importer's assessment.- The judgment established the illegality of assessments conducted without a speaking order and upheld the appellant's entitlement to the country of origin benefit.End of Analysis.