Review limitation and valuation rules: file-signing date governs review time, and cost-based valuation stands without proper comparable-goods evidence.

Limitation for departmental review was computed from the date the competent Commissioner signed and passed the review order in the file, so the departmental appeals were within time. On valuation, the show cause notices lacked adequate factual particulars and proper market enquiry to sustain comparable-goods valuation; in that setting, the residual cost-based method supported by a Chartered Accountant's certificate was upheld. The same costing basis was accepted for clearances by a 100% export oriented unit. The Assistant Commissioner's valuation and the resulting orders were therefore sustained, and no ground was found to interfere.

---

---

Issues: (i) Whether the departmental review and appeal were barred by limitation under the statutory time limit for review orders; (ii) Whether the value of the goods was correctly determined under the valuation rules on the basis of comparable goods or cost of production, including in the case of a 100% export oriented unit.

Issue (i): Whether the departmental review and appeal were barred by limitation under the statutory time limit for review orders.

Analysis: The time limit for exercise of review power was held to run from the date on which the Commissioner signed and made the review order in the file, not from the date of communication. Applying that principle, the review direction was found to have been issued within time. The record also showed that the Commissioner had examined the proceedings and, by ordering review, had satisfied himself regarding the legality and propriety of the lower order.

Conclusion: The departmental appeals were not barred by limitation.

Issue (ii): Whether the value of the goods was correctly determined under the valuation rules on the basis of comparable goods or cost of production, including in the case of a 100% export oriented unit.

Analysis: The show cause notices did not disclose adequate details of the market enquiry or a proper comparison of comparable goods to justify valuation on the basis of alleged under-valuation. In the absence of supporting particulars, valuation on comparable-goods basis was not justified, and the lower authority was justified in determining value on the basis of the Chartered Accountant's certificate under the residual costing method. For the 100% export oriented unit, the valuation was also held to be correctly worked out on the same costing basis under the applicable valuation rules.

Conclusion: The valuation adopted by the Assistant Commissioner was upheld.

Final Conclusion: No ground was found to interfere with the orders of the Assistant Commissioner, and the departmental appeals failed on merits as well as on the limitation objection.

Ratio Decidendi: For review proceedings, limitation runs from the date the competent authority signs and passes the review order in the file, and where the show cause notice lacks a proper factual foundation for comparable-goods valuation, the residual cost-based method may be adopted, including for clearances by a 100% export oriented unit.

---