TaxTMI 
TaxTMI 
2021 (3) TMI 1090
X X X X Extracts X X X X
X X X X Extracts X X X X
....etitioner had imported smart plugs vide Bill of Entry No.8311310 dated 28.07.2020. It is stated that the imported smart plugs are used for extension socket purposes and since the same does not generate any wi-fi or bluetooth signal, petitioner claims that no import licence from the Wireless Procurement Cell, Department of Information and Technology, Government of India was required. Petitioner also got the product tested to certify that the technical features of the product did not fall under licensing requirement. 5. Notwithstanding the above, the apprising officers raised objection regarding requirement of import licence with respect to the imported products. Petitioner agreed for a first check examination of the same which was carried out in the presence of the authorised representative of the petitioner. During the said examination neither any objection was raised nor any inconsistency was found. Despite the above, at the insistance of officers serving in the office of Joint Commissioner of Customs, Nhava Sheva-V i.e. respondent No.3, petitioner furnished three declarations dated 02.09.2020 certifying the truth and veracity of all the declarations. Thereafter office of respo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....es took the view that it would be in the interest of justice if interim relief was granted to the petitioner making it clear that such relief would be subject to outcome of the writ petition. Accordingly, interim relief in terms of prayer clause 23(c)(iii) which has been extracted above was granted. 11. Respondents have filed reply affidavit through Shri. Rajesh Kumar Mishra, Commissioner of Customs, Nhava Sheva-V, Jawaharlal Nehru Customs House, Nhava Sheva. At the outset, a preliminary objection has been raised that against the impugned order in original there is a statutory remedy of appeal as provided under section 128 of the Customs Act before the Commissioner (Appeals). Therefore, the writ petition should be dismissed on the ground of petitioner not availing the alternative remedy as provided under the statute. The allegation that there has been gross violation of the principles of natural justice has been denied. It is stated that initially a query was raised by the office of respondent No.3 on 30.07.2020 and in response thereto petitioner submitted a declaration (dated 'nil') that the imported product was smart plug used for extension socket purpose. It was stated that a....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the writ petition. 12. Learned counsel for the petitioner has referred to paragraphs 10, 11 and 12 of the writ petition as well as to the impugned order in original dated 23.09.2020 and submits that the same was passed in violation of section 124 of the Customs Act inasmuch as no show-cause notice was issued to the petitioner before the order of confiscation was passed by way of the impugned order in original. He has also referred to Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 to contend that in the event of any dispute as to the value of imported goods as declared the proper officer has to intimate the importer in writing about the grounds for doubting the truth or accuracy of the value and provide a reasonable opportunity of being heard before taking a final decision. In the instant case neither any show-cause notice was issued nor any intimation was given to the petitioner in writing about the grounds for doubting the truth or accuracy of the declared value of the imported goods. No reasonable opportunity of being heard was provided to the petitioner before passing the impugned order in original dated 23.09.2020. Learned counsel....
X X X X Extracts X X X X
X X X X Extracts X X X X
....SD 22.02365. Thus he opined that the importer (petitioner) attempted to clear goods by submitting false declarations and under valueing the goods rendering the goods liable for confiscation under section 111(m) of the Customs Act besides being liable for penalty under section 112(a) of the Customs Act. Thereafter the following order was passed :- "14. I reject the unit price of the goods declared as -'SYSKA-MWP-002-BPLEDSL24W(Smart Plug) at USD 4.13 (FOB value) and 'SYSKA-MWP-003-BPLEDSL24W(Smart Plug)' at USD 5.036 (FOB value) by the importer. I order the same to be re-determined as USD 13.66097(CIF value) and USD 22.02365(CIF value) respectively (as detailed in the Table A). I order the importer to pay resulting differential duty thereon along with applicable interest under Section 28AA of the Customs Act, 1962. The bill of entry may be assessed accordingly. 15. I confiscate the goods imported vide subject bill of entry No.8311310 dated 28.07.2020 under Section 111(m) of the Custom Act, 1962. However, I given an option to redeem the same upon payment of redemption fine of Rs. 4,00,000/- (Rupees Four Lacs only) under Section 125 of the Custom Act, 1962. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ner of the goods or such person must be given an opportunity of making a representation in writing within such reasonable time as may be stated in the notice against the grounds of confiscation or imposition of penalty and finally the owner of the goods or such person is given a reasonable opportunity of being heard in the matter. Thus three conditions are required to be fulfilled before an order of confiscation is passed or penalty is imposed. Firstly, the person concerned shall be given a notice in writing informing him of the grounds on which the goods are proposed to be confiscated or penalty is proposed to be imposed. Secondly, such person has to be given an opportunity of making a written representation within reasonable time against the grounds of proposed confiscation or imposition of penalty. Lastly, such a person must be given a reasonable opportunity of being heard. However, as per the first proviso, such a notice and representation may be given orally at the request of the person concerned. 20. Admittedly in this case, no notice in writing under section 124(a) of the Customs Act was given to the petitioner before passing the impugned order in original which not only ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rted at or about the same time in comparable quantities in a comparable commercial transaction were assessed; (b) the sale involves an abnormal discount or abnormal reduction from the ordinary competitive price; (c) the sale involves special discounts limited to exclusive agents; (d) the misdeclaration of goods in parameters such as description, quality, quantity, country of origin, year of manufacture or production; (e) the non declaration of parameters such as brand, grade, specifications that have relevance to value; (f) the fraudulent or manipulated documents." 22. A careful perusal of Rule 12 as extracted above would go to show that if the proper officer has reason to doubt the truth or accuracy of the value declared in relation to any imported goods, he may ask the importer of such goods to furnish further information and at the request of the importer shall intimate the importer in writing the grounds for doubting the truth or accuracy of the value declared in relation to imported goods and provide a reasonable opportunity of being heard, before taking a final decision. 23. From a reading of the impugned order in original, i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t the transaction value of such imported goods cannot be determined under the provisions of sub-rule (1) of Rule 3. Sub-rule (2) of Rule 12, provides that at the request of an importer, the proper officer shall intimate to the importer in writing the grounds for doubting the truth or accuracy of the value declared in relation to goods imported by the importer and provide a reasonable opportunity of being heard, before taking a final decision under sub-rule (1). Explanation (ii) to Rule 12 posits an enquiry in consultation with the importer. The subordinate legislation has expressly incorporated norms requiring observance of the principles of natural justice. 12. The provisions of Rule 12 contain the procedure which the proper officer is required to follow before rejecting the declared value. In the first instance, when the proper officer has reason to doubt the truth or accuracy of the value, he may ask the importer to furnish further information including documents or other evidence. If upon a scrutiny of the information he is satisfied with the transaction value declared, then in such a case the provisions of Rule 3(1) would come into operation. On the other hand, if the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....pportunity of being heard with reference to those grounds, there has been a clear breach of principles of natural justice. 14. We are not inclined to accede to the submission of Counsel appearing on behalf of the respondents that the petitioners should be relegated to the remedy of an appeal in these circumstances. There has been a clear breach of the principles of natural justice by the failure on the part of the Deputy Commissioner of Customs to follow the mandatory requirement of Rule 12. The existence of an alternate remedy of an appeal is not a bar to the maintainability of a petition under Article 226 of the Constitution where there is a breach of the principles of natural justice. Moreover, the mere existence of an appellate remedy, it is well settled, would not remedy a breach of the principles of natural justice at the original stage. We also take serious note of the statement made in the affidavit in reply to the effect that even if this Court would direct the Deputy Commissioner of Customs to issue a notice to show cause, the grounds of the notice would be the same as those contained in the impugned order and that the quasi judicial order which the authority wou....