TaxTMI 
TaxTMI 
2021 (7) TMI 969
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....o their reply in the said writ petition]. 2. This Court in the said judgment observed that it has been found by the Customs that he [the petitioner] has made some inaccurate statement in respect of minimum value addition in Bangladesh. That apart, some components contributing to the price could not be figured out. Thus, the verification on deficiency is prima facie justified. Within a short while, the reason for warehousing has been disclosed to the petitioner. The petitioner was apprised of his right of exercising option for the provisional assessment of the duty subject to final decision. The petitioner therefore might get the imported goods released on furnishing the Bank Guarantee (BG) for an amount of Rs. 12,74,031/-, but the petitioner has not done so in terms of the communication dated 17.10.2020 [Annexure-E to the reply]. In the facts and circumstances as surfaced, this court is not inclined to interfere in the manner, as asked for. The petitioner may take release of the imported goods covered by Bill of Entry No.659629/IMP/AGT-LCS/2020-2021 dated 29.09.2020 without prejudice to his claim. But he has to furnish security (bank guarantee or cash) for such release. 3. Th....
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....erges and is falls for consideration whether the verification is random verification falling under Rule 6(1)(c) of the CAROTAR, 2020 or the verification falls under the category leveled by Rule 6(1)(b) of the CAROTAR, 2020. The petitioner has brought categorical allegation against the respondents that he has furnished all requisite documents and information for clearance but the imported goods have been warehoused without any reason being disclosed to the petitioner whether those goods were held up for any verification regarding the Certificate of Origin produced by the petitioner for availing the concessional rate of the customs duty or for any other reason. This allegation has been levelled in para-7 of the writ petition and in reply thereof, the respondents have evaded any specific reply. They have simply stated that "assessment/clearance of goods has not been stopped. Only preferential treatment of customs duty has been denied till the doubt on the Country of Origin certificate is resolved. " The said reply does not conform to any verification under Rule 6(1)(b) of the CAROTAR, 2020 which is structured on the failure to provide the requisite information, as no such information ....
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....eceipt of information from verification authority which is Bangladesh in the case in hand. Those respondents have further stated that no information have been received from Bangladesh, the Country of Origin and hence, the period of 45 days has not even started. The respondents have categorically stated in para-4(i) of the objection as under: "4.(i) Petitioner is repeatedly stating that respondents do not have any record with regard to verification for the present Bill of Entry No.659298/IMP/AGT-LC/2020-21, dated 17-12-2020 and past Bill of Entry dated 29-09-2020, which is completely false. Department initiated verification against the Bill of Entry dated 17-12-2020 under Rule 6(1)(b) of CAROTAR, 2020 vice Letters C. No. IMP/MISC/4/2020-LCS/AGTL-COMMI-SHILL dated 30-12-2020 and C.No.IMP/MISC/4/2020-LCSAGTL-COMMI-SHILL/980, dated 12-01-2021 which was duly intimated to the petitioner vide Letter F.No. IMP/MISC/4/2020-LCS/AGTL-COMMI-SHILL dated 20-12-2020 and duly received by Shri Sankar Roy, Authorized signatory of the petitioner. Copy of letter under C.No.IMP/MISC/4/2020-LCS/AGTL-COMMI- SHILL, dated 30-12-2020 is enclosed as Annexure-B, copy of letter C.No.IMP/MISC/....
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....respondents also have asserted that the petitioner was asked to submit requisite information in terms of Rule 5 of CAROTAR, 2020 and the same was submitted by the letter dated 17.12.2020. They have further asserted in their objection that the cost break-up submitted vide the aforementioned letter was incomplete or insufficient, as the indicated materials as the "other", is shown as locally produced and the "the other" was not explained anywhere in the aforementioned letter submitted in terms of Rule 5 of CAROTAR, 2020. In sequel, in the objection, the respondents No.2 and 3 have asserted further as follows : "Now, as per 'Note' of Part B of section-III of Formal-I of CAROTAR, 2020, if origin of any of the components used in manufacturing of the final goods cannot be ascertained, same should be treated as non-originating. Therefore, 'other' in the indirect materials is liable to be treated as non-originating. Further, in the cost break up the cost of Branding ink/printing ink has been added twice. No satisfactory reply was received from the petitioner against this issue. Moreover, treating 'other' in the indirect materials and one of the two branding inks/....
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....nt in the 'Cost break up' dated 02.07.2020 they show indirect material others (not specified) at $ USD 141.10. It should be deducted as per 'note' of Part B of section-III of Form-I of CAROTAR, 2020, if origin of any of the components used in manufacture of final good cannot be ascertained, same should be treated as non-originating. Thus, the others components (not specified) should be deducted from the Percentage of local value content. In the cost break up dated 02.07.2020 (enclosed) they shown the total costing $ 971.99 [less others-sl.B] of cost break up -$ 141.10] and non-origin material should be $711.64(569.99 + 141.10). It appears the DVA may be [(971.99 - 711.64) x 100/971.99]=26.79% and value of non-originating material is 73.21%. b) Declaration of the local value content in the Form-I section-III Part-B para-2 Table sl.no. d. they show: The composition which consider value adding: Percentage of local value content: 40.00% (15.8% + 24.2.%) and components which constitute value addition as : i) Cromic Acid. ii) Hydrochloric Acid, iii) Finishing Chemical led. Iv)Branding Ink, v) Printing Ink, v....
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....Galvanized Steel Sheets vide BOEs 659298 & 659297/IMP-AGT-LCS/20-21 both dated 17.12.2020. Further, the documents submitted by you, under Rule 5(1) of CAROTAR, 2020, were scrutinized and some of the issues are still being verified. Moreover, it is also to inform you that previously some doubts had been raised by Assistant Commissioner on scrutiny of the Cost Break-up submitted by you vide BOE 659629/IMP/AGT-LCS/20-21 dated 29.09.2020 and the matter was forwarded to the Commissioner of Customs (P) NER, Shillong, as per Rule 5(5) of Notification No.81/2020 Cus (NT) dated 21.08.2020, in order to verify the Certificate of Origion (CoO) in terms of Rule 6 of the said notification. The same has been forwarded to The Director (International Customs Division) CBIC, New Delhi vide letter dated VIII(48)10/CUS/TECH/2020/Pt-1/10891 dated 9th Dec.2020. The reply to the same is awaited by this office till date. As such, it would not be possible, at the moment to accept the CoO submitted by you vide BOEs 659298 & 659297/IMP- AGT-LCS/20-21 both dated 17.12.2020. In view of the above scenario, in order to prevent any kind of financial loss/constraints, you may exercise the option ....
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....equire the importer or the person authorized by the importer to produce any document or information. Section 18 of the Customs Act, 1962 provides for the provisional assessment of the duty where the importer is unable to make self-assessment under Sub-section (1) of Section 17 and makes a request in writing to the proper officer for assessment. It has been provided under Section 18 of the Customs Act where necessary documents have not been produced or information has been furnished and the proper officer may deem it necessary to make further inquiry, then the proper officer may assess the duty leviable on such imported goods provisionally. In this regard, it may be pointed out that Section 18(1)(b) of the Customs Act provides that the imported goods may be subjected to any test for assessment of duty where proper officer deems it essential to do. The expression 'deems it necessary' means that proper officer must have good reason to subject imported goods to other tests. In Tata Chemicals Limited versus Commissioner of Customs reported in (2015) 11 SCC 628, the apex Court had occasion to observe that statutes often used expressions such as "deems it necessary," "reason to believe" e....
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....lly irrelevant. 15. Except the letter dated 20.12.2020 [Annexure-D to the objection filed by the respondents no.2 and 3 and Annexure-B to their reply filed in the writ petition] no other document or communication has been produced before the Court which can be treated as intimation in respect of the nature of verification or verification, it simply says that the documents submitted by the petitioner under Rule 5(1) of the CAROTAR, 2020 were scrutinized and some of the issues are still being verified. It does not even express any reason to believe that the Country of Origin criterion stated in the Certificate of Origin has not been met or the claim of the preferential rate of duty made by the importer is invalid. Thus, in view of the materials produced by the respondents No.1 and after extricating the relevant fact, the said verification are fall under Rule 6(1)(c) of CAROTAR, 2020. Rule 6(1)(c) of CAROTAR is reproduced hereunder for purpose of reference : "6(1)(c) verification is being undertaken on random basis, as a measure of due diligence to verify whether the goods meet the origin criteria as claimed." 16. This Court would express a note of serious annoyance at ....
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....ion of the Country of Origin certificate in respect of Bill of Entry dated 17.12.2020. How such request is made would be evident from the communication dated 09.12.2020 [Annexure-F to the reply filed by the respondents No.2 and 3 in the writ petition]. For purpose of illustration, the nature of action taken by the customs, the nature of action taken by the customs, the said communication dated 09.12.2020 is reproduced hereunder : GOVERNMENT OF INDIA Ministry of Finance, Department of Revenue Office of the Commissioner of Customs (Preventive) North Eastern Region 110 MG Road, Shillong, Meghalaya Phone:0364-2222597,2225325,2229005,2210103 Fax: 0364-2223440,2229007 Email:[email protected] E-MAIL Ref :VIII(48)10/CUS/TECH/2020/Pt.I Dated : 9th Dec, 2020 The Director (International Customs Division) Central Board of Indirect Taxes & Customs Department of Revenue, Ministry of Finance Room No.49, North Block, New Delhi-110001 Email:[email protected] Subject : Request for Verification of Country of Origin Certificate No.EPB(C) 25937 dated 28.09.2020 issued by Bangladesh under SAFTA-reg. Sir,....
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....nder random verification covered by Rule 6(1)(c) of CAROTAR, 2020 and as such, no bank guarantee can be asked from the petitioner. Moreover, there is no complaint about insufficiency of the information provided by the petitioner under Rule 5 of CAROTAR, 2020. The CBEC's circular No.38/2016- Customs dated 22.08.2016 and the circular No.42/2020 dated 29.09.2020 provide guidelines for provisional assessment under Section 18 of the Customs Act. Those further provide that if the cases selected on random basis for verification of the country of origin criterion, no security be asked for. In this regard, this Court would observe that when certain action does not fall within the category, the benefit usually would go in favour of the importer. 19. Since the errors in the judgment dated 26.04.2021 are apparent on the face of records. The line "the petitioner may take release of the imported goods covered by Bill of Entry No.659,629/IMP/AGT-LCS/2020-21 dated 29.09.2020 without prejudice to his claim" be deleted and substituted by the following sentence : "The petitioner may take release of the imported goods covered by Bills of Entry No.959298 IMP/AGT-LC/2020-21 dated 17.12.2020.....