2005 PLP (Trib (PTD)

SARFRAZ AHMAD KHAN, MEMBER (TECHNICAL). ‑‑‑This judgment disposes of two appeals as mentioned in the title since both involved common issues on law and facts and have been filed against Order‑in‑Original No. 38 of 2002, dated 18‑6‑2002 passed by Collector of Customs, Sales Tax and Central Excise (Adjudication), Lahore. Brief facts leading to this appeal are that both the respondents imported one consignment each from abroad and filed Bills of Entry No. 964, dated 2‑2‑2002 and 859, dated 10‑1‑2002 with the Lahore Dryport Customs. The concerned Customs authorities did not accept the declared transaction value and enhanced the same on the basis of Karachi Customs House data. Both the appellants filed separate Writ Petitions No. 3141 of 2002 and 1633 of 2002 in the Honourable Lahore High Court which vide its judgment, dated 15‑3‑2002 ordered the appellant department to release the consignments on charging of duty/taxes in cash according to the declared value and desiring the petitioners (present respondents) to furnish bank guarantees to the satisfaction of Collector of Customs to secure the payment of the disputed amount. The Honourable High Court also ordered that enhancement of value shall be properly adjudicated by competent functionaries of the department. The imported goods were got released provisionally accordingly and the learned counsel approached the Collector of Customs Sales Tax and Central Excise, (Adjudication), Lahore for necessary adjudication as ordered by the Honourable Lahore High Court. After hearing both the sides the adjudicating officer accepted the contentions of the respondent importers.

2. During hearing the learned SDR mainly reiterated the same arguments as given in the Grounds of written memo. of appeal, which are summarized as under:‑‑ (i) The data of Karachi Custom House was based on the imports made at Karachi pertaining to identical goods and the same could not be ignored/brushed aside, as done by the adjudicating officer. (ii) During pendency of the assessment proceedings, the concerned Customs authorities did not show the basis of enhancement of declared transaction value. This was sufficient to fulfil the requirement of section 25 of Customs Act, 1969. (iii) The evidential bills of entries referred to by the learned counsel as incorporated at paras. 2(b) and 3(c) and (1) of the impugned order, wherein declared transaction value was accepted, had not yet attained finality and could be subjected to post audit for taking action in terms of subsection (2) of section 32 of Customs Act, 1969. (iv) Collector of Customs (Adjudication) was not competent authority to adjudicate the case and the same was to be decided by the Collectorate of Customs, Lahore.

3. The learned counsel appearing on behalf of the respondent opposed contentions of the learned SDR on the following grounds:‑‑ (i) The respondent referred to Bills of Entry No. 3725, dated 12‑11‑2001, 04041, dated 22‑11‑2001, 04131, dated 26‑11‑2001, 04245, dated 29‑11‑2001 and 04561, dated 10‑12‑2001 under which identical goods of the same origin had been released by the Karachi Customs House at the same value. The appellants could not give any explanation for release of identical goods vide the aforementioned bills of entry at the same value as that of the respondents. (ii) Compliance of the provisions of subsection (4) of section 25 of Customs Act, 1969 read with Customs Rules, 2001 was mandatory as held by the Lahore Bench‑I of this Tribunal vide its consolidated judgment, dated 30‑6‑2003 in Appeals Nos. 90, 55, 56/LB/2003 and hence non‑compliance of the mandatory provisions rendered the whole action illegal. (iii) Collector of Customs (Adjudication) was the competent adjudicating authority as held by the Lahore Bench‑I vide its judgment, dated 22‑7‑2003 in Appeal No. 142/LB of 2003 and applied to four others. Moreover the impugned order was the result of consent judgment and hence could not be appealed against.

4. We have heard contentions of both the sides and perused the appeal files available before us. After coming into force of the new section 25 of Customs Act, 1969 vide Finance Act, 1999 and as amended by Finance Ordinance, 2000 the value of customs purposes is transaction value‑‑‑the price actually paid or payable for the goods when sold for export to Pakistan, in terms of subsection (1) section 25 ibid. In case the appropriate officer of Customs had reservations 4n acceptance of the declared transaction value, it was obligatory on his part to "inform the importer of reservation in writing and give the importer .an opportunity to justify the price difference", in terms of subsection (4) of section 25 of Customs Act, 1969. On failure of the importer to justify the price difference then transaction value of identical goods (subsection (5) of. section 25 ibid), transaction value of similar goods (subsection (6) of section 25 ibid), deductive value; (subsection (7) of section 25 ibid), computed value (subsection (8) of section 25 'bid), and fall back method (subsection (9) of section 25 ibid), were to' be applied in the same sequential manner; as per subsection (10) of section 25 ibid. These were mandatory provisions of law and could not be deviated. Admittedly the appellant did not fulfil the requirement of subsection (4) of section 25 of Customs Act, .1969. Data of Karachi Custom House could not be applied as such except in the same format, as aforesaid, as given in subsections (5), (6), (7), (8) and (9) of section' 25 ibid in the same sequential order, after fulfilling the mandatory provisions of sub‑' section (4) of section 25 ibid. The adjudicating officer has even reproduced C.B.R.'s instructions issued vide C. No. 1(25)S/BAL/98, dated 22‑7‑2000 wherein it was intimated that valuation data basis was to be discontinued. Besides the appellant failed to justify release of identical goods vide bills of entry referred to by the respondent, as mentioned at para. 3(C) of the impugned order. As far the jurisdiction, Lahore Bench‑I of this Tribunal has already held, vide its consolidated judgment, dated 22‑7‑2003 in Appeal No. 142/LB of 2003 (applied to five appeals) that Collector Adjudication was the competent adjudicating officer when an importer felt aggrieved 'regarding assessment of his: imported consignment by the concerned Customs authorities.

5. For what has been stated above, we do not find any fault in the impugned orders and therefore, the same are confirmed and both the appeals are dismissed. S.A.K./280/Tax (Trib.) Appeals dismissed.