2024-VIL-1321-DEL-CU
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CUSTOMS High Court Cases

Customs – Import of Polyester Knitted Fabric - Valuation, NIDB data - Customs authorities had enhanced the declared values of the imported goods solely based on the data available in the National Import Database (NIDB), without providing detailed reasons for the same - Whether the customs authorities can enhance the declared value of imported goods solely based on the NIDB data without providing detailed reasons - HELD - The Customs authorities cannot enhance the declared value of imported goods solely based on the NIDB data without providing detailed reasons - Court relied on various precedents which have consistently held that NIDB data alone cannot be the basis for enhancement of the declared value, and the authorities need to provide cogent reasons based on contemporaneous import data, quality, quantity and other relevant factors to justify the rejection of the declared value - The Customs authorities have a statutory obligation under Section 17(5) of the Customs Act and Rule 12 of the Customs Valuation Rules to pass a speaking order recording the reasons for rejecting the declared value. Mere reliance on NIDB data without establishing the reasons for doubting the accuracy or truthfulness of the declared value would not meet the requirements of the law - The CESTAT appears to have proceeded on the premise that the importer had all along agreed to the enhancement of the declared value and raised no protest. The CESTAT incorrectly proceeded on the basis that the communications addressed itself implied that the importers had willingly accepted the value as suggested by the customs authorities and consequently, the respondents being relieved of undertaking any adjudication as contemplated under Section 17 of the Customs Act in light of the abandonment and waiver of the appellant‘s right to challenge the reassessment - the orders of the CESTAT are set aside and matter is remanded to the customs authorities to re-examine the valuation of the imported goods in accordance with the principles laid down in the judgment - The appeals filed by the importers are allowed
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