Customs Duty Amount Involved Is Less Than Threshold Limit: CESTAT Dismissed Dept.'s Appeal

The Chandigarh Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has dismissed the dept.'s appeal, in which the customs duty amount involved is less than Rs. 50 lakhs.

The bench of S. S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) has observed that the appeals do fall within the instructions as prescribed in the circular dated November 2, 2023. The CESTAT, the High Courts, and the Supreme Court have been consistently dismissing the appeals of the Revenue if they are below the monetary limits as prescribed in circulars issued by the CBIC from time to time.

The department filed 26 appeals against a common order passed by the Commissioner of Customs (Appeals), by which the Commissioner (Appeals) has set aside the assessment made by the department on enhanced value as per the acceptance or admission by the importer, assessee, or respondent.

The respondent or assessee imported goods by declaring the goods as 'lots of non-textured polyester fabrics or polyester knitted fabrics' and self-assessing the duty of Rs. 2,17,627/-. The Bill of Entry was re-assessed by the Deputy/Assistant Commissioner of Customs at a higher assessable value than the declared assessable value, and the total re-assessed duty came to Rs. 3,48,091/- on the goods. As per the department, the importer at the time of clearance accepted the value enhancement and gave in writing the acceptance of the re-assessed value on the ground that the value declared by them was lower than the value at which identical or similar goods were being imported at the same time in comparable quantity at other ports of the country.

The importer challenged the re-assessment and filed appeals before the Commissioner (Appeals), who set aside the assessment order on enhanced value and allowed the appeals of the assessee with a direction to re-assess the bill of entry at declared value with consequential relief on the ground that an assessee cannot be precluded from challenging the enhancement by way of appeal, even if he has accepted the enhancement.

The Commissioner (Appeals), by resorting to Section 14(1) of the Customs Act, 1962, read with Rule 3 of the Customs Valuation Rules, 2007, came to the conclusion that the assessing officer had not followed the said rules and various decisions on this issue before rejecting the declared value and subsequently enhancing the declared value.

The respondent-assessee contended that these appeals are not maintainable in view of the directions, instructions, and circulars issued by the Ministry or Board prohibiting the filing of appeals below the stipulated monetary threshold limit of Rs. 50 lakhs. The CBIC's instructions dated November 2, 2023, are binding on the department because the said instructions have been issued under Section 131BA of the Customs Act, 1962. Section 131BA of the Act empowers the Board to issue instructions fixing monetary limits for the purpose of regulating the filing of appeals.

The assessee contended that the Ministry of Finance clearly stated in its instructions dated November 2, 2023, that it does not want to pursue any litigation before the CESTAT where an appeal involves duty of less than 50 lakhs. The delegatee or agent of the Ministry of Finance cannot seek to file an appeal in defiance of and contrary to the instructions of its master, i.e., the Ministry of Finance.

The appeals filed by the department are not maintainable in view of the instructions dated November 2, 2023, issued by the Board, and consequently, we dismiss all 26 appeals, leaving the question of law, if any, open.

Counsel For Appellant: Pawan Kumar

Counsel For Respondent: R.K. Hasija

Case Title: Commissioner of Customs ICD Patparganj & Other ICDs Versus VSM Impex Pvt. Ltd.

Case No.: Customs Appeal No. 60711 of 2023

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