Law envisages that pre-deposit has to be made and this mandate cannot be wished away
THE appellant is an importer of alcoholic beverages from their related foreign suppliers. The Customs officer held that the value of the goods should be enhanced on the basis of the contemporaneous value of identical goods (imported by independent buyers) in terms of Rule 4 of the Valuation Rules, 2007 and directed that all pending provisional assessment be finalised accordingly.
The appellant preferred an appeal and the Commissioner(A) concluded that while taking the value of the identical goods, consideration should be given to the difference in commercial levels and quantities and accordingly, directed the adjudicating authority to re-determine the value by taking into account the above factors.
This order was challenged by the appellant before the CESTAT.
It is submitted that since there is no quantification of duty liability the appellant is not required to make any pre-deposit and the appeal should be heard without insisting on any pre-deposit. Reliance is placed on the Bombay High Court decision passed in case of Rochem Separation Systems (I) Pvt. Ltd. [WP no. 581 of 2013]
The AR submitted that the quantification of duty is yet to be done and, therefore, the appeal is premature. Moreover, in view of the amended provisions of section 129E of the Customs Act, 1962, the appellant is required to make a pre-deposit of 10% of the duty in pursuance of the appellate Commissioner's order but since the same is not yet computed the appeal is not maintainable.
The Bench observed that the appeal was filed in the Registry on 27th August, 2014 and the new provisions of section 129E of the Customs Act, 1962 came into force with effect from 06/08/2014.
After reproducing the contents of substituted section 129E, the Bench observed -
++ As per the amended provisions, the appellant is required to deposit 10% of the duty, in case where duty or duty and penalty are in dispute or penalty where such penalty is in dispute, in pursuance of the decision or order appealed against. The meaning of the expression "in pursuance" is "that which follows" or "in consequent upon a thing", "a consequence". Therefore, if as a consequence of the order, duty liability arises pre-deposit of 10% of the duty liability has to be made before an appeal against the order can be considered.
++ In pursuance of the order of the appellate authority dated 03/06/2014, the value has to be re-determined taking into account the difference in the commercial levels between imports made by the appellant and identical imports made by others. On account of such re-determination, there may be liability to pay additional duty which has not been quantified and discharged. It is not the case of the appellant that in pursuance of the above order there would not be any differential duty liability.
++ From a plain reading of the amended Section 129E of the Customs Act, 1962 to consider an appeal at the second appellate stage against an order of the lower appellate authority, 10% of the duty or penalty arising in pursuance thereof has to be pre-deposited. In other words, the law envisages that the pre-deposit has to be made. This mandate of law cannot be wished away.
++ As regards the reliance placed on the Bombay High Court decision, the said decision was rendered before the amendment was made to section 129E and, therefore, the said decision may not have any relevance or application in the context of amended provisions of law.
++ Therefore, the applicant is directed to approach the adjudicating authority for re-quantification of the duty liability in terms of the lower appellate authority's order and if they are still aggrieved, to come before this Tribunal, after making pre-deposit of the difference of duty so determined.
The appeal was disposed of in the above terms.