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Valuation Rules and PSI Obligations

Citizen cannot be taxed whimsically

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08th-Jun-2019       
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High Court Division :
(Special Statutory Jurisdiction)
Borhanuddin J
Sardar Md Rashed Jahangir J
Saiful Alam (Md)…………..Appellant
                   VS
Customs, Excise and VAT Appellate
Tribunal, Dhaka, and others………… Respondents    
Judgment
November 14th, 2018
Customs Act (IV of 1969)
Section 25A
The importer under the PSI scheme has no obligation to prove authenticity of the actual transaction value when PSI agency certified the price under Section 25A of the Act. The authority should be refrained from assessing the PSI certified goods on pick and choose basis at the whims of assessing officials rather it is incumbent upon the authority to strictly follow the valuation rules and PSI rules if it is proved with sufficient and authentic evidence that the PSI certified price is not the actual transaction value. . ..... (23)
Munshi Moniruzzaman, Advocate-For the Appellant.
Pratikar Chakma. DAG-For the Respondent No. 2.
Judgment
Borhanuddin J : This appeal is directed against the judgment and order dated 5-5-2013 passed by the Customs Excise & VAT Appellate Tribunal, Dhaka, respondent No. 1 herein.
2. Brief facts are that the appellant as an importer opened Letter of Credit No. 1616-1001-0233 dated 2-9-2010 for importation of 15469 kg "Laptop Bag" from China at the rate of US$ 0.75 per piece under the Pre-shipment, Inspection (PSI) scheme. Before shipment, Government nominated PSI agency after inspecting the goods issued clean report of findings (CRF) dated 22-11-2010 certifying, amongst others, price of the goods at US$ 2.86 per piece. After arrival of the goods, the appellant through his C & F agent submitted Bill of Entry No. C-160578 dated 6-12-2010 for releasing the goods on payment of duties and taxes as per CRF particulars. But the Customs Authority assessed the goods fixing US$ 2.86 per piece ignoring PSI certified price. Under compelling circumstances, the importer released the goods paying duties and taxes in cash on the CRF value and furnished a Bank Guarantee for the difference of duties and taxes between CRF value and value fixed by the Customs Authority. After releasing the goods, the appellant under rule 23 of the PSI Rules filed review application before the Review Committee. Upon hearing the stakeholders and perusing relevant papers/ documents, the Review Committee directed the Customs Authority to assess the goods on the basis of CRF value by its order dated 8-3-2011.
3. Being aggrieved, the respondent No. 2 Commissioner of Customs, Customs House, the Chittagong, filed appeal before the Customs, Excise and VAT Appellate Tribunal.
4. Upon hearing the parties and perusing papers/documents, Tribunal set aside the order passed by the Review Committee and thus confirmed assessment of the Customs Authority vide judgment and order dated 5-5-2013, which is impugned herein.
5. Having aggrieved by and dissatisfied with the judgment and order, the importer as appellant preferred instant Customs Appeal under section 196D of the Customs Act, 1969.
6. Mr. Munshi Moniruzzaman, learned advocate appearing for the appellant submits that the appellant imported the goods under the PSI scheme and Government nominated PSI agency issued CRF certificate under Section 25A of the Customs Act certifying quality, quantity, price, description and classification of the goods but Customs Authority assessed the goods arbitrarily without following provisions of law as such impugned judgment and order is liable to be set aside. He also submits that Review Committee upon hearing the concern parties and perusing papers/documents and considering previous reference value of the identical goods directed the Customs Authority to assess on the basis of CRF certified price but the Tribunal without controverting findings of the review committee passed the impugned judgment and order which is liable to be set aside. By referring valuation report as contained in the paper book learned advocate submits that commercial description of the goods as described in the CRF certificate is 'laptop bag,' Nylon, Assorted size 832.92 dozen and price of the identical goods as shown in valuation report is US$ 0.73 per piece close to invoice value at the rate of US$ 0.75 per piece and Government nominated PSI agency after inspecting the goods certified price at the rate of US$ 1.30 per piece but the Tribunal without applying its judicial mind passed the impugned judgment and order ignoring the valuation report supplied by the Customs Authority and findings of the review committee as such impugned judgment and order is liable to be set aside. To substantiate his argument learned advocate refers Rule 5 and 9 of the Pre-shipment inspection (PSI) Rules.
7. On the other hand, Mr. Pratikar Chakma learned Deputy Attorney-General appearing for the respondent No. 2 submits that from the valuation report as contained in the paper book it appears that price of the laptop bag is US$ 2.86 per piece and thus Customs Authority assessed the goods at the value found in data base which is confirmed by the Tribunal as such there is nothing to interfere with the impugned judgment and order. He also submits that finding of the review committee is not based on the observation of the committee as such Tribunal passed the impugned judgment and order after perusing price of the identical goods during contemporary period. Learned Deputy Attorney-General further submits that Rule 22(3) of the PSI Rules empowers the customs authority to determine price of the goods as such Tribunal justly and legally passed the impugned judgment and  order.
8. Heard learned advocate for the appellant and learned Deputy Attorney-General for the respondent No.2. Perused the paper book and relevant papers/documents contained therein.
9. It appears that invoice value of the imported goods is US$ 0.75 per piece and the PSI agency certified the price at US$ 1.20 per piece but the Customs Authority determined price of the goods at US$ 2.86 per piece. It may be mentioned here that PSI agency is nominated by the Government. The importer has no choice/option to appoint another PSI agency other than the one nominated by the Government. Section 25A of the Customs Act' provides that the quality, quantity, price, description and classification certified by the PSI agency shall be the basis for assessment. In the case underhand, Government nominated PSI agency Bureau Veritas certified, amongst other, price of the imported goods.
10. We have gone through the judgment and order passed by the review committee and the Tribunal. On perusal of the order passed by the Review Committee, it appears that in arriving its finding review committee considered contemporary reference value of the identical goods. Relevant portion of the order is quoted herein under:
” পিএসআই সং¯'া তাঁর প্রত্যায়িত মূল্যের স্বপক্ষে রেফারেন্স পিআরএফ দাখিল করেন । তাতে দেখা যায়, পূর্বে কাষ্টমস হাউস কর্ত"পক্ষ একই পণ্য সিআরএফ প্রত্যায়িত মূল্যে শুল্কায়ন করেছেন । যার রেফারেন্স নং বিভি ১০৩১ এ ৯৪৯ তারিখ ২৯-১০-২০১০ইং বিডিএইচ ২০১০ ২২৬৫০ ১সি তারিখ ঃ ১৩-৭-২০১০ইং।”                                                                                                       
 (To be continued)

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