DELTA POWER SOLUTIONS PVT LTD Vs. COMMISSIONER OF CUSTOMS OFFICE OF THE COMMISSIONER OF CUSTOMS CHENNAI

JUDGEMENT

(1.) THE petitioner has sought for an issuance of a writ of certiorarified mandamus to quash the order of the second respondent dated 17.6.2009 and to direct the second respondent to refund the EDD of Rs.1,95,275/- along with interest from 6.6.2008.

(2.) THE petitioner herein engaged in the manufacture of Power Rectifier System. THE petitioner company imports goods from its Parent company. THE import transactions of the petitioner company from 'related persons' namely from parent company and group companies were examined under Section 14 of the Customs Act, 1962 read with Customs Valuation (Determination of Value of Export Goods) Rules, 2007 by the Special Valuation Branch (SVB) of the Customs Department at New Delhi. Dealing with the import from related persons under Circular No.11/01 dated 23.2.2001, the Central Board of Excise and Customs instructed that the SVB (Special Value Branch) shall hold enquiry wherever there is a prima facie justification for conducting the enquiry in case of imports where the transaction is between related persons in accordance with Rule 2(2) of the Valuation Rules, 1988. Further the EDD collected at 1% shall be increased to 5% wherever there is a delay in the reply by the importer till the date of receipt of reply by the Department. THE investigation and finalisation of the provisional assessment made must be completed within four weeks from the date of reply. If no decision is taken within four months, the EDD should be discontinued and the concerned Deputy Commissioner/Assistant Commissioner shall be held responsible for the delay in finalisation of the provisional assessment of the petitioner as per Circular No,268/07. THE Assistant Commissioner of Customs, SVB held that pending verification of the agreements between the supplier and the importer and the books of account, their imports from the suppliers, Delta Electronics, Thailand, are ordered to be assessed provisionally with EDD at 1% on the assessable value of the goods in addition to the duty payable by them in accordance with Circular No.11/01. After examining the transactions, the Assistant Commissioner of Customs, Special Valuation Branch, passed an order on 6.6.2008 accepting the value quoted by the petitioner as transaction value in terms of Rule 3(3)(b)(i) of the Valuation Rules that all pending assessments be finalised. THE copy of the order was sent to the second respondent. In respect of certain bills of entry dated 13th December 2007, 12th February 2008, 27th February 2008 and 17th March 2008, the respondents collected 1% EDD. In terms of circular dated 23.2.2001 in Circular No. 11/2001, the petitioner entertained the impression that considering the collection of EDD, the assessment was by way of provisional assessment. When the petitioner took steps to claim the refund of 1% EDD paid under the imports from related persons pursuant to the order passed on 6.6.2008, the petitioner was informed by the respondents vide letter dated 17.6.2009 that the assessment was treated as final. In the circumstances, the petitioner represented on 22nd May 2009 before the second respondent to treat these bills as provisionally assessed since they had paid 1% EDD for the four bills of entry dated 13.12.2007, 12.2.2008, 27.2.2008 and 17.3.2008. THE second respondent, however, rejected the said plea in his order dated 17.6.2009 on the ground that the said bills of entry were more than six months old. Aggrieved by the said view of the second respondent, the petitioner has come before this Court. THE respondents have filed their counter affidavit.

(3.) HEARD learned counsel for the petitioner and the learned counsel for the respondents.