M Sea Bridge International vs CE & CGST Noida

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
ALLAHABAD

REGIONAL BENCH - COURT NO.I

Customs Appeal No.70596 of 2021

(Arising out of Order-In-Appeal No.NOI-CUSTM-000-APP-222-231-20-21, dated
18.06.2020 passed by Commissioner (Appeals) CGST & Central Excise, Noida)

M/s Sea Bridge International …..Appellant
(B-24/2641, Shop No. 2, Jagat Nagar,
Opp. King Palace, Sunder Nagar,
Ludhiana, Punjab 141008)
VERSUS
Commissioner, Customs, Noida ….Respondent
(Concor Complex . P.O. Container Depot, Gautam Budh Nagar,
Greater Noida, Uttar Pradesh 201311)

WITH
I. Customs Appeal No.70597 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);
II. Customs Appeal No.70598 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);
III. Customs Appeal No.70599 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);
IV. Customs Appeal No.70600 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);
V. Customs Appeal No.70601 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);
VI. Customs Appeal No.70602 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);
VII. Customs Appeal No.70603 of 2021 (M/s Sea Bridge
International V/s C. C. Noida);

(Arising out of Order-In-Appeal No.NOI-CUSTM-000-APP-222-231-20-21, dated
18.06.2020 passed by Commissioner (Appeals) CGST & Central Excise, Noida)


A PPEARANCE :
Written Submission filed by Shri Sagar Rohtagi, Advocate for the Appellant
Shri Abhishek Mukherjee, Authorised Representative for the Respondent


CORAM:

HON’BLE MR. P. K. CHOUDHARY, MEMBER (JUDICIAL)
HON’BLE MR. P. ANJANI KUMAR, MEMBER (TECHNICAL)

FINAL ORDER NO.70542-70549/2026

Customs Appeal No.70596 to
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DATE OF HEARING : 05.10.2026
DATE OF DECISION : 30.10.2026


P.K. CHOUDHARY:
All the 08(Eight) Appeals filed by the Appellants are
arising out of impugned common Order-In-Appeal No.NOI-CUSTM-
000-APP-222-231-20-21, dated 18.06.2020 passed by Commissioner
(Appeals) CGST & Central Excise, Noida. Hence, all the appeals are
taken up together for hearing and disposal.
2. The facts of the case in brief are that M/s Sea Bridge
International (the Appellants herein) are engaged in the business of
import of various types of goods including mixed lot of 100%
Polyester Knitted Fabrics of different weight (Mix Lot) from China.
3. The Appellants in their usual course of business entered into an
Agreement with the manufacturer for purchase of the aforesaid goods
and therefore imported the impugned goods under 08 Bills of Entry
at the mentioned price:
S. No. BOE
BOE
Declared Unit
Enhanced Unit
No.
Date
Price per KG
Price per KG
(USD)
(USD)
1. 4107638 18.07.2019 1.14 1.77
2. 4109457 18.07.2019 1.14 1.77
3. 4109459 20.07.2019 1.14 1.77
4. 4180653 23.07.2019 1.14 1.77
5. 4180765 23.07.2019 1.14 1.77
6. 4180804 23.07.2019 1.14 1.77
7. 4181637 23.07.2019 1.14 1.77
8. 4280411 30.07.2019 1.14 1.77
4. On arrival of the goods, the Appellant filed the Bills of Entry for
clearance of above said goods and submitted all the desired
documents. On examination, the goods were found as per
declarations, however, on comparison with the contemporaneous
import data, the department raised a query and the Appellants was
asked to provide complete description of the consignment like
composition of fabric, dimension, etc. That the Appellants replied to
the query and informed the description of goods to the assessing
officer, thereafter, it was alleged that the declared value by the

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Appellants was liable to be rejected under Rule 12 of the Customs
Valuation (Determination of Value of Imported Goods) Rules, 2007.
5. The issue involved is primarily as to whether the Appeals filed
by the Appellants were correctly rejected by the Commissioner
(Appeals) holding that the Appellants accepted the enhancement of
value in writing at the time of clearance of the consignments in
question?
6. The learned Counsel for the Appellants in his written
submissions submitted that the Appellate Authority has erred in not
appreciating the fact that the acceptance of enhanced value proposed
by the department by an importer does not preclude him from
challenging the enhancement by way of appeal. Even assuming that
there is an acceptance, it does not preclude him from challenging by
way of appeal as there cannot be an estoppel against law as held by
the Hon'ble Supreme Court in the case of Dunlop India Limited Vs.
UOI reported as 1983 (13) ELT 1566 (SC).
7. It is further submitted that because the manner of assessment
is arbitrary and illegal as the practice of not making the assessment
on the declared value in terms of the mandate of Section 14 of the
Customs Act, 1962, read with Rule 3 the Customs Valuation
(Determination of Price of Imported Goods) Rules, 2007, is against
the provisions of law.
8. It is also submitted that the Appellant is a regular Importer of
different kind of Fabrics and have imported 08 consignments of
fabrics from China during the period from 18.07.2019 to 30.07.2019
at ICD, Dadri against negotiated price. It has further been contended
that the Appellant had self-assessed the duty correctly as per the
respective Invoices. However, no ‘Out of Charge Orders’ were passed.
The Appellant made written requests to the Proper Officer to clear the
consignments provisionally paying duty on the enhanced value under
protest in Order to avoid delay in clearance of consignments.
According to the Appellant, no cognizance was taken by the Proper
Officer despite several written requests made for clearance of
consignment on enhanced value for which duty was paid under

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protest. Finally, the Appellant was coerced to submit letters of
consent agreeing to assessment/valuation by the Customs
Authorities. The Appellant further contended that the Customs
Authorities without observing the mandate of Section 14 of the
Customs Act, 1962, discarded the declared transaction value and
enhanced the value on the basis of the consent letter.
9. The learned Advocate submitted that since the acceptance
letters were not voluntary, the Appellant wrote several letters
requesting the learned Assessing Officer to issue Speaking Order.
However, no speaking Order was passed. Hence, the Appellant filed
respective Appeals before the Commissioner (Appeals) against the
assessment made in the respective Bills of Entry. The Appellate
Authority sought comments from the Department on the Appeals filed
by the Appellant wherein the Department contended that the re-
assessment has been done under Section 17(4) of the Customs Act,
1962 on the basis of written consent, therefore, no speaking Order
was passed. All the Appeals were rejected merely on the ground that
since the Appellant has accepted the enhancement of value in writing
there was no requirement of issuance of speaking Order under
Section 17(5) of the Customs Act, 1962 and therefore, the assessable
value determined by the Adjudicating Authority on reassessment of
imported goods in the Bills of Entry and accepted by the Appellant in
writing was legal and binding on the Appellant.
10. It is submitted that the said letter of acceptance does not
provide any evidence of contemporaneous import price of the goods
and merely mentions that the declared value is liable to be rejected
and re-determined on the basis of the data of contemporaneous
import. The Learned Advocate further submitted that merely
mentioning that the declared value is liable to be rejected and the
same is liable to be assessed at a particular price does not meet the
1
requirements of Customs Valuations Rules, 2007 , as even for
applying Rule 5 of CVR, 2007 several parameters like quantity in

1
CVR, 2007

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comparable commercial transactions, GSM, quality of goods, time of
placement of Order for import etc. has to be fulfilled.
11. The learned Advocate referring to the judgement of the Hon’ble
Supreme Court in the case of Century Metal Recycling Pvt. Ltd. vs.
UOI reported in 2019 (367) E.L.T. 3 (SC) submitted that the mandate
of Sub-Rule (2) of Rule 12 cannot be ignored or waived. Formation of
opinion regarding reasonable doubt as to the truth or accuracy of the
valuation and communication of the said ground to the importer is
mandatory. The Hon’ble Supreme Court has deprecated the practice
of bypassing and circumventing the statutory mandate as un-
acceptable. The Hon’ble Supreme Court has held that the formation
of belief and recording of reasons as to a reasonable doubt about the
truth or accuracy of the declaration is required to be substantiated by
“facts and figures” on existence of positive belief. The communication
of the reasons is the only way and manner in which the Proper Officer
in terms of Rule 12 can proceed to make assessment under Rule 4 to
9 after rejecting the transaction value as declared. The above
requirement has been made mandatory by the Hon’ble Supreme
Court by invoking the doctrine of prospective application.
12. The learned Advocate in his written submissions also submitted
that similar letters of acceptance were submitted by the importers in
the case of Hanuman Prasad & ors. and in the Appeals filed by them,
the learned Commissioner (Appeal) set aside the enhancement of
value merely on the basis of letter of acceptance. The Department
filed Appeals against the Orders of the learned Commissioner
(Appeal) wherein the Tribunal allowed the Appeals holding that once
letter of acceptance has been submitted, the importers cannot
question the assessment later on. The said importer filed Appeals
before the Hon’ble High Court of Delhi titled as Niraj Silk Mills vs.
Commissioner of Customs & Ors. - CUSAA 26/2022. The Hon’ble High
Court of Delhi after analyzing the provisions of law and judgments
allowed the Appeals. The present Appeals are squarely covered by
the judgment of the Hon’ble High Court.

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13. The learned Advocate further submitted that the mandate of
Rule 12(2) of CVR, 2007 to intimate the importer in writing the
grounds for doubting the truth of accuracy of the declared value
cannot be undermined. The Hon’ble Supreme Court in the case of
Century Metal Recycling Pvt. Ltd.(supra) has held that the said
mandate of Sub Rule (2) of Rule 12 cannot be ignored or waived.
Formation of opinion regarding reasonable doubt as to the truth or
accuracy of the valuation and communication of the said ground to
the importer is mandatory. The Supreme Court has deprecated the
act of bypassing and circumventing the statutory mandate as un-
acceptable and therefore, the proper officer was duty bound to
communicate the reasons for rejection of the transaction value in
writing as mandated by the Hon’ble Supreme Court.
14. The learned Advocate also relied on the following judgements:-

I. M/s Century Metal Recycling Ltd. Vs. Commissioner of
Customs, Faridabad. Customs Appeal No.61303 of 2019
decided vide Final Order No.60266-60349/2025 dated
27.02.2025 by CESTAT Bench at Chandigarh.
II. Commissioner of Customs, Patparganj Vs. M/s Artex
Textile Private Limited-Customs Appeal
Nos.51414,52809 and 52810 to 52864 of 2019 decided
vide Final Order No.50769-50825/2020 dated
14.09.2020 2025 by CESTAT Bench at New Delhi.
15. The learned Departmental Authorized Representative reiterated
the findings of the Commissioner (Appeals) and has drawn our
attention to the acceptance letter submitted by the Appellant
agreeing to enhancement of the declared value made in writing. The
learned Departmental Authorized Representative submitted that the
Appellant had accepted the enhancement of value in writing stating
that they have gone through the details narrated by the concerned
Officer including the grounds of rejection of declared value and
understood the details of contemporaneous import of similar/identical
goods and that they fully agree with the enhancement of value and
2
that they do not want show cause notice or speaking Order. Based

2
SCN

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on the said letter of acceptance, the Appellate Authority came to the
conclusion that the reassessment of the Appellants import
consignments were done by the Assessing Officers only after
disclosing all the ingredients of reassessment to the Appellant and
after acceptance in writing and hence no speaking Order was required
to be passed under Section 17(5) of the Customs Act, 1962. The
learned Departmental Authorized Representative relied on the
judgment of the Hon’ble High Court of Allahabad in the case of M/s
S. S. Overseas & Ors. being Writ Tax No.881/2022 and submitted
that the Hon’ble High Court has held that once acceptance of
enhancement of value by the importer is made in writing there is no
requirement of issuance of Speaking Order under Section 17(5) of the
Customs Act, 1962. The Ld. Departmental Authorized Representative
further submitted that this judgment of the Hon’ble High Court has
also been upheld by the Hon’ble Supreme Court being SLP (Civil)
No.38571/2023 titled as M/s S. S. Overseas vs. Union of India & Anr.
Hence, according to the Departmental Authorized Representative,
there is no infirmity in the Order passed by the Ld. Commissioner
(Appeals).
16. The learned Advocate for the Appellant, in rejoinder , submitted
that the issues in M/s S. S. Overseas & Ors. were entirely different in
as much as it was the case of provisional assessment and non-
issuance of Speaking Orders, while finalizing the Bills of Entry. In any
case, the Order of the Hon’ble Supreme Court was merely dismissal
of the SLP which does not operate as merger with the Order of the
High Court. In this regard, the learned Advocate relied upon the
judgment of Hon’ble Supreme Court in the case of Kunhayammed &
Ors. Vs. State of Kerala & Anr. (2000) 6 Supreme Court Cases 359.
17. Heard learned Departmental Representative for the Respondent
and perused the written submissions filed by the learned Counsel for
the Appellant and the appeal records.
18. We find that the Order of the Commissioner (Appeals) merely
proceeded on the ground that the Appellant had accepted the
enhancement of value under Section 17(5) of the Customs Act, 1962

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and therefore, there was no requirement of issuance of Speaking
Order. The Commissioner (Appeals) referred to the judgment of
Century Metal Recycling (supra) for rejecting the Appeal, more
specifically relying on Para 26 to hold that there was no general or
omnibus direction passed by the Hon’ble Supreme Court to the effect
that the transaction value declared in the bills of entry should
invariably be accepted in all cases. However, it is seen that the
Commissioner (Appeals) has failed to take into account the ratio of
the judgment in entirety. The issue as to whether assessable value
can be rejected without following the mandate of Section 14 of the
Customs Act, 1962 read with Rule 12 of CVR, 2007 and the declared
transactional value be re-determined following sequentially from Rule
4 to 5 of CVR, 2007, is no more res-integra as the Hon’ble Supreme
Court in the case of Century Metal Recycling Pvt. Ltd. vs. UOI reported
in 2019 (367) E.L.T. 3 (SC) has held that the mandate of Rule 12(2)
of CVR, 2007 to intimate the importer in writing the ground of
doubting the truth of accuracy of the declared value cannot be
ignored or waived. The Hon’ble Supreme Court has held as under:-
“20. ………………..
As per sub-rule (2) of Rule 12, the proper officer when
required must intimate to the importer in writing the grounds
for doubting the truth or accuracy of the value declared. The
said mandate of sub-rule (2) of Rule 12 cannot be ignored or
waived. Formation of opinion regarding reasonable doubt as to
the truth or accuracy of the valuation and communication of the
said grounds to the importer is mandatory, subterfuge to by-
pass and circumvent the statutory mandate is unacceptable.
Formation of belief and recording of reasons as to reasonable
doubt and communication of the reasons when required is the
only way and manner in which the proper officer in terms of
Rule 12 can proceed to make assessment under Rules 4 to 9
after rejecting the transaction value as declared.

21. The mandate to record reasons at the second stage of
enquiry is not expressly stipulated, albeit it has been read by
us by implication in Rule 12. Being conscious that this mandate
if applied to past cases would possibly lead to complications and
difficulties, we would invoke the doctrine of prospective
application with the direction that the past cases will be decided
on a case to case basis, depending upon the factual matrix and
considerations like whether the importer has asked for ‘certain

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reasons’, whether the reasons were not communicated,
whether ‘certain reasons’ can be deciphered from the
assessment/valuation Order, whether mis-description or false
declaration was apparent, etc.”
19. We find that in the Century Metal Recycling Pvt. Ltd. (supra)
facts were similar to the present case in as much as in that case too
repeated requests for provisional assessment by the importer were
ignored and the importer was forced to submit letter of acceptance.
We further find that although the letter of acceptance states that the
ground for rejection of the declared value has been narrated to the
Appellant and that details of contemporaneous import of similar and
identical goods have been shown to them and on the basis of which,
the Appellant accepted that their value were significantly lower than
the value at which identical/similar goods imported at or about the
same time in comparable commercial transactions were assessed at
other ports of the country, however, no such details of alleged
contemporaneous import data have been mentioned, therein. Given
the language as noted in some of the letters as written by the
appellant and placed above, there is a wide gap which has not been
bridged by the Revenue, in the matter. The contents of this
communication cannot therefore be taken on its face value.
20. We further find that the issue (1) as to whether the Department
can enhance the value relying on NIDB and on the basis of the
acceptance letter and (2) once there is acceptance letters, the
importer cannot contest the same, have also come up for
consideration before the Hon’ble High Court of Delhi in the case of
Niraj Silk Mills vs. Commissioner of Customs (ICD) Patparganj passed
in CUSAA 26/2022 and the Hon’ble High Court vide its judgment
dated 27.11.2024 has held that the right to question the correctness
of the decision of the proper officer, be it with respect to the formation
of opinion or even on merits, is one which is protected by statute. The
Hon’ble High Court formulated the question of law as under:-

“Whether the Tribunal misdirected itself in holding that the
appellants in the above-mentioned matter could not question
the enhancement made concerning the valuation of the

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imported goods, once the appellants had given up their right to
seek issuance of a show cause notice and/or speaking Order
under Section 17 of the Customs Act, 1962?”

The Hon’ble High Court vide its judgment, thus held as under:-

“83. That then takes us to the concession which the importer
could tender and which would require us to identify the subject
in respect of which that concession may be made. When we
examine this aspect on the anvil of Section 17(5), it becomes
apparent that the statute speaks of the concession being with
reference to the reassessment made under Section 17(4). It
thus proceeds to provide that in a case where the importer
confirms his acceptance of the reassessment in writing, the
proper officer would stand relieved of the obligation of passing
a speaking Order in respect of such reassessment. In all other
cases and where the reassessment is not acceded to, the proper
officer is obliged to pass a speaking Order. Thus, the waiver or
concession is at best confined to the speaking Order which the
proper officer is obliged to frame in affirmation of the
provisional opinion that it may have formed under Section
17(4).

84. We find ourselves unable to construe Rule 12(2) as
contemplating any concession or waiver at least in explicit
terms. All that Rule 12(2) stipulates is that the proper officer
would intimate to the importer the grounds for doubting the
declared value at its request. It is in the aforesaid context that
we would thus have to adjudge whether the CESTAT was
correct in holding that the exchange of communications
amounted to a waiver or abandonment not just of the right to
question and assail the reassessment but to impugn it in further
proceedings in accordance with the procedure prescribed under
the Act.
85. In our considered opinion, the perceived concession made
in respect of the opinion harboured by the proper officer cannot

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possibly be interpreted or construed as detracting from or
depriving the importer of the right to question the decision of
the proper officer in accordance with law. The right to question
the correctness of the decision of the proper officer, be it with
respect to the formation of opinion or even on merits, is one
which is protected by statute. The question, which as a
sequitur, arises is whether that right itself can be said to have
been abandoned.”
21. The learned Advocate has further drawn our attention to the
finding of the Hon’ble High Court on the issue as to whether the
declared value can be rejected merely on the basis of NIDB data. The
Hon’ble High Court has held as under:-

“104. It becomes apparent from a reading of these decisions
collectively that the Tribunal has consistently found that a
valuation addition based solely on NIDB data would wholly
unwarranted and that any such reassessment would have to be
shored by independent and cogent evidence. The legal position
so articulated would ensure fairness and transparency in the
determination of import values. The body of precedent noticed
above have in unison held that mere reliance on external data
without corroborative evidence or clear justification would fail
to meet the tests and principles underlying the provisions
enshrined in the 1988 Rules and 2007 Rules. They correctly lay
emphasis on the imperatives of a reasoned approach to
customs valuation and a deviation from declared values being
founded on tangible and justiciable material. A reassessment or
rejection of declared value would thus have to necessarily be
established as being compliant with the aforenoted
requirements of pre-eminence. Relieving the respondents of
this obligation would clearly lead to pernicious consequences.”

“105. Accordingly, and for all the aforesaid reasons, we would
answer the question framed in the affirmative and in favour of
the importers. The Appeals are consequently allowed and the

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impugned Orders of the CESTAT set aside. The Order of the
Commissioner (Appeals) shall in consequence stand
restored……”
22. Having considered the rival contentions and after analyzing the
relied upon judgments, we find that the issue involved in the present
Appeals is squarely covered by the judgement of Hon’ble High Court
of Delhi in the case of Niraj Silk Mills (supra) and therefore, the
impugned Orders-in-Appeal are not sustainable in law. Accordingly,
we set aside the same and allow all the Appeals, with consequential
relief if any, as per law.

(Pronounced in open court on 30.10.2026)


Sd/-
(P. K. CHOUDHARY)
MEMBER (JUDICIAL)


Sd/-
(P. ANJANI KUMAR)
MEMBER (TECHNICAL)

Nihal