Skylark Office Machines Vs Commissioner of Customs (Port) (CESTAT Kolkata)
Introduction: A recent case before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Kolkata, involving Skylark Office Machines, brings to light an important issue related to customs duty demand. The appellant, in this case, had initially been granted a refund of Special Additional Duty (SAD) paid by them based on a Chartered Accountant’s (CA) certificate, as per Notification No. 102/2007. However, it was later discovered that the CA certificate used for the refund was not authentic. Consequently, recovery proceedings were initiated against the appellant. This article delves into the details of the case, the implications, and the CESTAT’s directive for re-adjudication.
Detailed Analysis:
1. Background: Skylark Office Machines applied for a refund of SAD under Notification No. 102/2007. The refund was initially granted, relying on a Chartered Accountant’s Certificate provided by the appellant. However, it came to light that the CA certificate was not authentic.
2. Recovery Proceedings: Subsequently, recovery proceedings were initiated against Skylark Office Machines. Following due process, the demands for recovery were confirmed. In response to this, the appellant has approached CESTAT Kolkata.
3. Appellant’s Argument: The appellant’s consultant argued that the submission of a Chartered Accountant’s Certificate was not a mandatory requirement and was not specified as a condition precedent under Notification No. 102/2007. It was highlighted that a CBEC Circular (Circular No. 06/2008-CUS) from 2008 directed importers to submit copies of such certificates. In this particular case, the appellant entrusted a third party to obtain the CA certificate and was unaware that the issuing Chartered Accountant had passed away. This lack of awareness was emphasized to establish the absence of any malintent in the use of the certificate. The appellant also presented a fresh Chartered Accountant’s Certificate dated October 6, 2023, for consideration.
4. Revenue’s Response: The revenue’s representative reiterated the findings of the lower authorities.
5. CESTAT’s Decision: Upon reviewing the case and the documents presented, CESTAT Kolkata found no proof of any ulterior motive or fraudulent intent on the part of the appellant concerning the earlier certificate. In light of this, and considering the fresh Chartered Accountant’s Certificate dated October 6, 2023, CESTAT directed that the matter be remanded to the adjudicating authority.
6. Re-Adjudication: The adjudicating authority was instructed to verify the veracity of the certificate and assess the validity of all related documents. If the certificate was found to be in order, the adjudicating authority was to issue a necessary order approving the appellant’s refund claim. This directive implied that if the refund claim was deemed eligible, the confirmed demand against the appellant, along with interest and penalty, would be set aside.
Conclusion: The case of Skylark Office Machines vs. Commissioner of Customs (Port) highlights the significance of the accuracy and authenticity of documents in customs-related matters. It underscores the importance of providing genuine and valid certificates when seeking refunds or exemptions. The decision of CESTAT Kolkata to remand the case for re-adjudication, taking into account the new Chartered Accountant’s Certificate, reflects a fair approach to address situations where the authenticity of documents is in question. This case serves as a reminder of the need for due diligence and transparency in customs-related processes to avoid potential issues and penalties.
FULL TEXT OF THE CESTAT KOLKATA ORDER
The appellant was allowed refund of SAD paid by them in terms of Notification No.102/2007. While granting refund claim, the department relied on the Chartered Accountant’s Certificate produced by the appellant. Subsequently, it was found that the certificate issued by the Chartered Accountant was not authentic. Accordingly, recovery proceedings were initiated. After due process, the demands were confirmed. Being aggrieved, the appellant is before the Tribunal.
2. The Ld. Consultant for the appellant submits that production of Chartered Accountant Certificate is not mandatory and has not been made as a condition precedent under the Notification No.102/2007-CUS dated 14.09.2007. On account of CBEC Circular No.06/2008-CUS dated 28.04.2008, the importers were directed to submit copies of the Chartered Accountant’s Certificate. In this case, the importer trusted the third party to arrange for the Chartered Accountant’s Certificate and did not know that the concerned Chartered Accountant had expired. Therefore, the Ld. Consultant submits that they had no mala fide role in submitting the Chartered Accountant’s Certificate in question. He produces a copy of the fresh Chartered Accountant’s Certificate dated 17.08.2017. The details of his Membership has been verified and certified on 06.10.2023. The Ld. Consultant requests that the matter may be remanded to the adjudicating authority for considering this fresh Chartered Accountant’s certificate. He also relied on the decision of this Tribunal in the case of Joy International vs. Commissioner of Customs (Port), Kolkata vide Final Order NO.77055/2019 dated 17.12.2019, wherein on identical issue, the matter was remanded to the adjudicating authority.
3. The Ld.AR for the revenue reiterates the findings of the lower authorities.
4. Heard both sides and perused the documents produced before us.
5. On perusal of records, we find that no ulterior motive of the appellant towards production of the earlier certificate has been proved. They have produced a fresh Chartered Accountant’s Certificate dated 06.10.2023. Therefore, following the ratio of the cited case law, we remand the matter to the adjudicating authority.
6. He is directed to check the veracity of the Certificate and if all other related documents are found to be in order, pass a necessary order allowing the refund claim filed by the appellant. If the refund is held as eligible, the present confirmed demand against the appellant along with interest and penalty would get set aside.
Appeal stands disposed of.
(Dictated and pronounced in the open Court.)
