CESTAT Upholds Order in Favor of Assessee for Failure of dept in Submitting Date of Communication

Commissioner of Customs Vs Usah International Ltd (CESTAT Chennai)

This case between the Commissioner of Customs and Usah International Ltd, was heard by the CESTAT Chennai. The Department appealed against the order passed by the Commissioner (Appeals) on the grounds of limitation.

Analysis: The article analyzes the arguments put forth by the Department and Usah International Ltd. The Department contended that the date of communication of the Order-in-Original should have been considered for computing the period of limitation, whereas the Commissioner (Appeals) computed it from the date of passing the Order-in-Original. However, the Commissioner (Appeals) noted that the Department had failed to provide the details of the date on which the Order-in-Original was received by the reviewing authority.

The article also refers to a similar matter that came before the Tribunal, where the Tribunal dismissed the appeal after considering the absence of evidence regarding the date of receipt of the Order-in-Original by the reviewing authority. The Department in the present case also failed to establish why they had not furnished the date of communication of the order before the Commissioner (Appeals). Furthermore, refund amount in dispute has already been settled by payment made by Usah International Ltd along with interest.

Conclusion: Based on the analysis of the arguments and considering the absence of evidence regarding the date of receipt of the Order-in-Original, the CESTAT Chennai upheld the order in favor of Usha International Ltd. Appeal was dismissed on grounds of limitation and on merits as the refund amount had already been settled.

FULL TEXT OF THE CESTAT CHENNAI ORDER 

1. The above appeal is filed by the Department against the order passed by the Commissioner (Appeals) who dismissed the appeal filed by the Department on the ground of limitation.

2. The learned AR Shri R. Rajaraman explained the facts of the case. It is submitted that against the order of sanctioning the refund of SAD paid by the respondents, the Department had filed appeal before the Commissioner (Appeals). This appeal was rejected observing that there is a delay in passing the review order by the reviewing authority. It is submitted that the date of communication of the Order-in-Original ought to have been taken by the Commissioner (Appeals) for computing the period of limitation of three months whereas, the Commissioner (Appeals) computed the limitation from the date of passing the Order-in-Original. He prayed that the appeal may be allowed.

3. The learned counsel Shri Rohan appearing for the respondent submitted that even on merits the appeal does not survive for the reason that against the order passed by the original authority sanctioning the refund, the Department had issued Show Cause Notice proposing to recover the erroneously granted refund. The appellant then filed an application before the Settlement Commission for settling the issue of payment of the differential duty of SAD along with interest. The Settlement Commission initially rejected the said request of the appellant. Against this, the appellant moved the Hon’ble High Court and the matter was remanded to the Settlement Commission. Thereafter, the request for settlement was allowed and the appellant paid the refund amount along with interest. Therefore, the amount sanctioned as refund has already been repaid to the Government. For this reason the matter has become infructuous and the appeal does not survive on merits also.

4. Heard both sides.

5. The learned AR has submitted that the Commissioner (Appeals) has erroneously dismissed the appeal as time barred. Similar matter had come up before the Tribunal wherein the Commissioner (Appeals) had taken the date of passing the Order-in-Original for computing the period of limitation. In the present case, in para 5 & 6 of the impugned order the Commissioner (Appeals) has discussed in detail that even after repeated requests the Department had not provided the details of the date on which the Order-in-Original was received by the reviewing authority. In similar matter, vide Final Order No.40203-40205/2023 dated 27.03.2023 the Tribunal had considered such appeal and dismissed after making the following observations.

“11. We do not understand what prevented the Department from submitting before the Commissioner (Appeals) that the Order-in-Original was received by the Review Cell on the respective dates on which they have stated in the grounds of appeal. As there is no evidence to substantiate the contention of the Department that the Order-in-Original was received on such dates by the Review Cell and as there is no reason to dis-believe the findings of the Commissioner (Appeals) that there was no evidence as to the date on which Order-in-Original was received by the Reviewing Authority, the strong inference that can be drawn is that there is a delay in passing the review orders in these appeals.

12. As discussed we cannot accept the contention of the Department that the orders were received by the Reviewing Authority only on 10.02.2010/16.04.2010/14.07.2010. We find no grounds to interfere with the observation and findings of the Commissioner (Appeals).”

6. The Department has not been able to establish why they had not furnished the date of communication of order before the Commissioner (Appeals). We therefore find no grounds to take a different view in this case. We also take note that the refund amount which is in dispute in this appeal has already been settled by making payment on the side of the appellant along with interest. Therefore on merits also nothing survives. We hold that the appeal is without any merit and dismissed accordingly.

(Order dictated in the open court)