Case Law Details
Bio Gen Extracts Pvt Ltd Vs Commissioner of Customs (CESTAT Bangalore)
We find that the appellant initially exported Phycocyanin and a part quantity of the same was rejected for quality reasons which was re-imported by him without payment of duty in terms of Notification No. 158/95-Cus dated 14.11.1995 on executing Bond with Bank Guarantee. We also find that the appellant have re-exported the said goods after rectifying the defect and the identification of the re-exported goods is not disputed by the Department. Further, we find that the appellant also paid an amount of Rs.13,81,543/- as demanded by the Department. Further, we find that after payment of the duty along with interest, the appellant sought suitable amendment to the re-exported shipping documents to enable the appellant to claim drawback in terms of Section 74 but the same was not considered and his request was rejected without affording him an opportunity of hearing which is in violation of the principles of natural justice. We also find that it is substantive right of the exporter to claim drawback and it has been consistently held by various High Courts that substantive right should not be denied on account of procedural irregularities. Further, we find that CBEC issued Circular No. 1063/2/2018-CX dated 16.02.2018 whereby they have compiled orders of Hon’ble Supreme Court High Courts and CESTAT which have been accepted by the Department on which no review petitions have been filed by the Department. We further note that at SI. No. 2 of this Circular, the Department has accepted the judgment of the Hon’ble High Court in the case of CCE Vs Dashiyon Ltd. reported in 2016 (41) STR 884 and the judgment of Hon’ble High Court of Rajasthan in the case of CCE Jaipur Vs National Engineering Industries Ltd. reported in 2016 (42) STR 945.
Further, as per Para 2.1 of the Circular “Department has accepted the judgment whereby the Hon’ble High Courts dismissed the Department’s Appeal inter alia holding that substantive benefits cannot be denies because of procedural irregularities. Further, we find that the judgments relied upon by the appellant cited supra have admitted that free shipping bills can be converted into drawback shipping bills subject to certain conditions. Therefore, keeping in view the various decisions and the Circular issued by the CBEC dated 16.02.2018, we set aside the Communication dated 12.03.2019 and remand the matter back to the Commissioner to consider the claim of the appellant for conversion of free shipping bills into drawback shipping bills, after following the principles of natural justice and after affording an opportunity of hearing to the appellant.
FULL TEXT OF THE CESTAT ORDER
The present appeal is directed against the impugned order dated 12.03.2019 whereby the Department has rejected the request of the appellant to convert free shipping bills into drawback shipping bills on the ground of non-fulfillment of conditions of Notification No. 158/95 dated 14.11.1995.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
