Case Law Details
Commissioner of Customs Vs K.V. Paints & Chemicals Co. (CESTAT Chennai)
Introduction: The case of Commissioner of Customs Vs K.V. Paints & Chemicals Co. is an important one that sets a precedent for the treatment of tax proceedings against deceased individuals. The Central Excise and Service Tax Appellate Tribunal (CESTAT) examined the validity and implications of continuing tax proceedings initiated against a person posthumously.
Analysis: The appeal, filed by the Commissioner of Customs Seaport, Chennai, was against an order that rejected the departmental appeal concerning the sanction of SAD Refund to the Respondent, K.V. Paints & Chemicals Co. The company had filed for a refund claim of 4% Additional Duty of Customs, and it was sanctioned by the refund sanctioning authority.
However, during the hearing on 25.05.2023, it was revealed that the sole proprietor of K.V. Paints & Chemicals Co., Mr. Kishan Chand Ohri, had died on 22.08.2019. Rule 22 of Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 states that any proceeding will be abated on the death unless an application has been made for continuation of such proceedings within sixty days of the occurrence of the event, which was not the case here.
Conclusion: Relying on the judgement of the Hon’ble Supreme Court in the case of Shabina Abraham & Ors. Vs. Collector of Central Excise & Customs, the CESTAT held that no proceedings can be initiated or continued against a dead person as it is a violation of natural justice. This case underscores the necessity to observe the law in letter and spirit, particularly in tax proceedings, and sets a precedent for future similar instances.
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