Case Law Details
Presidency Exports & Industries Limited Vs Commissioner of Customs (CESTAT Kolkata)
Introduction: This article examines a crucial order by CESTAT Kolkata in the case of Presidency Exports & Industries Limited vs. Commissioner of Customs. The dispute revolves around the rejection of refund claims based on shipping bill assessments. The appellant challenges the rejection, citing discrepancies in the assessment process and the absence of a final order under Section 17 (5) of the Customs Act, 1962.
Detailed Analysis: The appellant filed three refund claims, arguing that export duty was incorrectly charged based on Wet Metric Tonne (WMT) instead of Dry Metric Tonne (DMT), as per the contract value. The Adjudicating Authority demanded export duty without providing reasons, and the appellant’s request for a speaking order under Section 17 (5) of the Customs Act went unanswered.
The authorities rejected the refund claims, asserting that the shipping bills had undergone final assessment, and no appeal was filed. The appellant, challenging this decision, argued that without a speaking order under Section 17 (5), the assessment remains inconclusive, making the refund claims maintainable.
CESTAT Kolkata reviewed the case and highlighted Section 17 (4) and (5) of the Customs Act. It noted that, as per the Act, the Adjudicating Authority should pass a speaking order on reassessment within 15 days. However, in this instance, no such order was issued. Therefore, CESTAT Kolkata ruled that the reassessment of shipping bills was not final, rendering the denial of refund unsustainable.
The order instructs the adjudicating authority/proper officer to pass a speaking order under Section 17 (5) of the Act. Only after this process, if any refund claim is maintainable, should it be decided in accordance with the law.
Conclusion: The CESTAT Kolkata’s decision brings clarity to the assessment of shipping bills and its implications on refund claims. By emphasizing the necessity of a speaking order under Section 17 (5) of the Customs Act, the order underscores the importance of a conclusive reassessment process. This ruling serves as a valuable precedent for businesses navigating refund claims related to export duties and highlights the procedural significance of Section 17 in Customs Act cases.
FULL TEXT OF THE CESTAT KOLKATA ORDER
The appellant is in appeal against the impugned order challenging rejection of the refund claim filed by the appellant.
2. The facts of the case are that the appellant filed three refund claims on the ground that the export duty was charged on the basis of Wet Metric Tonne (WMT), whereas the contract value was on Dry Metric Tonne (DMT). The appellant requested the assessing officer to pass a speaking order under Section 17 (5) of the Customs Act, 1962, but the Adjudicating Authority did not pass any order under Section 17 (5) of the Customs Act, 1962. But the appellant filed refund claims of excess duty paid by them.
2.1 The refund claims were rejected by the authorities below on the ground that the shipping bills involved were assessed finally and no appeal was filed by the appellant against the same. Therefore, the assessment has become final and the refund claims were not maintainable.
2.2 Against the said order of rejection of refund claims, the appellant filed an appeal before the ld. Commissioner (Appeals), who also rejected their refund claims.
2.3 Being aggrieved with the said order, the appellant is before us.
3. The ld. Counsel for the appellant submits that at the time of filing of the shipping bills by the appellant, the Adjudicating Authority passed an order of demanding export duty from the appellant on the basis of WMT instead of DMT, without assigning any reason and in terms of Section 17 (5) of the Customs Act, 1962, no speaking order was passed within 15 In that circumstances, assessment done by the Adjudicating Authority is not final and realizing by the appellant, they have paid excess export duty, they filed refund claim, which was rejected by the authorities below. As the assessment of the shipping bills have become final and which has not been challenged, therefore, the refund claim is not maintainable. It is his submission that as no speaking order has been passed in this matter, in that circumstances, the assessment is not final. Therefore, the refund claim is maintainable.
4. On the other hand, the A.R. for the Revenue, supported the impugned order.
5. Heard both the parties and considered the submissions.
6. In this case, we find that it is a fact on record that the appellant filed shipping bills at the time of export of goods and duty was to be paid on the basis of DMT instead of WMT. The Adjudicating Authority without assigning any reason, demanded duty on the basis of WMT in terms of Section 17 (4) of the Customs Act, 1962. As per the said provisions, where on verification or otherwise, it is found that the self- assessment is not done correctly, the proper officer may, without prejudice to any other action, which may be taken under this Act, re- assess the duty leviable on such goods. Further, Section 17 (5) of the Customs Act, 1962, mandates that if any order passed by the proper officer under Section 17 (4) of the Act, he shall pass a speaking order on the re-assessment within 15 days from the date of reassessment of shipping bill.
7. For better appreciation, the Section 17 (4) & Section 17 (5) of the Customs Act, 1962, are reproduced below :
“17 (4) Where it is found on verification, examination or testing of the goods or otherwise that the self-assessment is not done correctly, the proper officer may, without prejudice to any other action which may be taken under this Act, re-assess the duty leviable on such goods.
17 (5) Where any re-assessment done under sub-section (4) is contrary to the self-assessment done by the importer or exporter [ * * * ] and in cases other than those where the importer or exporter, as the case may be, confirms his acceptance of the said re-assessment in writing, the proper officer shall pass a speaking order on the re-assessment, within fifteen days from the date of re-assessment of the bill of entry or the shipping bill, as the case may be.”
8. On going through the above provisions, we find that in this case, the assessments of shipping bills have been done under Section 17 (4) of the Act and further Section 17 (5) mandates that if any order is passed under Section 17 (4) of the Act, the proper officer is duty bound to pass a speaking order of re-assessment within 15 days of the order passed under Section 17 (4) of the Act.
9. Admittedly, in the case in hand, no order under Section 17 (5) of the Act has been passed.
10. In that circumstances, we hold that the re-assessment of shipping bill is not final. Therefore, the appellant has no reason to challenge the assessment of the shipping bills. In that circumstances, the reasons for denying the refund to the appellant are not sustainable.
11. Therefore, we set aside the impugned order and direct the adjudicating authority/proper officer to pass a speaking order under Section 17 (5) of the Act and thereafter, if any refund claim is maintainable, the same is be decided in accordance with law.
12. In these terms, appeal is disposed off by way of remand.
(Operative part of the order was pronounced in the open court)
Author Bio
