The Central Board of Excise & Customs (“the CBEC”) has issued Instruction F. No. 201/01/2014-CX.6 dated June 26, 2014 (“the Instruction”) for all the Commissioners to follow judicial discipline in the matters relating to refund.
The CBEC has invited attention to the order of the Hon’ble High Court of Gujarat (“the HC”) in the case of E.I. Dupont India Pvt. Ltd. [2013-TIOL-1172-HC-AHM-CX]. In this case, E.I. Dupont had filed an appeal before the HC against rejection of a refund claim on an issue which had earlier been decided by the HC against the Revenue, though in a matter relating to a different assessee. Thus for deciding the refund, a binding precedent judgment existed. However, the binding precedent was not followed, which led to litigation before the HC to which it took a serious view.
The CBEC noted that on the subject of refund, where the Department has gone in appeal, a Circular No. 695/11/2003-CX dated February 24, 2003 (“the Circular”) already existed in this regard and had the Circular been followed in the instant case, unnecessary litigation as well as adverse observation of the HC could have been avoided.
Therefore, the CBEC has directed the adjudicating authorities to peruse the judgment of the HC in the case of E.I. Dupont India Pvt. Ltd. (supra) for complete understanding of the issues involved and directions of the HC to follow judicial discipline. Further, the officers have also been directed to peruse the judgement of the Hon’ble Supreme Court in Union of India Vs. Kamlakshi Finance Corporation Ltd. [2002-TIOL-484-SC-CX-LB] which is an authoritative pronouncement on the issue and which has also been cited by the HC.
Moreover, the CBEC wants the Commissioners to bring the contents of the Instruction to the notice of all adjudicating authorities under their jurisdiction with directions to follow the same scrupulously.
Let’s hope for the best for granting refund to the assessee.
(Bimal Jain, FCA, FCS, LLB, B.Com (Hons), Mobile: +91 9810604563, Email: email@example.com)