At the very outset, I am very confident to say that Indian exporters can beat the international competition hollow but further compelled to say that the Indian bureaucracy is single handedly enough to pull down the Indian exporters & for that reason alone, the growth engine of exports & consequently the GDP suffers. On the other hand, I am very surprised that why the bureaucracy is not willing to accept their job & responsibility in the right perspective. Why the officials are not even able to understand that their job is not to write the law like a double meaning dialogue to con the beneficiaries in the name of interpretation. The readers will note that if the exporters do not get their legitimate entitlements then the bureaucracy is squarely responsible & should be deservedly punished for the lapses rather then be allowed to climb the ladder & raise the inefficiency in the system. If any of the promotion scheme fails in the private sector, then the executive responsible for that is kicked out & not kicked up in the organization but when will the Indian bureaucracy learn this simple principle is difficult to comprehend.
This is the story of claim of interest in case of delayed refunds in terms of Rebate under the old excise regime. Like the delay in the settlement of the claims, the cases are still pending for decisions. The readers will note that the government read CBEC provided itself 90 days for the processing & grant of refunds & even that could not be complied with. This was shameful & disgusting but no one in the system at any point of time felt ashamed about it. On the contrary, this was a badge of honour because the officials felt all powerful for being able to withhold the legitimate refunds illegally & neither the system nor the exporter could take them to task. I think, the policymakers were never able to understand this poor joke (their job is not to withhold the claims & harass but to facilitate refunds based on actual exports having taken place) otherwise the Commissioner/Chief Commissioner would have made life miserable for the culprits. I made it a point to recover interest in respect of the delayed refunds whether they were in respect of Drawback, Rebate or any other. You had to put up with stiff resistance & frivolous litigation before you could get your dues all because of the cheats in the system. The worst part is that these cheats expected respect but then I had always to say I have more respect for the shoeshine boy who sits at the Andheri Station, who does his job meticulously & collects his dues.
In a batch of Rebate cases, the Asstt. Commissioner & subsequently the Commissioner (Appeals) rejected the interest demand despite the exporter having pointed out that the issue is finally settled by the Supreme Court & there is a circular issued by the CBEC, which is binding on the department & needs to be complied with. However, as the readers may be aware, the field formations are all powerful & there is absolutely no fear of insubordination because the CBEC prefers a shut eye in such illegalities therefore the CBEC is trampled routinely. The Commissioner (Appeals) took the position that the rebate sanctioning authority did not grant interest because claim was settled within 90 days or interest was not granted as an error. Further, the Commissioner (Appeals) concluded that if the interest was not paid then the appeal should have been filed to claim interest & cited the GoI order in case of M/s. Reliance Industries Ltd. The manifestations of crooked mind to deny the legitimate interest to the exporter is clearly visible because if the common sense was used, the right course of action is to ascertain the date of filing the claim & the date of settlement of the claim & in case of the delay, interest is a liability of the department, which cannot be avoided because there is no free lunch in this world.
The exporter then approached the Principal Commissioner & Ex officio Addl. Secretary to GOI to get justice in the matter & pointed out that the CBEC has issued circular No. 670/61/2002-CX dated 1-10-2002, which contains the following:
2. In this connection, Board would like to stress that the provisions of section 11BB of Central Excise Act, 1944 are attracted automatically for any refund sanctioned beyond a period of three months. The jurisdictional Central Excise Officers are not required to wait for instructions from any superior officers or to look for instructions in the orders of higher appellate authority for grant of interest.
However, the Principal Commissioner & Ex officio Addl. Secretary to GOI failed to grant justice despite the CBEC circular being clear that the interest is attracted automatically & no appeal is required to be filed. The readers will note that this con game will never be acceptable even to a person with little common sense. The CBEC says that no appeal is required to be filed for the claim of interest (because the date of filing the claim & the actual date of settlement should appear in the order pertaining to the rebate claim) whereas the the Principal Commissioner & Ex officio Addl. Secretary to GOI is not willing to comply with it. Such idiocy can never be acceptable simply because it is self-evident. The impunity lies in the fact that the official does not even consider it fit to specify that why the CBEC circular is not being complied with! How can then the beneficiaries ever have faith in the written word of the law or the government of the day when even such blatant violations are carried out without any fear?
Further, the appellant categorically brought to the notice of the Principal Commissioner & Ex officio Addl. Secretary to GOI the following:
” The learned Commissioner (Appeals) states in the impugned order that he is bound by the RA, GOI Order No. 604/12-CX dtd. 25.5.12 of in case of Reliance Industries Ltd. vs. CCE LTU to deny the interest as if the order of the Supreme court in case of M/s. Ranbaxy Laboratories Ltd. Vs. Union of India & Ors. In Civil Appeal No. 6823 of 2010 is of no consequence. Please see Annexure 2. The copy of the order of the Apex court is attached for ready reference. The SC has categorically ruled that interest after the stipulated period is payable up to the date of payment. The departmental officials will agree that as per the hierarchy followed in this country, the order of the Supreme Court settles the law finally & needs to be followed or distinguished if not found unacceptable. In the earlier case cited herein, the learned Commissioner (Appeals) (Order in appeal No. BC/587/RGD(R)/2012-13 dtd.13.2.13) has thus relied on this apex court decision to permit interest payment. Therefore, binding precedent arising out of the decision of the apex court in case of M/s. Ranbaxy should be followed simply based on judicial discipline because judicial discipline is of significant importance. Please see the order in original, it is crystal clear that the delay in settlement of Rebate claims beyond 90 days from the date of submission is clearly visible & accepted by the original authority.”
It is crystal clear that the issue stands finally settled by the Apex court that interest is payable beyond 90 days in case of refund cases therefore the decision of the RA, GOI is of no consequence & cannot be applied.
The Indian bureaucracy has not denied interest in respect of rebate but also in case of Duty drawback & any other refunds & doing the same thing in case of IGST refunds also shamelessly as on date. Please note, cheating is all pervasive & a systemic issue. Therefore, I am compelled to hold the CBIC responsible for stopping the malaise & cheating!
Therefore, the moot question is that why the officials at the highest level of the bureaucracy pretend to be simply ignorant of the basics of the law & don’t show any respect even for common sense or the CBEC circular. Is the Principal Commissioner & Ex officio Addl. Secretary to GOI not even able to comprehend interest payment is a question of fact & a liability to be discharged by the rebate sanctioning authority in case there is a delay beyond 90 days as per the CBEC circular & that frivolous litigation is avoidable. I was not taught cheating neither in my school nor in the college therefore I fail to understand that where did these bureaucrats learn this cunningness to cheat? Is it there in the bureaucratic because of the way, the system operates? If yes, then is it not shameful & disgusting that no one is willing or capable to act against these cheats! Until & unless this changes, there is no sustainable growth in exports possible & corrupt practices continue. This only brings the bad name to the country as a whole & tells you that ease of doing business are merely slogans & nothing beyond that! In Japan, the officials will commit hara-kiri to save their honour & in China reportedly, they may be put before a firing squad if caught in such dastardly acts, but this is India & nobody in bureaucracy cares therefore there is little hope! The blatant corrupt practices thrive unabashedly!
(Author Rajiv Gupta can be reached at firstname.lastname@example.org)
(Above are personal views of Author)