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2019 (9) TMI 970 - HC - CustomsRecovery of erroneous Duty Drawback - Rule 16 of the Drawback Rules, 1995 - rejection of value declared in the shipping bills after completion of export - self assessment - extended period of limitation - power to reject already assessed value of goods which stand exported. Whether writ petition under Article 226 is maintainable against impugned show cause notice dated 9.2.2018? - HELD THAT:- All the questions raised by Petitioner are question of jurisdiction, we find it appropriate to entertain present writ Petition under article 226 of the Constitution of India and accordingly proceed to answer other questions. Whether demand of duty drawback under Rule 16 of the Drawback Rules, 1995 can be made without any reasonable period of limitation? - HELD THAT:- Notice has been issued under Rule 16 and not 16A of Drawback Rules, 1995 so it is admitted fact that foreign currency stands realized thus in the absence of laying down some period as reasonable period, there would never be conclusion of assessment and it would be at the whims and fancies of Respondent to open any assessment at any point of time. Under Customs Act, 1962 every consignment passes through scrutiny of team of Customs officers and there may be mistake on the part of customs officers in one or two cases but cannot be so in every shipping bill - Period of 5 years for all purposes is reasonable period so we hold that any notice issued under Rule 16 of Drawback Rules, 1995 beyond 5 years from the date of export is bad in the eyes of law and barred by limitation - decided in favor of petitioner. Whether re-enacted Drawback Rules, 2017 w.e.f. 1.10.2017 save Show Cause Notice dated 9.2.2018 (Annexure P-9) issued under Rule 16 of repealed Drawback Rules, 1995? - HELD THAT:- By inserting Rule 20(2) government has shown its different intention and Rule 20(2) of Drawback Rules, 2017 does not save show cause notices relating to demand of already paid duty drawback, therefore, Respondent cannot initiate or continue with show cause notice (P-9) issued under Rule 16 of erstwhile Drawback Rules, 1995. Whether Rule 16 of Drawback Rules, 1995 provides complete machinery to declare already paid drawback as erroneous or excess and thus recovery thereof? - HELD THAT:- Rule 16 of Drawback Rules, 1995 requires to pay drawback which has been availed erroneously or in excess of entitlement. The Rule does not prescribe mechanism to determine and demand any drawback as erroneous or in excess of entitlement - Rule 16 of Drawback Rules, 1995 does not have machinery to hold and demand any drawback as erroneous or excess and in the absence of mechanism demand is bad in the eye of law. Whether Respondent/customs department under Rule 6 & 8 of Valuation Rules, 2007 read with Section 14 of the Customs Act, 1962 has power to reject already assessed value of goods which stand exported? - HELD THAT:- Rule 16A provides for demand in case of non-realisation of export proceeds. Realisation of export proceeds is sine qua non to avail drawback and in case of non-realisation demand is raised under Rule 16A of the Rules. There was no need to insert Rule 16A if Rule 16 covers demand of erroneous and excess drawback in all cases - the mechanism is absent under Customs Act, 1962 read with Drawback Rules to hold any drawback as erroneous or excess and demand thereof. Petition allowed.
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