2009 (7) TMI 403 - AT - Customs

Refund - refund claim rejected as time-barred - there is a force in the contention of the learned JDR that the duty has been paid by the respondent voluntarily @ 20% instead of @ 7.5%. Moreover when the respondent found they have paid excess duty they asked proper officer for the amendment of the document and accordingly the same was done but by the time amendment was made the importer paid the excess duty. The importer instead of filing refund claim only preferred an appeal against the order of the re-assessment and filed refund claim after the expiry of six months from the date of payment of duty as prescribed under Section 27 of the Customs Act 1962. - Accordingly the act of the respondent does not get to cover of Section 154 of the Customs Act 1962. - In these terms the appeal filed by the Revenue is accepted and the order passed by the Commissioner (Appeals) is set aside.

Summary

Issues:
Appeal against order-in-original for refund of excess customs duty paid, application of Sections 27 and 154 of the Customs Act, 1962, time-barred refund claim, clerical error in duty payment, reliance on case laws.

Analysis:
The appeal was filed by the Revenue challenging an order setting aside the order-in-original related to the refund of excess customs duty paid by the respondent. The respondent had filed a Bill of Entry for clearance of goods, declaring duty payable at 20% instead of the correct 7.5%. The authorities accepted the declaration, but upon realizing the error, the respondent sought an amendment and refund of the excess amount paid. The Commissioner (Appeals) observed that a refund was due to the appellant, leading to a series of appeals and refund claims.

Upon examination, it was found that the original adjudicating authority rejected the refund claim as time-barred under Section 27(1)(ii)(b) of the Customs Act, 1962. The Commissioner (Appeals) held that the excess amount should have been refunded to the respondent by customs authorities 'suo motu' under Section 154 of the Act. The key contention revolved around the applicability of Sections 27 and 154 in the case, with the Revenue arguing that the refund claim was beyond the six-month limitation period specified in Section 27.

The learned JDR contended that Section 154 did not apply as it pertains to clerical or arithmetical errors, whereas the respondent voluntarily paid the duty at a higher rate. Citing relevant case laws, the JDR supported the rejection of the claim petition based on the limitation period under Section 27. On the other hand, the respondent argued that the error was a clerical one and relied on various decisions to support their position.

After thorough examination of the case laws and circumstances, it was concluded that the respondent had voluntarily paid the duty at a higher rate and failed to file a refund claim within the prescribed time limit under Section 27. As a result, the appeal filed by the Revenue was accepted, setting aside the Commissioner (Appeals) order. The cross-objection filed by the respondent was also disposed of accordingly.

In conclusion, the judgment highlighted the importance of adhering to statutory provisions regarding refund claims and the distinction between clerical errors and voluntary payments in customs duty matters.