TMI Blog2012 (4) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... slip or omission - The petitioner has been made to go through several proceedings, furnish NOC, etc - penalty imposed is quashed allowing a refund along with interest @ 10% per annum w.e.f. 1st January, 2008 till payment is made - respondents will pay costs of the present proceedings which are assessed at Rs.10,000/- within 2 months of order. - Writ Petition(Civil) No. 3985/2011 - - - Dated:- 7-2-2012 - Sanjiv Khanna, R.V. Easwar, JJ. K. Kumar and P.K. Mittal, Advs. for the Petitioner Sonia Sharma, Adv., Jatan Singh, Adv. for the Respondent Sanjiv Khanna, J. 1. The petitioner EMPEE Syndichem Pvt. Ltd., on 24th June,2005 had deposited Customs duty of Rs.1,52,251/- with the Commissioner of Customs, I.G. Airport, in respect of a consignment of industrial synthetic diamond powder imported from Ireland vide 5 invoices and on bill of entry No. 969856 dated 23rd June, 2005. The petitioner has placed on record the said bill of entry for home consumption in which the description of aforesaid goods stands stated and the name of the supplier/exporter was described as "Element Fix Ltd., Ireland". On 24th June, 2005, it was noticed that the goods imported did not t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it was beyond his competence to condone the delay and the letter dated 31st January, 2008, might be treated as an appealable order. 7. After receipt of this letter, the petitioner took two steps. Firstly, on 14th May 2008, a representation/application was made to the Central Board of Excise and Customs (CBEC, for short) for extension of time for re-export beyond two years under proviso to Section 74 of the Customs Act, 1962 (Act, for short) and secondly, filed an appeal before the Commissioner (Appeals) against the order dated 15th March, 2008. 8. The Commissioner (Appeals) vide his letter dated 17th December, 2008, rejected the appeal on the ground that the goods were not entered for re-export within two years from the date of payment of customs duty. The CBEC/Chief Commissioner had not extended the time. Accordingly, the claim under Section 74 of the Act was barred by time. He further held that the appeal was barred by time by 58 days as the order passed by the Assistant Commissioner was dated 31st January, 2008. It may be noticed here that vide letter dated 15th March, 2008, the petitioner was informed, for the first time, that the order dated 31st January, 2008, sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of duty paid on goods but not delivered, is not of drawback under Section 74 of the Customs Act, 1962. Reference in this regard is made to Hon'ble Tribunal decisions in the case of Tata Consulting Services vs. Collector of Customs (1990(49) ELT565 (Tribunal) and Haldia Petrochemicals Ltd. vs. Commissioner of Customs, Kolkata (2004(172)ELT411(Tri.-Kolkata). In the circumstances, when it is not a case of drawback no occasion arises for the Chief Commissioner for exercise of power under proviso to Section 74 (1) (iii) (b) of the Customs Act, 1962." (emphasis supplied) 10. Thus after about a year, the respondents Revenue completely changed their stand. Earlier, the stand was that there was delay beyond two years and, therefore, refund of duty/drawback under Section 74 cannot be granted without extension of time by CBEC/Chief Commissioner. The aforesaid stand and position was reiterated by the Commissioner of Customs (Appeals) in the order dated 17th December, 2008. However, the Chief Commissioner of Customs in his order dated 15th December, 2008, has held that Section 74 of the Act was not applicable as the goods in question were left in the custody of Customs and were never "ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to be refunded. Respondents however rely upon Section 27 of the Act and submit that the claim for refund is barred by limitation. 15. There are a number of reasons why in the present case, the said plea should not be accepted. For Section 27 of the Act to apply, it is mandatory that duty should have been paid by the petitioner in pursuance to an order of assessment. No assessment order has been placed on record. Further, where duty has been paid pursuant to an assessment order, the payer can move an application for refund of such duty and interest within the stipulated time. However, the application must be accompanied with documents and other evidence to establish that the amount of duty and interest, if any paid, was refundable. It appears that the petitioner had filed the bill of entry and deposited the custom duty on the basis of the bill of lading. However, when the goods were physically examined by the customs authorities, it was found that goods did not tally with the details mentioned on the bill of entry and it was recorded by the authorities as under:- "As per Bill of Entry and Invoices description of the goods does not tally with the goods found in the pkg. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s assumed that there was an order of assessment, the same was required to be rectified under Section 154 of the Act, once it was found that the goods mentioned in the bills of entry were different from the goods shipped. The present case would be covered under Section 154 of the Act as it is a case of errors arising out of incidental slip or omission. The respondents should not have computed the duty and passed an order without inspecting the goods and noticing that the goods were not meant for importer and were different from the goods mentioned in the bill of entry/invoice. This was apparent from the description on the package itself. The goods or the packages were never inspected by the customs authorities before 24th June, 2006. Had the goods been inspected by the custom authorities before asking the petitioner to deposit the duty, the error or mistake would not have been occurred. 18. Section 18 of the Act deals with refund of duty provisionally paid subject to final assessment. In such cases, it is the obligation and duty of the respondents to suo moto or on their own refund the duty paid provisionally subject to final assessment (See decision dated 9th January, 2012 by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere is substantial compliance of the provisions for refund, it may not be denied because it is not made strictly in the form or the prescribed manner. The forms prescribed may be merely intended to facilitate payment of refund. The tax authorities have to act judiciously when they exercise their power under an enactment. The power given to the tax authorities under the enactments are mandated with the duty to exercise them when the statutory provisions so warrant. It is imperative upon them to exercise their authority in an appropriate manner. In case the Assessing Officer or tax authority comes to know that an assessee is entitled to deduction, relief or refund on the facts of the case and the assessee has omitted to make the claim, he should draw the attention of the assessee. The tax authorities should act as facilitators and not occlude and obstruct. The role of tax authorities has been aptly described in CIT versus Rajesh Jhaveri Stock Brokers Pvt. Ltd. (2008) 14 SCC 208 as:- "19............ The function of the assessing officer is to administer the statute with solicitude for the public exchequer with an inbuilt idea of fairness to taxpayers." 21. The second contentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d NOC (was) required" signed dated 21st October, 2006. The aforesaid file notings are contrary to Circular No. 100/2003-CUS dated 28th November, 2003, which has been quoted above. In the said circular, it has been stated that a number of importers were facing difficulties because of the requirement of furnishing of the NOC from the RBI for re-shipment. Accordingly the matter was examined in consultation with the RBI who had opined that the certificate from RBI need not be insisted. The petitioner has also drawn our attention to a number of letters written by him to the RBI to furnish the NOC in view of the demand by the respondents, but there was no response. Ultimately, the Centurian Bank again intimated that no payment had been made to the Element Fix Ltd., Ireland and enclosed with the letter of RBI "denying" the NOC. Thus, the NOC was never furnished and was not required to be furnished. The contradictory stand of the respondents is apparent as after this letter, the Commissioner, IandG on 1st May, 2007, allowed re-export but imposed penalty of Rs.10,000/- for not furnishing NOC from the RBI. No reason or justification for imposition of the penalty was stated. This order was pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... original documents were not submitted and only photocopies thereof were submitted, and some documents were not even filed. These are again technical objections without any substance. Goods remained in the custody of the customs and had been inspected on 24th June, 2005. The respondent Revenue cannot contend that they were not aware of the description of the goods, the subject matter of the request for re-export, as the goods had remained in the custody of the respondents after the said inspection. With regard to non-submission of originals or documents, the petitioner could have been asked to submit the same before rejection. Nothing has been brought on record to show and establish that any request was made to the petitioner or regarding petitioner's failure to respond. 26. In view of the aforesaid discussion, we allow the writ petition and quash order dated 15th December, 2008, passed by the Chief Commissioner of Customs, Delhi Zone. The penalty imposed of Rs.10,000/- is also quashed. The respondents will refund Rs.1,49,207/- along with interest @ 10% per annum w.e.f. 1st January, 2008 till payment is made. The respondents will also pay costs of the present proceedings wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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