TMI Blog2015 (11) TMI 1232X X X X Extracts X X X X X X X X Extracts X X X X ..... ated in Section 27 of the Customs Act. Aggrieved by the same, when appeal was preferred, the appellate authority vide order dated 04.11.2009, confirmed the order passed by the Deputy Commissioner of Customs, by repeating the same reasons. Therefore, such reasons assigned by the original authority and appellate authority in their orders, in my view, are totally running contrary to the ratio laid down by Hon'ble Apex Court [1994 (2) TMI 57 - SUPREME COURT OF INDIA] and this Court. - it is crystal clear that the the bank guarantee cannot be regarded as equivalent to payment of duty and it is only furnished to safeguard the interest of the revenue in case of non fulfilment of export obligation. - Impugned order is set aside - Decided in favour of assessee. - W.P.No.15669 of 2014 - - - Dated:- 22-7-2015 - MR. T.RAJA, J For the Petitioner : Mr.P.J.Rishikesh For the Respondent : Mr.V.Sundareswaran, Standing Counsel ORDER It is the claim of the petitioner that the petitioner Company, being 100% export oriented unit, had imported 6 auto striper knitting machines for a sum of ₹ 51,48,414/- under the Export Promotion Capital Goods (EPCG) Scheme, which has been not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , to release the original bank guarantee in their custody. Thereupon, the said original bank guarantee was released by the Customs department with the 'cancelled endorsement' much later by its letter dated 22.03.2007. On receipt of original bank guarantee, though the petitioner had made an application for refund of duty on 10.04.2007 for return of the enforced sum of ₹ 4,07,245/, that has been paid by the petitioner's bankers M/s.Indusind Bank on 05.01.2001, the Deputy Commissioner of Customs, without providing an opportunity of personal hearing to the petitioner, dismissed the appeal in his Order-in-Original No.304/2007 DC (Acc), dated 20.08.2007 stating that the refund application has been filed beyond the limited period of six months as stipulated in Section 27 of the Customs Act. As against that, though the petitioner filed an appeal before the respondent on 09.10.2007, they did not get any information from the respondent, therefore, the petitioner was constrained to file an application under the RTI Act to know the status of his appeal pending before the respondent. Thereafter, the RTI department of the Customs House, vide its letter dated 21.05.2014, replied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner. It is further submitted that the agreed amount of target by the petitioner was not achieved by them in the second block year , hence, a sum of ₹ 4,07,245/- was encashed on 10.01.2001 in terms of the condition of the contract. It is further stated that although the petitioner obtained Export Obligation Discharge Certificate (EODC) and the same was submitted on 26.05.2003, pursuant to the filing of EODC, the petitioner sought for refund of encashed bank guarantee, therefore, it was rejected by the authority in the light of Section 27 of the Customs Act, hence, he sought for no interference to the order passed by the respondent. 5. Again, placing on reliance on the judgment of this Court in the case of Commissioner of Customs and another v. M/s.Areva T D India Limited (passed in W.A.No.299 of 2013, dated 21.04.2014), it is submitted that when the Statute does not empower the authorities to collect the interest on the delayed payment of Central Excise Duty, the petitioner cannot be clothed with the liability of interest on the ground that they have asked for instalments for payment of Central Excise Duty, therefore, he pleaded, the question of awarding interest on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the petitioner towards export obligation, which is over and above the sum stipulated as per the licence. Therefore, when the Export Obligation Discharge Certificate has been rightly issued by the DGFT, the petitioner, vide his letter dated 28.05.2003, requested the Commissioner of Customs, chennai, to release the original bank guarantee, however, the Deputy Commissioner of Customs has wrongly rejected, vide his order dated 20.08.2007, stating that the refund application has been filed beyond the limitation period of six months as stipulated in Section 27 of the Customs Act. Aggrieved by the same, when appeal was preferred, the appellate authority vide order dated 04.11.2009, confirmed the order passed by the Deputy Commissioner of Customs, by repeating the same reasons. Therefore, such reasons assigned by the original authority and appellate authority in their orders, in my view, are totally running contrary to the ratio laid down by Hon'ble Apex Court and this Court. 8. In this regard, it is more appropriate to refer to a judgment of the Hon'ble Apex Court in the case of Oswal Agro Mills Limited (cited supra). Relevant portion of the said judgment is extracted hereun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ked and the amount was credited to the Customs Treasury on 1.4.2004. The first respondent produced the Export Obligation discharge certificate obtained from the Director General of Foreign Trade on 16.4.2004, based on which the appellant duly cancelled the bond and the Bank guarantee during the month of August 2004. When the department accepted the fulfillment of export obligation and the export obligation discharge certificate issued by the Director General of Foreign Trade, there is no need either to invoke the bank guarantee or retain the amount, which has already been credited in the department account on invocation of the bank guarantee and the technical plea that the refund of the amount cannot be granted as the claim made is barred by limitation under Section 27(1)(b) of the Customs Act also cannot be legally sustainable. The furnishing of bank guarantee in order to fulfill the export obligation cannot be regarded as payment of duty which the first respondent is liable to pay. From the above said judgments, it is crystal clear that the the bank guarantee cannot be regarded as equivalent to payment of duty and it is only furnished to safeguard the interest of the reve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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