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2016 (1) TMI 958 - GUJARAT HIGH COURT

2016 (1) TMI 958 - GUJARAT HIGH COURT - TMI - Refund claim - SEZ unit - Additional Commissioner, Customs, Surat returned the refund application of the petitioner on the ground that he has no authority to decide the same. - In the process of removal of its drugs, the petitioner had paid customs duty of ₹ 25,18,342/ as applicable. However, owing to delay in supply of drugs, order was cancelled by the DTA buyer. On account of such development, the petitioner filed a request before the SEZ aut .....

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- Dated:- 20-1-2016 - MR. AKIL KURESHI AND MR. MOHINDER PAL, JJ. FOR THE PETITONER : MR ANAND NAINAWATI, ADVOCATE FOR THE RESPONDENT : MR PRANAV G DESAI, ADVOCATE, MR RJ OZA, ADVOCATE ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. The petitioner has challenged a communication dated 23.7.2015 as at AnnexureA to the petition under which Additional Commissioner, Customs, Surat returned the refund application of the petitioner on the ground that he has no authority to decide the same. 2. .....

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f ₹ 25,18,342/became refundable. The petitioner therefore, filed refund application which came to be returned by the Additional Commissioner, Customs, Surat, on the ground of authority of jurisdiction. In the said order he conveyed as under : Please refer to your refund application dated 29.04.2015 and subsequent letter dated 04.04.2015 on above subject matter. 2. In this respect, it is to inform you that that in case of a SEZ unit, the assessment in made by specified under the SEZ Act. In .....

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at Kandla and adjudicated by Commissioner of Customs, Kandla. 3. In view of the above, your refund claim application is returned herewith. 3. Under the similar circumstances, in a writ petition being Special Civil Application No.20321/2015 decided today, we had directed the Customs authority to entertain and decide the refund application of the petitioner therein. We may reproduce the entire order which reads as under : 1. Petitioner is aggrieved by the respondents not deciding its refund appli .....

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countervailing duty, though it was not payable by the petitioner. The petitioner, therefore, made a refund claim before the concerned customs authority having jurisdiction over the unit. 2.2 The issue regarding who would be the correct authority to process refund claims with respect to units situated in SEZs has been brewing up since quite some time. The respondents authorities are unable to decide such applications on account of certain intradepartmental communications. The situation had come t .....

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er the Commissioner of Customs nor the Commissioner of SEZ are left in a position to decide the refund claims of SEZ units or in some cases buyers of the goods. We would advert to the legal position shortly. However, we must observe that the Government cannot bring about a situation where no authority is left with the power to decide refund applications of the importers. This situation was brought about by the Ministry in its letter dated 1.11.2012. In the letter, as we have noted, while noticin .....

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turned to the applicants with a advise to approach the Department of Commerce. It was further conveyed that if any appeal was pending, same may also be returned for approaching the Department of Commerce. 14. Two things immediately emerge from this letter. Firstly, that the Ministry of Finance also recognised that there was no mechanism under the SEZ Act and Rules framed thereunder for entertaining refund applications and secondly, that the Ministry was of the opinion that such a set up was requ .....

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y a mere communication to stop the Commissioner of Customs from processing refund claims which was his statutory duty. Secondly, if such mechanism was to be changed for SEZ units from the authorities of the Customs Commissionerate to Commissionerate(SEZ), there had to be matching provisions providing such mechanism under the SEZ law. This admittedly was not done. In fact, till date it has not been done. Thirdly, all the refund claims, appeals and reviews were to returned with an advise to approa .....

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Excise Act. They can be taken away by statutory amendments. The powers can be shifted into another authority if a valid law is made in order to do so. By a mere letter, Ministry of Finance could not have suspended the power of Commissioner(Customs) to exercise his statutory functions. It is undisputed that duty was collected by the Commissioner of Customs. Whatever be the character of the duty, the Commissioner of Customs collected the same on a perceived opinion that unit concerned was required .....

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e question of unjust enrichment. Many issues may arise which are not clear to us. But one thing is clear that such issues can be decided only by the authority under the Customs Act. 16. Section 27 of the Customs Act, 1962 pertains to claim for refund of duty. Subsection( 1) thereof provides for an application to be made by person claiming duty or interest in prescribed form to the prescribed authority within the prescribed time. Subsection(2) of section 27 authorises the Assistant Commissioner o .....

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l Excise Act and held that any claim for refund would be covered by section 27 of the Customs Act or 11B of the Excise Act as the case may be. It was observed as under: (i) Where a refund of tax/duty is claimed on the ground that it has been collected from the petitioner/plaintiff whether before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991 or thereafterby misinterpreting or misapplying the provisions of the Central Excises and Salt Act, 1944 read with Central Ex .....

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226and of this Court under Article 32 cannot be circumscribed by the provisions of the said enactments, they will certainly have due regard to the legislative intent evidenced by the provisions of the said Acts and would exercise their jurisdiction consistent with the provisions of the Act. The writ petition will be considered and disposed of in the light of and in accordance with the provisions of Section 11B. This is for the reason that the power under Article 226 has to be exercised to effec .....

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s duty, redemption fine or penalties as the case may be, adjudicated and collected by the Customs authority under the Customs Act, 1962, even with respect to units situated in SEZ areas. Whatever refund claims being returned to the petitioners by the Customs Commissionerate, the petitioners would represent the same to the appropriate authority. If the petitioners do so latest by 15.12.2014, all such applications shall relate back to the first presentation before the Customs authority. The period .....

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t on clearance from SEZ unit to DTA. Such duty was collected by Range Dahej, Commissionerate SuratI (as per Copy of TR6 challan submitted). Further, the administrative control /revenue collection from your unit is with Central Excise & Customs, Bharuch Commissionerate. It is evident that Ahmedabad Customs Commissionerate does not have jurisdiction over your unit. The order of Hon'ble High Court in case of M/s.Anita Exports may be applicable to those Customs Commissionerates who are havin .....

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th. 3. In our opinion, for multiple reasons, the approach of the Assistant Commissioner was incorrect. Firstly, in Anita Exports, there were bunch of petitions not having identical facts. It was only for convenience that we had referred to detailed facts in case of Anita Exports. Further, we do not see any material difference so far as the facts of Anita Exports and present case are concerned. The ratio of the decision was that for any customs duty collected, refund application would be maintain .....

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