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2016 (10) TMI 566 - SUPREME COURT

2016 (10) TMI 566 - SUPREME COURT - 2016 (340) E.L.T. 97 (SC) - Recovery of Duty drawback - non receipt of export proceeds - demand of duty with interest - jurisdiction of Assistant Collector of Customs - Rule 16A of the Duty Drawback Rules 1995 - Section 75 of Customs Act, 1962 - whether Rule 16A of the Duty Drawback Rules 1995 had retrospective effect and the drawback before 06.12.1995 can be recovered? - Held that: - Suffice is to point out that the effect of Section 75 of the Customs Act, 19 .....

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tive effect - drawback to be recovered. - Decided against the appellant. - On drawback of excise duty, the refund was granted along with 12% Simple Interest, though the said amount is refunded but the interest component has not been released to the appellant till date. If that be so, then the amount of interest shall be released in favour of the appellants within three months. - Civil Appeal No. 255/2008 with C.A. No. 569/2008 and C.A. No. 570/2008 - Dated:- 29-7-2016 - A.K. SIKRI AND ROHIN .....

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onal and is carrying on the business of manufacture and export of readymade garments. During the period 1991-1993, the appellant exported garments to M/s. Pinky Originals Inc. and M/s. Indo American Design Workshop Inc., USA, valued at ₹ 45.75 crores, in respect of which the appellant was allowed duty drawback. However, the appellant was not able to realise export proceeds to the extent of ₹ 11.73 crores since the foreign buyers were declared bankrupt. Consequently, the appellant app .....

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ly replied. 4. After receiving the reply of the appellant, the Assistant Commissioner of Customs by an order dated 01.07.1998 confirmed the demand of ₹ 99,69,684/- towards principal, along with interest at the rate of 24% per annum amounting to ₹ 71,73,851, aggregating to ₹ 1,71,37,545/-. It is not in dispute that the interest component has been worked out at 24% per annum for a three-year period between 26.05.1995 and 26.05.1998. 5. The said order dated 01.07.1998 was challeng .....

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ue before the Appellate Authority. 6. Pursuant to order dated 07.08.1998, the appellant raised the said plea before the Appellate Authority. Before the Appellate Authority, the appellant raised the issue that Rule 16A of the Duty Drawback Rules 1995 was not retrospective. The appeal was dismissed vide order dated 21.09.1998 and the contention of the appellant that Rule 16A of the Duty Drawback Rules 1995 was not retrospective was rejected. It was further held that Rule 16A has to be harmoniously .....

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posed of vide order dated 11.06.1999 relying upon the decisions of this Court in the case of 'Cannanore Spinning & Weaving Mills Ltd. v. Collector of Customs and Central Excise' [AIR 1970 SC 1950] and 'Amba Lal v. Union of India' [AIR 1961 SC 264]. It was held that Rule 16A of the Duty Drawback Rules 1995 could not be retrospective and that all payments made towards the Central Excise component of drawback before 06.12.1995 cannot be recovered even though the export proceeds .....

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on 30.05.2003 seeking refund. 11. On 16.06.2003, the Assistant Commissioner of Customs (Refund) rejected the claim for refund of the drawback recovered from the appellant to the extent of its customs component of ₹ 46,06,890/-. The appellant's claim for interest at 24% on the entire amount of the drawback recovered from the appellant was also rejected. 12. Being aggrieved, the appellant filed writ petition challenging the order dated 16.06.2003. The High Court vide its impugned judgmen .....

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him. It was observed by the High Court that prior to the Duty Drawback Rules, 1995, there was no provision either in the Central Excise Act, 1944 or in the Duty Drawback Rules, 1971 which stipulated that if the export proceeds were not recovered, then the corresponding excise duty drawback would become refundable by the exporter. 13. Section 37 of the Central Excise Act, 1944 is a general provision encapsulating the rule making power of the Central Government and nothing more. Rule 14 of the Dut .....

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944, Rule 16A could obviously not be made retrospective to apply even to those exports, like those in the instant case, which were made prior to 06.12.1995. Therefore, in this respect, the High Court was in complete agreement with the order dated 11.06.1999 passed by the Central Government in the appellant's revision petition. The said order has attained finality with the dismissal of the Civil Appeal filed by the Government. It was further held that the order dated 12.06.2003 passed by the .....

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