TMI Blog2023 (12) TMI 695X X X X Extracts X X X X X X X X Extracts X X X X ..... entitlement of the Firm claiming payment of Drawback cannot be considered by the learned CESTAT, but the Revenue s demand for recovery of the erroneously paid Duty Drawback, can be considered by learned CESTAT. This would lead to a situation where if the Drawback is not fully sanctioned by the Revenue, and the Revenue later claims the refund of the partly paid Drawback, the assessee resisting the Revenue s claim for recovery of the part Drawback would have to appeal before the learned CESTAT, but claim payment of the remaining part of the Drawback before another authority. There is merit in the contention that the Revenue s appeal is grossly delayed. However, the principal controversy sought to be raised is regarding the jurisdiction of the learned CESTAT to entertain the Firm s appeal. Although, Revenue had not filed an appeal against the order dated 02.11.2018 within the stipulated time, the concerned authority has taken the steps for reviewing the consequential steps taken pursuant to the said order which is impugned in the said appeal. The issue whether the said order is valid is also sought to be raised in defence to the relief sought by the Firm in the present writ petition. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... delay in filing and re-filing the said appeal. 5. The controversy in the above-captioned matters relates to the refund of a sum of ₹54,80,710/- comprising of ₹26,15,942/- being the duty drawback availed by the Firm plus ₹28,64,768/- as interest, which was deposited by the Firm pursuant to a communication dated 12.03.2014. The Firm had prevailed before the learned CESTAT and accordingly, the refund was sanctioned. The Revenue claims that the same was done erroneously as the learned CESTAT had no jurisdiction to entertain any appeal relating to Duty Drawback. According to the Revenue, the order passed by the learned CESTAT is non est and therefore, the sums refunded to the Firm are required to be recovered. FACTUAL CONTEXT 6. The Firm is engaged in the business of exporting imitation jewellery, handicrafts, etc. It operates a 100% Export Oriented Unit (hereafter EOU ). 7. The controversy in the present matters relates to the Drawback of Rs. 26,15,942 claimed by the Firm, during the period from 2007-08 to 2013-14, on the basis of various shipping bills. 1st Demand regarding the Drawback 8. A letter dated 12.03.2014 was sent by the Deputy Commissioner (Export) to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribes the penalty for attempt to improperly export goods making them liable for confiscation under Section 113 of the Customs Act). 12. The learned Joint Commissioner of Customs, Air Cargo Export Commissionerate rejected the Firm s claim for Drawback and confirmed the demand in the SCN dated 24.08.2015 vide an order dated 31.01.2017. The learned Commissioner directed appropriation of the amount of Rs. 54,80,710/- that had been voluntarily deposited by the Firm along with interest. Finding that the goods in question were liable for confiscation as they were exported by the Firm under the Duty Drawback Scheme, which was not available to them, the learned Commissioner also ordered confiscation of the goods of the declared FOB Value of Rs. 14,95,39,702/- under Section 113(h)(ii) of the Customs Act read with Section 11 of the Foreign Trade (Development Regulation) Act, 1992 and Rules 11 and 14(2) of the Foreign Trade (Regulation) Rules, 1993. Penalty of Rs. 15,00,000/- was also imposed upon the Firm under Section 114(iii) of the Customs Act. The Firm was also given an option to redeem the confiscated goods on payment of a Redemption Fine of Rs. 50,00,000/-. 13. On appeal by the Fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... back 18. On 15.07.2020, the impugned SCN was issued to the Firm regarding the availed Drawback stating that the learned CESTAT had no jurisdiction to decide any appeal in respect of any order passed by Commissioner (Appeals) relating to payment of Drawback, and the Drawback was erroneously refunded to the Firm and was required to be paid. 19. On 14.07.2020, the Commissioner (Customs), exercising power under Section 129D(2) of the Customs Act directed the Deputy Commissioner (Drawback) to appeal the refund order dated 10.02.2020 before the Commissioner (Appeals) on the ground that the learned CESTAT had no jurisdiction to pass an order, which had led to issuance of the said refund order. 20. Subsequently, on 06.07.2021, the impugned notice, was issued to the Firm, under Section 128A(3) of the Customs Act. By the said impugned notice, the Firm was called upon to show cause as to why the refund order dated 10.02.2020 should not be reviewed. 21. This Court, by order dated 06.08.2021, had granted an interim stay of the impugned SCN and the impugned notice, noting that the refund order dated 10.02.2020 arose out of CESTAT order dated 02.11.2018 and the Revenue had not filed any appeal ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o amount could have been appropriated suo motu as the demand itself was time barred. 31. The learned counsel submitted that the decision of learned CESTAT was accepted as mentioned in the impugned notice, and the Revenue had sanctioned the refund amount of Rs. 54,72,2014/- along with issuing a refund order on 10.02.2020 in compliance of the order dated 02.11.2018. 32. The learned counsel objected to any leniency being shown to the Revenue as its challenge to the order passed by CESTAT is hopelessly time barred and the reasons given by the Revenue did not show sufficient cause as required under Section 130(2)(A) of the Customs Act. 33. He submitted that despite allegedly misplacing the files, the Revenue kept on harassing the Firm by issuing the impugned SCN and the impugned notice under Section 128A(3) of the Customs Act. 34. The learned counsel contended that the learned CESTAT had jurisdiction to entertain the matter as a competent appellate authority and pass the order dated 02.11.2018 since the Firm had filed an appeal (against order dated 14.05.2018) mainly on the question of the penalty imposed and limitation. 35. The learned counsel also argued that even if the learned CESTA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntention that the learned CESTAT committed a grave jurisdictional error in deciding the appeal of the Firm as even though the appeal had been filed for annulment of penalty, etc., but the matter predominantly pertained to Drawback. He submitted that thus the impugned order is non est in the eyes of law. 43. He submitted that even though the Revenue did not object to the jurisdiction of learned CESTAT, it ought not to have exercised its jurisdiction over the present matter especially in view of the bar contained in Section 129A(1) of the Customs Act. 44. The learned counsel submitted that the impugned order appears to have been passed in haste as the same has been passed without taking into account all the facts and circumstances of the case. ANALYSIS 45. The present writ petition essentially challenges the impugned notices issued by the Revenue, demanding the drawback and interest, which had been released to it pursuant to the order dated 02.11.2018 passed by the learned CESTAT. 46. Since it is contended by the Revenue that the appeal before the learned CESTAT was not maintainable, and the amount was wrongly refunded to the Firm, the first and foremost issue to be decided in the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeal is in relation to recovery of Drawback that has already been sanctioned. He further submitted that the jurisdiction of the learned CESTAT is excluded only if the dispute relates to payment of drawback. 51. He relies upon the judgment passed by the CESTAT, West Zonal Bench, Ahmedabad, in the case of Ravi Technoforge Pvt. Ltd. and Ors. v. C.C.-Kandla and Ors: 2022 SCC OnLine CESTAT 794. In the said case, the learned CESTAT had held that payment and recovery are two separate funds and what has been barred by Section 129A, is the issue relating to the payment of drawback. It is thus contended that since the issue, in the present case, relates to recovery of the Drawback already sanctioned, the appeal would be maintainable. 52. We are not persuaded by the contentions advanced on behalf of the Firm. We also do not agree with the view taken by the learned CESTAT, West Zonal Bench, Ahmedabad in Ravi Technoforge Pvt. Ltd. and Ors. v. C.C.-Kandla and Ors. (supra). 53. Chapter X of the Customs Act not only deals with the eligibility as to Drawback but also contains the provision for its recovery in case the Drawback has been paid erroneously. In our view, even though proviso (c) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the only relief being claimed was in regard to the imposition of penalty. The entire SCN dated 24.08.2015 could not have been set aside. 59. It is also contended by the learned counsel for the Firm that no objection as to the jurisdiction of the Tribunal, was ever taken by the Revenue before the learned CESTAT. 60. He submitted that the Revenue had agreed to the jurisdiction of the learned CESTAT to entertain the appeal and in fact, had sanctioned refund of the amount of Drawback pursuant to the order passed by the learned CESTAT. He further submitted that the appeal challenging the order of the learned CESTAT has been filed belatedly only to overcome the argument that the Revenue, by its consent, had agreed to the jurisdiction of the learned CESTAT. 61. We do not agree with the said contention advanced on behalf of the Firm. It is settled law that competence of the Court to try a case goes to the very root of the jurisdiction. The inherent lack of jurisdiction makes the order passed by the Court void in law. There is also no inherent right to file an appeal and the same is granted by the statute. In the absence of any such right, the learned CESTAT being a creature of statute, di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rties and the only objection is whether, in the circumstances of the case, the court ought to exercise jurisdiction, the parties may agree to give jurisdiction in their particular case; or a defendant by entering an appearance without protest, or by taking steps in the proceedings, may waive his right to object to the court taking cognizance of the proceedings. No appearance or answer, however, can give jurisdiction to a limited court, nor can a private individual impose on a judge the jurisdiction or duty to adjudicate on a matter. A statute limiting the jurisdiction of a court may contain provisions enabling the parties to extend the jurisdiction by consent. 32. In Bahrein Petroleum Co. [(1966) 1 SCR 461 : AIR 1966 SC 634] this Court also held that neither consent nor waiver nor acquiescence can confer jurisdiction upon a court, otherwise incompetent to try the suit. It is well settled and needs no authority that where a court takes upon itself to exercise a jurisdiction it does not possess, its decision amounts to nothing . A decree passed by a court having no jurisdiction is non est and its invalidity can be set up whenever it is sought to be enforced as a foundation for a righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the consequential steps taken pursuant to the said order which is impugned in the said appeal. The issue whether the said order is valid is also sought to be raised in defence to the relief sought by the Firm in the present writ petition. In view of above, this Court considers it apposite to condone the delay in filing the appeal. 69. We are of the opinion that the appeal preferred by the Firm before the learned CESTAT was not maintainable and the order passed by the Tribunal is thus void ab initio. 70. Coming back to the prayers sought in the writ petition, that is, challenge to the impugned SCN and the impugned notice issued under Section 128A(3), the impugned SCN was issued noting that the refund order dated 10.02.2020 was issued erroneously since the same was issued consequent to the order passed by the learned CESTAT, which had no jurisdiction to entertain the appeal. 71. Having observed above that the order passed by the learned CESTAT is void and non est, any refund granted pursuant to such non est order, in our opinion, was rightly demanded by the Revenue. 72. Even though it is not mentioned as to under which provisions the said SCN was issued, the Revenue, in terms of Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but merely set aside the SCN dated 24.08.2015 which was issued invoking the extended period of limitation which was not available. 76. The other issue, which is raised by the Firm, is that the initial SCN dated 24.08.2015, which held the Firm ineligible for the Drawback, was issued belatedly, and was thus time barred. 77. The learned counsel for the Firm contended that the Drawback in the present case relates to the years 2008 to 2014, and therefore, any demand in the year 2015, would be hit by limitation. 78. He relies upon the following judgments: Pratibha Syntex v. Union of India: 2012 SCC OnLine Guj 6147; Padmini Exports v. Union of India: 2012 SCC OnLine Guj 6191; State of Punjab Ors v. Bhatinda District Coop. Milk P. Union Ltd.: 2007 SCC Online SC 1254; Collector of Central Excise, Jaipur v. Raghuvar (India) Ltd.: (2000) 5 SCC 299; and Govt. of India v. Citadel Fine Pharmaceuticals: (1989) 3 (SCC) 483. 79. On the other hand, the learned counsel for the Revenue contended that no period of limitation is prescribed under Rule 16 of the Drawback Rules, and the demand was made within a reasonable period from when the Revenue came to know of the fact that the Firm had wrongly avail ..... X X X X Extracts X X X X X X X X Extracts X X X X
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