2005 (1) TMI 581 - AT - Customs

Refund claim - Cost recovery charges for private bonded warehouse - Appeal - Appealable order

Summary

Issues:
1. Refund claim for cost recovery charges by 100% EOUs under Section 58 of the Customs Act.
2. Validity of refund claim rejection by Dy. Commissioner and subsequent appeal to the Commissioner (Appeals).
3. Interpretation of instructions relied upon by the Commissioner (Appeals) for allowing the refund.
4. Failure of respondents to pursue the appeals before the Tribunal.

Analysis:
1. The appeals were filed by the Revenue against the respondents, who are 100% EOUs, seeking a refund of cost recovery charges deposited by them for warehousing goods under Section 58 of the Customs Act. The Dy. Commissioner rejected the refund claim stating that the charges were deposited to fulfill a condition of the license for a Private Bonded Warehouse, not falling under any provisions for refund. The Commissioner (Appeals) allowed the refund based on an abstract from a book, assumed to be instructions from the Board, which the Revenue contested, citing no such official instruction. The matter was related to administrative functions, not covered under Customs Act or Central Excise Rules.

2. Despite being informed, the respondents did not participate in the appeals process. The Tribunal noted the lack of response from the respondents in pursuing the appeals, either by filing cross-objections or appearing before the Tribunal. This non-participation hindered the resolution of the issue at hand, despite the importance of the matter.

3. The Tribunal reviewed the submissions made by the Revenue, emphasizing that the refund claim for cost recovery charges did not fall under the purview of Customs Act or Central Excise Rules/Act. The Commissioner (Appeals) had based the decision on a passage from a book, not recognized as an official instruction from the Board. It was determined that the refund process for such charges was an administrative function, suggesting that the respondents should have sought recourse through the Administrative Department for refund instead of appealing under Section 128 of the Customs Act.

4. Consequently, the Tribunal set aside the orders of the Commissioners (Appeals) and directed the respondents to approach the Administrative Department for any potential refund of the cost recovery charges. The appeals filed by the Revenue were allowed, highlighting the importance of following the correct administrative procedures for seeking refunds, especially in cases not explicitly covered by statutory provisions. The judgment was delivered on January 5, 2006, in an open court session.