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2014 (4) TMI 1110 - Commissioner - Central Excise100% EOU - inter-unit transfer to another 100% EOU - Refund of duty paid under protest - Authorized person to sing the refund application and affidavit - Procurement of raw material without payment of duty (free of duty) for manufacturing and export of goods - Notification No. 53/97-Cus. and Notification No. 123/81-C.E. - Department had observed that the Secretariat of Industrial Assistance or SIA in short has permitted manufacture and export of hardware and import of related goods free of duty but the Appellants have not satisfied the value addition norms to the extent of 77.3% and the goods procured by them locally were not connected with the development and export of software and do not qualify for the exemption. Held that - CESTAT in its final order No. 1504/2010 dated 23-6-2010 has observed that, there is no finding by the DGFT evidencing non-fulfilment of export obligation by the Appellants and the fact that the duty was assessed at the time of import in terms of Notification No. 13/81-Cus., dated 9-2-1981 and 123/81-C.E. dated 2-6-1981 on the strength of essentiality certificate issued by the sponsoring authority and warehoused for manufacture in bond; that at the time of issuance of show cause notice in 1988, the goods were lying in the warehouse which were de-bonded only during the year 2002 for which demand could not have been raised unless removed from the warehouse. Without challenging the order passed by a higher appellate authority, the adjudicating authority has passed the impugned order wherein he has neglected the findings of the CESTAT and rejected the refund claim filed by the Appellants on negligible grounds. Once the items are permitted to be imported and warehoused in terms of permission of the Development Commissioner, the Customs Department, later, could not question the eligibility of Notification No. 52/2003-Cus., dated 31-3-2003. Refund to be allowed subject to production of Board Resolution in favor of signatory of application. - Decided in favor of assessee.
Issues Involved:
1. Violation of principles of natural justice. 2. Rejection of refund claim due to non-submission of original TR-6 Challans. 3. Authorization of Shri B.M. Tambakkad to file the refund application. 4. Entitlement to interest on delayed refund under Section 11BB of the Central Excise Act, 1944. 5. Compliance with higher appellate authorities' orders. Detailed Analysis: Violation of Principles of Natural Justice: The appellants argued that the adjudicating authority violated the principles of natural justice by not providing an opportunity for a personal hearing and hastily passing the impugned order within 13 days of issuing the show cause notice. The adjudicating authority's reliance on the returned postal notices as sufficient service was challenged. The appellate authority found that the adjudicating authority did not explore other options for serving the notice and failed to ascertain whether the appellant's company was operational, thus violating the principles of natural justice. Rejection of Refund Claim Due to Non-Submission of Original TR-6 Challans: The adjudicating authority rejected the refund claim on the grounds that the appellants did not provide the original TR-6 Challans, instead submitting an affidavit stating the challans were lost. The appellants contended that they complied with the requirement of executing a fresh affidavit as directed by the Range Officer. The appellate authority noted that the adjudicating authority deviated from his earlier stance and could have verified the payment of duty and interest from the Customs authorities. Authorization of Shri B.M. Tambakkad to File the Refund Application: The adjudicating authority found that Shri B.M. Tambakkad was not authorized to file the refund application. However, the appellants provided a copy of the company's Board Resolution dated 24-1-2011, authorizing Shri B.M. Tambakkad to act on behalf of the company. The appellate authority confirmed this authorization but noted that the resolution was not submitted to the Department before the impugned order was passed. Entitlement to Interest on Delayed Refund Under Section 11BB of the Central Excise Act, 1944: The appellants claimed interest on the delayed refund under Section 11BB, citing the Supreme Court's decision in Ranbaxy Laboratories v. UOI. The appellate authority did not specifically address this issue in the judgment, but the appellants' entitlement to interest on delayed refunds is supported by judicial precedents. Compliance with Higher Appellate Authorities' Orders: The appellants argued that the adjudicating authority disregarded the CESTAT's final order, which vacated the demand of duty and held that the Customs Department could not question the eligibility of the Notification once the goods were permitted to be imported and warehoused. The appellate authority found that the adjudicating authority neglected the CESTAT's findings and rejected the refund claim on negligible grounds without challenging the higher appellate authority's order. Conclusion: The appellate authority allowed the appeal, setting aside the impugned order and directing the adjudicating authority to verify the company's Board Resolution dated 24-1-2011 while considering the refund claim. The decision emphasized adherence to the principles of natural justice, proper verification of authorization, and compliance with higher appellate authorities' orders.
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