2013 (6) TMI 577 - AT - Customs

Refund claim - Whether can filled by the respondent directly, without first challenging the assessment order - benefit of Notification No. 13/2006 denied by the Customs Authorities - Held that - There was a list between the respondent and the Revenue, which was required to be solved first. The only mode for solving the same was filing an appeal there against before the higher appellate forum. The origination of refund claim would come subsequently, as a consequence of the decision of the higher appellate forum, on the disputed issue. As such, agree with the DR that direct filing of refund claim before settling the dispute on the availability or otherwise of the notification, is not in accordance with the law declared by in the case of Priya Blue Industries Ltd. vs. CC (Preventive) ( 2004 (9) TMI 105 - SUPREME COURT OF INDIA).

Summary

Issues:
1. Claim of exemption from counter-veiling duty under Notification No. 13/2006.
2. Denial of refund claim for counter-veiling duty paid at the time of clearance of goods.
3. Whether the respondent can file a refund claim directly without challenging the assessment order first.

Analysis:
1. The judgment deals with the appeal filed by the Revenue against the order passed by the Commissioner (Appeals) regarding the exemption from counter-veiling duty (CVD) claimed by the respondents under Notification No. 13/2006. The respondents imported Hing and cleared it by paying Customs Duty and CVD as per the Act. The Revenue authorities denied the exemption claimed by the appellants under the said notification, leading to the payment of duty and clearance of goods.

2. Subsequently, the appellants sought a refund of the CVD paid during the clearance of goods. The Adjudicating Authority denied the refund claim, but the Commissioner (Appeals) allowed it, prompting the Revenue to file the present appeal. The key issue was whether the refund claim could be filed directly without challenging the assessment order first.

3. The Tribunal observed that at the time of clearance, there were conflicting views between the importer and the Revenue regarding the availability of the exemption notification. While the importer believed the benefit applied to them, the Revenue disagreed. The Tribunal emphasized that disputes like these should be resolved through the higher appellate forum before initiating a refund claim. Directly filing a refund claim without settling the underlying dispute was deemed contrary to established legal principles, citing the decision in the case of Priya Blue Industries Ltd. vs. CC (Preventive).

4. Additionally, the Tribunal noted that the denial of the exemption notification did not amount to a mistake on the bill of entry necessitating rectification under Section 149 of the Customs Act. Therefore, the Commissioner (Appeals)'s observation regarding the application for correction under Section 149 was deemed irrelevant in this context.

5. Consequently, the Tribunal set aside the impugned order and allowed the appeal filed by the Revenue, emphasizing the need to resolve the underlying dispute before pursuing a refund claim directly. The judgment underscores the importance of following established legal procedures and seeking resolution through the appropriate channels before seeking remedies such as refunds in customs matters.