2018 (3) TMI 1636 - HC - Customs

100% EOU - Refund claim - Held that - This Court is of the view that when the order passed by the Tribunal has not been stayed or set aside by the Hon ble Supreme Court, it is the bounden duty of the Adjudicating Authority to follow the law laid down by the Tribunal. Since a binding decision has not been followed by the Adjudicating Authority in this case, this Court can interfere straight away without relegating the assesse to file an appeal. Order quashed.

Summary

Issues:
Classification of export consignment under CTH 26140010 or CTH 26140020, Adjudication of refund claim, Compliance with Tribunal's order by Adjudicating Authority

Classification Issue:
The petitioner, a registered 100% EOU, contested the classification of their export consignment under CTH 26140010 by the respondent, claiming it should fall under CTH 26140020. The Adjudicating Authority determined that the exported Ilmenite did not undergo enhancement or upgrading processes, thus classified it under CTH 26140010. The Authority noted similarities with a previous Tribunal case, pending in the Supreme Court, where a decision favored the assessee. The High Court emphasized the binding nature of the Tribunal's decision and quashed the Adjudicating Authority's orders, directing refund to the petitioner.

Adjudication Issue:
The petitioner applied for a refund, but the second respondent delayed processing, citing pending adjudication. The High Court intervened, impleading the Adjudicating Authority to expedite the decision. The Authority's rejection of the petitioner's stand was based on the lack of enhancement in the exported Ilmenite, aligning with CTH 26140010. However, the Court emphasized the relevance of the Tribunal's decision, not stayed or set aside by the Supreme Court, which the Adjudicating Authority failed to follow. Consequently, the High Court quashed the Authority's orders and directed the refund, with the petitioner offering immovable property security until the Supreme Court's final decision.

Compliance with Tribunal's Order Issue:
The High Court highlighted the importance of the Tribunal's decision in a similar case, pending before the Supreme Court, which favored the assessee. Emphasizing the binding nature of the Tribunal's decision, the Court held the Adjudicating Authority accountable for not following the established law. The Court intervened, quashing the Authority's orders and directing the refund to the petitioner, with the condition of immovable property security until the Supreme Court's final decision.