2022 (11) TMI 1449 - HC - Customs

Maintainability of Refund claim - Seeking to quash the public notice issued for modification of a self-assessed Bill of Entry - application filled for re-assessment of the Bills of Entry in terms of Section 149 read with Section 154 of the Customs Act 1962 - Notification No. 45/2005-Cus - Exemption of duty at 4% for clearance of the goods from Special Economic Zone (SEZ) to Domestic Tariff Unit (DTA) - non-agricultural intermediate products wastes and scrap - HELD THAT - Unless or otherwise Bill of Entry submitted by the petitioner with regard to the clearance of the goods from SEZ to DTA area is modified/corrected to which the petitioner is entitled to by filing Application u/s 149 the petitioner would not be entitled to avail the benefit available under the Notification for exemption. Therefore even assuming without admitting that if the application filed by the petitioner for modification/correction of Bill of Entry was cancelled/rejected and the petitioner preferred any Appeal before the Appellate Authority even then the error committed by the petitioner while filing the Bill of Entry cannot be corrected and the repondent-Department would proceed to assess as if the petitioner has not claim exemption. Therefore for the purpose of getting exemption as per Notification it is necessary to get Bill of Entry modified/corrected by filing application u/s 149 of C.A. Act and re-assessment has to be made by the Authorities concerned in the event the petitioner is entitled for refund claim. The petitioner has filed an application for refund and in terms of Section 149 the petitioner also filed application for modification of the Bill of Entry. In such view of the matter this Court is of the view that the impugned order passed by the first respondent is unsustainable and the same is liable to be set aside. Accordingly the Writ Petition No. 4222 of 2020 is allowed the impugned order dated 27.01.2020 is set aside and the first respondent is directed to consider the Modification Application filed by the petitioner dated 01.01.2020 and permit the petitioner to make corrections in the Bills of Entry and thereafter re-assess the income of the petitioner so as to enable the petitioner to claim refund in terms of Notification No. 45/2005 Cus. which the petitioner claimed vide Application dated 14.09.2016. Insofar as Writ Petition No. 4223 of 2020 is concerned wherein the challenge is to the Public Notice issued by the second respondent which is also nothing but an outcome of wrong interpretation of the decision of the Hon ble Supreme Court in ITC Ltd s case 2019 (9) TMI 802 - SUPREME COURT this Court is of the view that in the light of the observations made in W.P. No. 4222 of 2020 wherein the issue as to whether the petitioner is entitled to file application u/s 149 of C.A. Act seeking for correction/modification of the Bill of Entry is decided in favour of the petitioner the Public Notice impugned in W.P. No. 4223 of 2020 has to be given a go by. Accordingly W.P. No. 4223 of 2020 is also allowed and the impugned public notice is quashed. In the result both the Writ Petitions are allowed.

Summary

Issues:
Challenge to communication dated 27.01.2020 for re-assessment of Bill of Entry and quashing of public notice dated 18.10.2019.

Analysis:

Issue 1: Challenge to communication dated 27.01.2020
The petitioner, a Company engaged in non-agricultural products, sought exemption under Notification No. 45/2005-Customs for goods clearance. The petitioner failed to claim the exemption initially and applied for reassessment and refund. The first respondent rejected the claim, citing that modifications can only be done through appeal. The petitioner argued that the Supreme Court's decision allows for modification applications without appeal. The court agreed, stating that without amending the Bill of Entry, the petitioner cannot claim the exemption. The impugned order was set aside, directing the first respondent to consider the modification application for re-assessment.

Issue 2: Quashing of public notice dated 18.10.2019
The second writ petition challenged a public notice that restricted reassessment without appeal. The court, based on the decision in the first petition, ruled in favor of the petitioner, allowing the second petition and quashing the public notice. Both petitions were allowed, emphasizing the need for Bill of Entry modification for claiming exemptions under the Customs Act.