2017 (1) TMI 496 - HC - Central Excise

Grant of export rebate - Held that - it is submitted that the same shall be considered and granted within a period of two weeks from the date of providing necessary particulars such as AR-4 and bank realization certificate. Concerned respondents are directed to act accordingly and consider the grant of rebate within a period of two weeks from furnishing the aforesaid documents. Interest on delayed payment of rebate - Held that - the prayer with respect to the interest on delayed payment of rebate is dismissed as not pressed. Return of Bank Guarantee - Held that - As and when such prayer is made with proof of export, the question with respect to return of bank guarantee may be considered and dealt with at the earliest. Imposition of penalty u/r 17 of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956 - Held that - On considering Rule 17 the purpose and object to levy the penalty seems to be that on one hand the concerned person has exported the dutiable goods under bond (without making the payment of duty) and on the other hand thereafter he fails to furnish the proof of such export to the satisfaction of the Excise Commissioner. Meaning thereby, he continues to get the benefit of export without making the payment of duty as he has exported the goods under bond - the respondent authority is not justified to levy the penalty upon the petitioners under Rule 17 of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956. Petition allowed - decided partly in favor of petitioner.

Summary

Issues:
1. Delayed disbursement of export rebate amounts
2. Payment of interest on delayed rebate payments
3. Imposition of penalties for delayed submission of proof of exports
4. Return of bank guarantees
5. Challenge to penalty imposed under Rule 17 of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956

Analysis:

1. Delayed Disbursement of Export Rebate Amounts:
The petitioners sought a writ of mandamus for immediate disbursement of due export rebate amounts totaling ?45,93,405. The court directed concerned respondents to grant rebate within two weeks upon submission of necessary documents like AR-4 and bank realization certificate. Most rebate claims were already granted, except for three cases.

2. Payment of Interest on Delayed Rebate Payments:
The petitioners' claim for interest on delayed rebate payments was dismissed as not pressed, with the larger issue kept open for future consideration. The court did not address this issue further in the present petition.

3. Imposition of Penalties for Delayed Submission of Proof of Exports:
Regarding penalties imposed for delayed submission of proof of exports under Rule 17 of the Excise Duties Rules, the court analyzed the applicable rules. It noted that Rule 17 applies to dutiable goods exported under bond, not on payment of duty. The penalty under Rule 17 is for failure to furnish proof of export for goods exported under bond. As the petitioners exported goods on payment of duty, the penalty imposed was deemed unjustified, leading to the quashing of the penalty of ?1,28,000. The respondents were directed to return the amount within six weeks.

4. Return of Bank Guarantees:
The petitioners requested the return of original bank guarantees, highlighting their expiry and the financial burden caused by the respondents' withholding. The court did not address this issue in the present petition but allowed the petitioners to approach the appropriate authority with proof of export for consideration.

5. Challenge to Penalty Imposed under Rule 17:
The court examined the penalty imposed under Rule 17 of the Excise Duties Rules and found it unjustified as the goods were exported on payment of duty, not under bond. The penalty levied was quashed, and the respondents were directed to return the amount with interest if not done within six weeks.

In conclusion, the court partially allowed the petition, quashing the penalty imposed under Rule 17 and ordering its return with interest. Other issues like delayed rebate payments and return of bank guarantees were either addressed partially or left open for future consideration.