2017 (8) TMI 510 - HC - Customs

Maintainability of appeal - Remittance of duty - section 23 of Customs Act, 1962 - Held that - The dispute regarding short delivery of scrap was found to be involved any disputed question of facts which, in an opinion of the Court, cannot be gone into in a writ petition under Article 226 of the Constitution - appeal dismissed being not maintainable.

Summary

Issues:
1. Whether duty can be remitted on the grounds of short receipt of goods under section 23 of Customs Act, 1962 after clearance of the goods for home consumption?
2. Whether the tribunal is justified in ordering a refund of customs duty in the absence of evidence on record with respect to short delivery of goods, especially when the Bills of Entry were provisionally assessed and not challenged by the assessee?

Issue 1:
The Tax Appeal was admitted for consideration of the substantial question of law regarding the remission of duty based on the short receipt of goods after clearance for home consumption under section 23 of the Customs Act, 1962. The assessee had claimed a refund of customs duty amounting to &8377; 11 lakhs, asserting that duty was paid on the imported steel scrap as per the input documents, but the actual quantity delivered was less. The Tribunal accepted the claim, leading to the department filing the appeal. The circulars issued by CBEC set a monetary limit for the department to pursue appeals before the High Court, with exceptions for certain cases. The appeal was contested based on the applicability of these circulars.

Issue 2:
The second question arose regarding the justification of the tribunal in ordering a refund of customs duty in the absence of evidence on record regarding the alleged short delivery of goods. The circulars issued by CBEC set a minimum tax effect for pursuing appeals before the High Court, with exceptions for certain categories of cases, including those involving legal and/or recurring issues. The High Court analyzed the previous judgment involving a similar refund claim and short delivery dispute, where the Court dismissed the writ petition due to the pending refund claim before the appropriate authority. The Court emphasized that the previous judgment did not limit the assessee's contentions on the refund claim already filed before the competent authority. Ultimately, the Tax Appeal was dismissed as it did not fall under the exceptions provided in the circulars for pursuing appeals before the High Court.