2017 (12) TMI 1114 - HC - Customs

Refund of Terminal Excise Duty (TED) - validity of Policy Circular issued by the second respondent - policy provisions and Foreign Trade (Development and Regulations) Act, 1995 - Held that - reliance placed in the case of Kandoi Metal Powders Mfg. Co. Pvt. Ltd. Versus Union of India And Others 2014 (2) TMI 773 - DELHI HIGH COURT , where Court also is unable to see the reason why the respondents were of the view that refund claim or benefit under the CENVAT regime under the Central Excise Act or the other statutory schemes framed under it is available. In this Court s opinion, that regime operates in its own terms and is independent of the rights and liabilities of the petitioner and the respondents under the import-export policies framed under the 1992 Act. The third respondent is directed to process the refund claim in accordance with 2009 Policy by taking into consideration the petitioner s refund application and pass appropriate orders on merits and in accordance with law within a period of three months.

Summary

Issues:
1. Challenge to Policy Circular denying Terminal Excise Duty (TED) refund.
2. Challenge to rejection letter denying refund claim.

Analysis:

Issue 1: Challenge to Policy Circular denying Terminal Excise Duty (TED) refund
The petitioner filed a writ petition challenging the Policy Circular issued by the second respondent denying the Terminal Excise Duty (TED) refund, contrary to policy provisions and the Foreign Trade (Development and Regulations) Act, 1995. However, the petitioner later decided to withdraw the challenge to the Circular and requested the respondents to consider their application for refund. Consequently, the petition challenging the Circular was dismissed.

Issue 2: Challenge to rejection letter denying refund claim
In the petitions challenging the rejection letters issued by the third respondent denying the refund claim for Terminal Excise Duty (TED), the Court considered previous similar cases where the petitioner had given up the challenge to the policy circular and pursued the refund claims. Referring to relevant legal precedents, including decisions from the High Courts of Bombay, Delhi, and Madras, the Court allowed the writ petitions. The Court emphasized that the authorities had erred in denying the refund claim based on a clarification by the Policy Interpretation Committee, which suggested availing CENVAT credit provisions instead. The Court held that the existing policy provisions entitled the petitioner to a refund, and subsequent amendments liberalizing the regime did not justify denying the refund claim. The Court directed the authorities to process the refund claims within three months in accordance with the 2009 policy.

Conclusion:
The High Court allowed the writ petitions challenging the rejection of refund claims for Terminal Excise Duty, emphasizing the entitlement of the petitioner to the refund under the existing policy provisions. The Court directed the authorities to process the refund claims within a specified timeframe, following legal precedents and rejecting the notion of denying refunds based on subsequent amendments to the regime. The Court's decision was based on a thorough analysis of relevant legal principles and precedents from various High Courts.