2018 (2) TMI 759 - HC - Customs

Drawback - time limitation - demand on the ground that the petitioner failed to produce evidence of realization of export proceeds in respect of the exported goods within the period allowed under the Foreign Exchange Maintenance Act (FEMA) and Central Excise Duties and Service Tax Drawback Rules, 1995 - Held that - if the petitioner produces evidence to show that the sale proceeds have been realized within the time provided by the R.B.I., which is one year in the instant case, then, the petitioner would be entitled for being repaid the amount, so recovered. However, it is not very clear as to whether such recovery has been done from the petitioner. The matter is remanded to the first respondent for fresh consideration - petition allowed by way of remand.

Summary

Issues:
Challenge to order-in-original for payment of drawback under Customs Act, 1962 and recovery notice based on failure to produce evidence of export proceeds realization within allowed period under FEMA and Rules.

Analysis:
The petitioner challenged the order-in-original directing payment of a sum as drawback under the Customs Act, 1962, and the subsequent recovery notice. The impugned order was based on the petitioner's alleged failure to provide evidence of export proceeds realization within the stipulated period under FEMA and the Rules. The petitioner contended that they had indeed produced the Bank Realization Certificate within the required timeframe, but the Department overlooked it, leading to the issuance of the impugned order and recovery notice.

The Rules stipulate that if an exporter realizes sale proceeds after drawback recovery and provides evidence of such realization within three months, the recovered amount shall be repaid. The petitioner claimed to have realized the amount within one year of availing the drawback, supported by the Bank Realization Certificate issued five months after availing the drawback. The Court noted the possibility of the amount already being recovered but highlighted the importance of evidence showing realization within the RBI-permitted timeframe for repayment.

The Court allowed the Writ Petitions, setting aside the impugned orders and remanding the matter for fresh consideration. The petitioner was directed to appear before the first respondent with proof of timely Bank Realization Certificate availability. If the proof is satisfactory, the first respondent was instructed to assess and decide the matter promptly and in compliance with the law. The first respondent was also authorized to verify the authenticity of the petitioner's claims and the Bank Realization Certificate. No costs were awarded, and connected Miscellaneous Petitions were closed.