2018 (8) TMI 1393 - HC - Central Excise

Invocation of Revisional Jurisdiction - Section 35EE of the Central Excise Act, 1944 - rebate/refund of CVD - CVD on imported inputs and used in the manufacture of final produce is paid under Section 3 of the Customs Tariff Act, 1962 - Held that - It becomes ineluctable from Exhibit P3 that the only reason for the Revisional Authority to have allowed the application of the first respondent, which was disabled from obtaining the benefit of rebate/draw back/ cenvat credit or cash refund of CVD, was because that such procedural irregularities, cannot be then used to the detriment of the assessee - Since the order does not say what the procedural irregularities were and since the second respondent has not concluded as to how such irregularities have impacted the parties concerned, it is certain that the conclusions therein cannot obtain favor of law. The second respondent is directed to re-consider the Revision Application of the first respondent, which led to Exhibit P3, after affording an opportunity of being heard to both the petitioner - petition disposed off.

Summary

Issues:
Impugning Exhibit P3 order under Section 35EE of the Central Excise Act, 1944 regarding rebate on input for imported raw materials, rejection of Counter Veiling Duty (CVD) claims, Revision Application filed by the first respondent, procedural irregularities impacting benefit eligibility, lack of detailed procedural irregularities in the impugned order, quashing Exhibit P3, directing re-consideration of Revision Application.

Analysis:
The judgment pertains to a writ petition filed by the Commissioner of Central Excise challenging an order issued by the Joint Secretary, Government of India, Ministry of Finance. The order was issued under Section 35EE of the Central Excise Act, 1944, in response to an application by a private company regarding the import of 'Imprex film faced plywood' and claiming rebate on input for both indigenous and imported raw materials.

The key issue in consideration was the rejection of the Counter Veiling Duty (CVD) claims by the first respondent due to procedural grounds related to the payment of CVD on imported inputs used in the manufacturing process. The first respondent had appealed the decision, which was subsequently dismissed, leading to the filing of a Revision Application before the second respondent.

The judgment highlights that the Revisional Authority allowed the Revision Application of the first respondent based on the belief that procedural irregularities should not hinder the neutralization of duties suffered when the payment of duty and export of goods are not disputed. However, the judgment points out a crucial flaw in the decision, noting that the order fails to specify the procedural irregularities that impacted the eligibility of the first respondent for rebate, draw back, cenvat credit, or cash refund of CVD.

As a result, the court quashes the impugned order (Exhibit P3) and directs the second respondent to re-consider the Revision Application of the first respondent, emphasizing the need to identify and address the procedural irregularities that have hindered the benefit entitlement. The court stresses the importance of affording both parties an opportunity to be heard and complying with all necessary procedural requirements within a specified timeframe.

In conclusion, the judgment sets aside the original order, highlighting the necessity for a fresh consideration of the Revision Application in light of the procedural irregularities, ensuring a fair and comprehensive review of the matter.