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2021 (6) TMI 170 - AT - CustomsRecovery of Refund of SAD - Refund sanctioned has not been reviewed or challenged and the said fact is not in dispute - demand on the ground that the CA certificate was not issued by the statutory auditor who certified the annual accounts of the assessee - HELD THAT - Neither the said fact has been disputed by the Ld. AR appearing for the Revenue. SCN dated 05.03.2018 has been issued under Section 28 of the Customs Act to recover the amount refunded vide earlier Order dated 26.9.2014 with the presumption that the refund was erroneously granted to the assessee. Whether or not refund has been erroneously granted would have to be decided in the manner provided in law. Neither the assessee can seek refund nor Revenue can proceed to recover the refund already sanctioned without challenging the earlier order by way of remedy provided in Section 128 of the Act. Having not challenged the previous order, the Revenue cannot be allowed to re-open the issue - Appeal allowed - decided in favor of appellant.
Issues:
- Demand of Customs duty along with interest and penalty under Section 114A of the Customs Act, 1962. - Validity of the CA certificate submitted by the appellant. - Rejection of appeal on the ground of fraud without considering the submission of a fresh CA certificate. - Non-service of Show Cause Notice (SCN) to the appellant. - Review of the original order dated 26.09.2014 sanctioning refund. - Legal sustainability of proceedings initiated through the impugned SCN. Analysis: 1. Demand of Customs duty: The appellant challenged the demand of Customs duty, interest, and penalty under Section 114A of the Customs Act, 1962. The dispute arose when a Show Cause Notice was issued to recover a refund amount previously sanctioned to the appellant. The issue centered around the validity of the CA certificate submitted by the appellant, which was deemed improper by the authorities due to concerns regarding the certifying firm's credibility. 2. Validity of CA certificate: The primary contention revolved around the authenticity of the CA certificate submitted by the appellant for claiming a refund. The authorities alleged that the certificate was not issued by the statutory auditor who certified the annual accounts, leading to the conclusion that the refund was wrongly sanctioned based on potentially forged documents. The appellant later submitted a fresh certificate from their Statutory Auditor during the appeal process. 3. Rejection of appeal on fraud grounds: Despite submitting a new CA certificate during the appeal, the appeal was rejected by the Ld. Commissioner (Appeals) on the grounds of fraud without considering the fresh evidence presented by the appellant. This raised concerns regarding procedural fairness and the proper evaluation of the appellant's submissions. 4. Non-service of Show Cause Notice: The appellant highlighted that they did not receive the Show Cause Notice, which deprived them of the opportunity to respond and defend their claim of refund. This non-service of the SCN was a crucial procedural flaw that the appellant argued impacted their ability to present their case effectively. 5. Review of original order: The Tribunal emphasized that the refund order dated 26.09.2014, which was not challenged or reviewed, remained undisputed. The failure to challenge this order raised questions about the legal basis for initiating proceedings to recover the refunded amount without following the proper appellate procedures outlined in Section 128 of the Customs Act. 6. Legal sustainability of proceedings: The Tribunal, citing legal precedent, clarified that both the assessee and the Revenue have the right to appeal decisions or orders under the Customs Act. In this case, since the Revenue did not challenge the previous order sanctioning the refund, they could not proceed to recover the amount without following the prescribed appeal process. Consequently, the impugned order confirming the demand of duty, interest, and penalty was set aside, and the appeal was allowed with consequential relief as per law.
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