2022 (12) TMI 1068 - HC - Customs

Duty Drawback - whether the goods exported under the Shipping bill would fall under S.S.No. 85.37 or not - HELD THAT - The grievance of the Petitioner that the order in Appeal dated 31 December 1997 has not been considered at all is justified. Though this order is noted in the impugned order there is no discussion as to what is the implication of the said order, which according to the Petitioner is inter parte binding. There is no discussion as to why the said order should not be taken into consideration or if taken into consideration what is the implication thereof. In the light of the fact that there was a pre-existing order of the Commissioner (Appeals) inter parte regarding the same product, where different classification and impugned order has been arrived at and which supports the claim of the Petitioner, the same should have been considered and the Petitioner is right in contending that failure to do so has caused serious prejudice to the Petitioner - the proceedings need to be remanded to the Appellate Authority for considering the effect and implication of the order in Appeal dated 31 December 1997. The impugned order dated 31 December 1997 passed by the Commissioner of Customs (Appeals) and order dated 13 June 2012 passed by the Revisionary Authority, are quashed and set aside. Proceedings are restored to the file of the Commissioner of Customs (Appeals).

Summary

Issues:
Challenge to order refusing duty drawback claim under specific tariff entry.

Analysis:
The Petitioner challenged the order refusing duty drawback of Rs.2,52,429 under S.S.No. 85.37. The Petitioner exported circuit breakers and switch gears of high voltage under ten shipping bills. The Respondent sought information regarding the goods exported, leading to a dispute on the classification under S.S.No. 85.37, 85.35, and 85.36. The Commissioner of Customs classified the goods under S.S.No. 85.35, reducing the drawback rate. The Petitioner appealed, claiming the goods fell under S.S.No. 85.37. The Commissioner (Appeals) dismissed the appeal, leading to a revision before the Revisional Authority.

The Revisional Authority upheld the classification under S.S.No. 85.35 based on the four-digit level alignment in the drawback schedule. The Petitioner contended that a previous order classified the goods under S.S.No. 85.37, which was not considered in the impugned order. The High Court found merit in this contention, noting that the failure to consider the previous order caused prejudice to the Petitioner. Consequently, the High Court quashed the impugned order and remanded the proceedings to the Appellate Authority for reconsideration, emphasizing the need to assess the implications of the previous order.

The High Court clarified that the observations regarding the previous order were to stress the importance of reconsideration, not to conclusively determine the matter. The impugned orders were set aside, and the proceedings were restored to the Commissioner of Customs (Appeals) for fresh consideration. The High Court made the rule absolute without costs, instructing the Appellate Authority to expedite the proceedings considering the delay due to remand.