2023 (6) TMI 860 - AT - Customs

Refund of SAD - rejection of refund claim on the ground of limitation pertaining to 9 Bills of Entry - HELD THAT - The rejection of the refund claim on the ground of limitation is totally perverse as the Adjudicating Authority has already decided the issue by holding the same within time prescribed and the Revenue is not aggrieved with the said finding as no appeal has been filed by them. The appellant by merely filing an appeal against the order of the Adjudicating Authority cannot be worse off than what he was. 1st Appeal against any order passed by any officer below the rank of Commissioner of Customs lies with the Commissioner of Customs (Appeals) in terms of Section 128 (if the appeal has been preferred by assessee) or Section 129(D)(4) (Department s appeal on review of order as the case may be. Legislature has very carefully worded the provision regarding filing of appeal by the Revenue as the said appeal lies only upon after the review of the order by the Commissioner of Customs. When without review by proper authority the department can t file any appeal before the Commissioner (Appeals) then where is the question of the Commissioner (Appeal) suo motu taking up any issue from the adjudication order which has been decided in favour of the assessee, to decide the same against the assessee that too in the appeal filed by the assessee. The Adjudication Order i.e. Order-in-Original has been passed on 23.2.2016 and the limitation of filing appeal against that order has expired 7-8 years back, therefore now the department can t file any appeal before the 1st Appellate Authority and in that scenario the findings recorded by the adjudicating authority in favour of the appellant have attained finality. Matter remanded back to the Commissioner (Appeals) with a direction to decide the appeal filed by the appellant afresh confining to the issue raised by the appellant before the said appellate authority - appeal allowed by way of remand.

Summary

Issues involved:
The issues involved in the judgment are the rejection of refund claim by the Commissioner of Customs on the ground of limitation, the authority of the Commissioner to decide on issues not before him, and the appellate process for filing appeals by the Revenue.

Issue 1: Rejection of refund claim on the ground of limitation
The appellant filed a refund claim for 4% Special Additional Duty (SAD) on import of Tractor-Trailer Axle using DEPB scrips against 10 Bills of Entry in 2012. The Adjudicating Authority rejected the re-credit of the refund claim of Rs.7,87,229/- paid via DEPB scripts, stating it was filed within the prescribed time. The Commissioner of Customs rejected the refund claim on the ground of limitation pertaining to 9 Bills of Entry, even those allowed by the Adjudicating Authority, and remanded the claim for the balance 1 Bill of Entry for fresh decision.

Issue 2: Authority of the Commissioner to decide on issues not before him
The Tribunal found it surprising that the Commissioner gave a finding on an issue not before him, as the statute does not permit such action. The rejection of the refund claim on the ground of limitation was deemed perverse since the Adjudicating Authority had already decided the issue within the prescribed time, and the Revenue did not appeal against it. The Tribunal highlighted the legislative provisions regarding the filing of appeals by the Revenue, emphasizing that the Commissioner cannot suo motu take up any issue decided in favor of the assessee.

Issue 3: Appellate process for filing appeals by the Revenue
The Tribunal emphasized that the Commissioner of Customs must review the adjudication order before directing the filing of an appeal before the Commissioner (Appeals). As the limitation for filing an appeal against the Adjudication Order had expired, the department could not file any appeal before the 1st Appellate Authority. The Tribunal set aside the impugned order and remanded the matter back to the Commissioner (Appeals) to decide the appeal afresh, focusing only on the issues raised by the appellant.

In conclusion, the Tribunal allowed the appeal by way of remand, directing the Commissioner (Appeals) to decide the appeal filed by the appellant afresh, considering only the issues raised by the appellant and providing both sides with a reasonable opportunity to present relevant documents.