2023 (11) TMI 380 - AT - Customs

Condonation of delay in filing the Cross Objections - rejection on the ground that the application not filed in the manner prescribed by the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 - HELD THAT - It is seen from a perusal of section 129A(4) of the Customs Act, that it is only on receipt of notice that the party against whom the appeal has been preferred, may file within 45 days of the receipt of the notice, a Memorandum of Cross Objections - In the present case, the notice dated 24.01.2020 was sent to the respondent by the Registry of the Tribunal by registered post with acknowledgment due on 30.01.2020. The office has also reported that the said letter dated 24.01.2020 with copy of appeal was also served in the office of the Chief Commissioner (Authorised Representative) on 28.01.2020. Section 153(1) of the Customs Act provides that a notice may be served by giving or tendering it directly or on the authorised representative of the addressee, or by sending it by registered post with acknowledgment due to the person to whom it is issued. When such a notice is tendered, it shall be deemed to have been served on the date on which it is tendered and when such a notice is sent by registered post with acknowledgement due, it shall be deemed to have been received by the addressee at the expiry of the period normally taken by such post in transit unless the contrary is proved - In the present case, the copy of the appeal was tendered in the office of the Chief Commissioner (Authorised Representatives) on 28.01.2020 and the letter addressed to the respondent sent by the Registry of the Tribunal by Registered Post with acknowledgement due was despatched on 30.01.2020. All that has been stated in the application filed to condone the delay is that the copy of the appeal was not available in the file of the department and the appeal was received only on receipt of the letter dated 21.07.2022 sent by the Additional Commissioner (Authorised Representative). The department has, therefore, failed to furnish any satisfactory explanation for condoning the enormous delay in filing the Cross Objections - The Delay Condonation Application, therefore, deserves to be rejected and is rejected.

Summary

Issues Involved:
1. Delay in filing Cross Objections by the department.
2. Compliance with procedural requirements for filing Cross Objections and Delay Condonation Application.
3. Entitlement of the appellant to a reduced rate of Additional Duty of Customs and refund claim.
4. Doctrine of unjust enrichment and whether the burden of duty was passed on to buyers.

Summary:

1. Delay in Filing Cross Objections:
The department filed Cross Objections on 28.12.2022, accompanied by an application to condone a delay of 977 days. The Tribunal examined whether the delay should be condoned and if the Cross Objections were filed as per the prescribed procedure. The department argued that the delay was due to the unavailability of the appeal copy in the departmental file and cited the Supreme Court's order extending limitation periods due to the COVID-19 pandemic. The Tribunal found that the notice was deemed served on 28.01.2020, and the delay was not satisfactorily explained, rejecting the delay condonation application and dismissing the Cross Objections.

2. Compliance with Procedural Requirements:
The appellant contended that the Cross Objections and the delay condonation application were not filed in accordance with the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982. The Tribunal noted that the Cross Objections were signed and verified by the Deputy Commissioner instead of the Principal Commissioner and lacked specific authorization. However, the Tribunal did not decide on this objection as the delay condonation application was already rejected.

3. Entitlement to Reduced Rate of Additional Duty and Refund Claim:
The appellant imported mobile phones and paid Additional Duty of Customs at 6% but claimed a reduced rate of 1% based on a notification dated 17.03.2012, similar to a condition examined by the Supreme Court in SRF Ltd. The Deputy Commissioner initially sanctioned the refund but directed it to be credited to the Consumer Welfare Fund, citing the appellant's failure to prove that the duty incidence was not passed on to buyers. The Commissioner (Appeals) upheld this decision, stating that the appellant did not conclusively prove the burden of duty was not passed on.

4. Doctrine of Unjust Enrichment:
The Deputy Commissioner and Commissioner (Appeals) both held that the appellant failed to conclusively prove that the incidence of duty was not passed on to buyers. The Chartered Accountant's certificate alone was deemed insufficient without supporting documents. Therefore, the refund claim was considered hit by the doctrine of unjust enrichment, and the sanctioned amount was directed to be credited to the Consumer Welfare Fund.

Conclusion:
The Tribunal rejected the delay condonation application and dismissed the Cross Objections filed by the department. The appeal by the appellant against the order directing the refund to be credited to the Consumer Welfare Fund was not addressed in the summarized judgment.