2023 (10) TMI 1469 - AT - Customs

Entitlement for benefit of N/N. 34/2015-C.E. dated 17.07.2015 and N/N. 37/2015-C.E. dated 21.07.2015 - Challenge to vires of N/Ns. 34/2015 and 37/2015 - It is the case of the assessee-importer that since the Notification was not uploaded in the EDI system the importer approached the assessment group for filing the bills-of-entry manually but the same having not been accepted they paid the duty under protest and thereafter preferred appeals before the first appellate authority - doctrine of merger - HELD THAT - From Sl. No. (4) it is clear that upon granting of leave to appeal though the finality of the judgement decree or order appealed against is put in jeopardy it continues to be binding and effective between the parties unless it is a nullity or unless the court may pass a specific order staying or suspending the operation or execution of the judgement decree or order under challenge. In the case on hand going by the contentions both verbal and written the assessees-importers sought the benefit of Notification No. 30/2004-C.E. which was not available in the Revenue s EDI system. Quite clearly as on the date of filing the impugned bills-of-entry there was a change in the law brought about by the amended Notification Nos. 34/2015 and 37/2015 ibid. and hence the superseded Notification can never be available in the EDI system. What would be available is as per the amended law that is the new Notifications would replace the earlier Notification in the system as well. Hence when a new law comes into effect an importer can avail the benefit of such law only and if such law prescribes certain conditions then it is incumbent upon such claimant to satisfy the conditions prescribed thereunder. He cannot be still heard to stake a claim for the benefit under an effaced Notification which is clearly not in vogue as on the date of import / filing of bills-of-entry. Admittedly what the appellants claimed is the benefit of exemption. Hence when an exemption is claimed the claimant should necessarily satisfy the conditions prescribed under the Notification under which such exemption is claimed. Conveniently the appellants have chosen to make the exemption claim under a Notification which was not in existence at the time of imports. Hence the authorities below have rightly proceeded to examine the claim of exemption under the available / prevalent Notifications i.e. Notification Nos. 34/2015-C.E. and 37/2015-C.E. ibid. and admittedly the appellants have nowhere whispered about fulfilling all the conditions of the said Notifications which replaced Notification No. 30/2004-C.E. The Hon ble Supreme Court in the case of COMMISSIONER OF CUSTOMS (IMPORT) MUMBAI VERSUS M/S. DILIP KUMAR AND COMPANY ORS. 2018 (7) TMI 1826 - SUPREME COURT has clearly laid down that when the benefit of an exemption Notification is claimed the claimant has to necessarily fulfil all the conditions prescribed under the said beneficial Notification. The claim of the appellants for the benefit of Notification No. 30/2004-C.E. as amended vide Notification No. 34/2015-C.E. and Notification No. 37/2015-C.E. is not entertainable and has therefore been correctly rejected by the Ld. first appellate authority - no case being made out for interfering with the impugned Orders-in-Appeal - appeal dismissed.

Summary

Issues Involved:

1. Entitlement to the benefit of Notification No. 30/2004-C.E., as amended by Notification Nos. 34/2015-C.E. and 37/2015-C.E.
2. Validity of the rejection of refund claims and the applicability of the amended notifications.
3. Impact of the doctrine of merger and the granting of special leave to appeal by the Supreme Court.

Issue-wise Detailed Analysis:

1. Entitlement to the Benefit of Notification No. 30/2004-C.E., as Amended:

The primary issue in these appeals was whether the appellants were entitled to the benefit of the exemption under Notification No. 30/2004-C.E., as amended by Notification Nos. 34/2015-C.E. and 37/2015-C.E. The appellants contended that they should be granted the exemption, arguing that the amendments were not applicable to their imports. However, the Tribunal found that the amendments introduced conditions that were not fulfilled by the appellants. Specifically, the amended notifications required that the Central Excise duty should have been paid on the inputs, a condition the appellants could not meet since the goods were manufactured outside India. The Tribunal upheld the first appellate authority's decision, which followed the binding decision of the Hon'ble High Court, dismissing the appellants' claims for exemption.

2. Validity of the Rejection of Refund Claims:

The Tribunal also addressed the rejection of refund claims by the original authority. The appellants' refund claims were initially rejected due to non-submission of required documents and being time-barred. The first appellate authority reassessed the bills of entry and allowed the refund claims for certain entries, finding that the Department had not considered the request for reassessment. The Tribunal upheld this decision for bills of entry filed before the amended notifications came into effect, recognizing the appellants' entitlement to exemption under the original notification. However, for entries filed after the amendments, the Tribunal did not approve the appellate authority's decision, as the conditions of the amended notifications were not met.

3. Impact of the Doctrine of Merger and Special Leave to Appeal:

The Tribunal considered the doctrine of merger in light of the Supreme Court's granting of special leave to appeal against the High Court's judgment. The Tribunal noted that while granting leave to appeal puts the finality of the judgment in jeopardy, it remains binding and effective unless stayed or suspended by the court. The Tribunal emphasized that the decisions of the jurisdictional High Court and the Supreme Court are binding on lower courts. Consequently, the Tribunal ventured into the merits of the case, concluding that the appellants were not entitled to the exemption benefits under the conditions set by the amended notifications.

Conclusion:

The Tribunal dismissed the appeals filed by the assessees, affirming the decisions of the lower authorities that the appellants were not entitled to the benefits of the exemption notifications due to non-fulfillment of the conditions introduced by the amendments. The Tribunal partially allowed the Department's appeal, upholding the reassessment for certain entries filed before the amendments but rejecting claims for entries filed thereafter. The Tribunal's decision was guided by the principles established by higher judicial authorities and the specific conditions of the amended notifications.