2005 (5) TMI 205 - AT - Customs

Summary

Issues:
1. Challenge to the correctness of the Order-in-Appeal based on the time-barred show cause notice for recovery of erroneous refund.
2. Interpretation of the role and liability of the clearing agent in customs matters.
3. Application of the Apex Court judgment in CC, Cochin v. Trivandrum Rubber Works Ltd. to determine the validity of the show cause notice issued.

Analysis:
1. The appellant contested the Order-in-Appeal on the grounds that the show cause notice dated 14-3-2000 for recovery of an erroneous refund of Rs. 2,30,687/- was time-barred as it was issued beyond the six-month period. The Revenue argued that the notice served on the Clearing House Agent (CHA) saved the time limit, claiming the CHA was authorized to receive the notice. However, the Chartered Accountant cited the Apex Court judgment in CC, Cochin v. Trivandrum Rubber Works Ltd., emphasizing that the importer is the person chargeable with duty in the case of imports, and the duty must be recovered from the importer unless it is impossible to do so. As the Revenue did not assert the clearing agent's liability, the notice should have been issued to the importer within six months. The Tribunal agreed, ruling that the show cause notice to the CHA for recovery of the erroneous refund was not in accordance with the law, rendering the impugned order time-barred.

2. Upon careful consideration and examination of the cited judgment, the Tribunal found that no claim for recovery was made against the clearing agent, whose role ended after the refund was issued. The erroneous refund must be based on strong grounds, and if recovery cannot be made from the importer, only then can the clearing agent be held liable under Section 147(3) of the Customs Act. Since the Revenue did not establish that recovery from the importer was impossible, the Apex Court judgment applied, requiring the show cause notice to be served on the importer within the statutory time limit. Consequently, the impugned order confirming duty on the importer was deemed time-barred, and the appeal was allowed on this ground.

This detailed analysis of the judgment highlights the issues of challenging the correctness of the Order-in-Appeal based on a time-barred show cause notice, interpreting the liability of the clearing agent in customs matters, and applying the relevant Apex Court judgment to determine the validity of the notice issued.