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2009 (12) TMI 263 - AT - CustomsRefund- Limitation- Export Obligation discharge certificate not produced and bank guarantee encashed. EODC produced later and refund claim rejected as time barred. Show cause notice not issued or adjudicated for failure to fulfil export obligation. Encashment of bank guarantee not treatable as duty payment. Impugned order granting refund sustainable.
Issues:
Department's appeal against rejection of refund claim as time-barred. Analysis: The appeal pertains to a refund claim of Rs.30,500/- by the Department against the order of the original authority rejecting the claim as time-barred. The respondent imported raw materials without duty payment under an Advance Licence, but failed to produce the necessary Export Obligation Discharge Certificate (EODC) in time. Consequently, the Department encashed the bank guarantee of Rs.30,500/- furnished by the respondent. The original authority rejected the refund claim, citing it was filed after six months from the duty payment date. The Department's representative, the learned DR, supported the original authority's decision and cited legal precedents. However, the Member (T) noted that the Commissioner (Appeals) based the decision on a Tribunal ruling in a similar case, where encashment of a bank guarantee was not considered as duty payment. The Tribunal's decision was upheld by the High Court of Madras in another case. In the present case, the Department did not issue a show cause notice or confirm the duty demand for non-compliance with export obligations; they only encashed the bank guarantee. The Member (T) found the Tribunal's decision applicable to the current case and concluded that the cited legal precedents by the learned DR were not relevant. Therefore, the appeal by the Department was rejected based on the finding that the encashment of the bank guarantee did not constitute duty payment, aligning with the Tribunal's previous ruling and the High Court's affirmation in a similar case. The failure of the Department to issue a show cause notice for duty demand further supported the rejection of the appeal.
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