2014 (1) TMI 63 - CGOVT - Customs

Rejection of drawback claim - Bar of limitation - Applicability of clause 3(d)(ii) of CBEC Circular No. 14/2003, dated 6-3-2003 - Held that - applicable circular nowhere excludes the status of validity of Brand Rate Letters in respect of Shipping Bill or otherwise and the restriction of one year is a binding for all kinds of Brand Rate Letters except in a case when Brand Rate is calculated by taking into account All Industry Rate of Drawback admissible for any of the input which is not the subject matter herein. Further, Government does not find any legality so as to override and negate the above applicable Statute. The applicant in his grounds is either trying to circumvent the exact status of impugned claims or is citing examples/cases which are not directly/mandatorily applicable for the case matter and proceedings herein - Revision dismissed.

Issues Involved:
1. Validity period of brand rate letters as per Circular No. 14/2003-Cus.
2. Interpretation of Rule 13 of the Customs, Central Excise Duties, and Service Tax Drawback Rules, 1995.
3. Consistency in granting drawback claims across different Commissionerates.
4. Allowance of drawback claims under All Industry Rate Scheme if brand rate claims are time-barred.

Issue-wise Detailed Analysis:

1. Validity Period of Brand Rate Letters as per Circular No. 14/2003-Cus.:
The primary issue is whether the brand rate letters, which were submitted after one year from the date of issuance, are valid. The applicants argued that the letters fixing the amount of drawback for each of the 22 shipping bills were submitted within the permissible period. However, the authorities rejected the claims based on Clause 3(d)(ii) of Circular No. 14/2003-Cus., which states that the validity of brand rate letters is generally restricted to one year. The government upheld this interpretation, stating that the circular binds all brand rate letters to a maximum validity of one year, as supported by the Supreme Court's decision in M/s. Dhiren Chemicals Industry Ltd. case.

2. Interpretation of Rule 13 of the Customs, Central Excise Duties, and Service Tax Drawback Rules, 1995:
The applicants contended that under Rule 13, a triplicate copy of the shipping bill filed for export should be deemed a claim for drawback on the date of export clearance. However, the government clarified that Rule 13 must be read in its entirety, including subsections (2) to (5), which require additional documents such as the LC, packaging list, ARE-1, insurance certificate, and DBK rate letters. The government emphasized that the applicants' claims were not fully compliant with Rule 13 until after more than one year, thus supporting the rejection of the claims.

3. Consistency in Granting Drawback Claims Across Different Commissionerates:
The applicants argued that the Nhava Sheva Commissionerate had granted drawback claims in similar circumstances, and the Pune Commissionerate should follow the same practice. They cited the Supreme Court's decisions in CCE, Navi Mumbai v. Amar Bitumen & Allied Products Pvt. Ltd. and Birla Corporation Ltd., which held that the revenue cannot take different stands in identical cases. However, the government noted that the applicants did not raise this point before the lower authorities and lacked fresh evidence to support this claim. Therefore, the government did not consider this argument.

4. Allowance of Drawback Claims under All Industry Rate Scheme if Brand Rate Claims are Time-barred:
The applicants suggested that even if the brand rate claims were time-barred, the authorities should have allowed the drawback at the All Industry Rate. The Commissioner (Appeals) rejected this submission, stating that there is no provision under the rules to change the drawback claim from the brand rate fixation scheme to the All Industry Rate Scheme suo motu. The government agreed with this interpretation, finding no legal basis to override the applicable statute and circular.

Conclusion:
The government rejected the revision application, finding no merit in the applicants' grounds to exclude the case from the purview of Circular No. 14/2003-Cus. or to consider it under any other provisions of law. The decision of the lower authorities to reject the drawback claims was upheld based on the binding nature of the circular and the proper interpretation of Rule 13. The application was dismissed as devoid of merits.

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