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2014 (8) TMI 395 - AT - CustomsDenial of refund claim of cess paid - Exemption of cess under Notification No. 451/2001 dated 30.6.2001 for payment of cess on export of marine products by the EOUs and the units in the Export Processing Zones and Special Economic Zones - Held that - refund claim was filed on the basis of the exemption Notification No. 451/2001 dated 30.6.2001 which would be governed by Section 27 of the Customs Act, 1962. Accordingly, both the authorities below had rightly rejected the refund claim on the ground of time limit and unjust enrichment. However, there is a subsequent development in this matter as decided by Hon ble High Court and the Tribunal that Prawns and Shrimps are not fish and is not covered to the Schedule of the said Cess Act, 1940. In my considered view, this issue should be examined by the lower authority in the interest of justice - Following decision of COMMISSIONER OF CUSTOMS, TUTICORIN Versus EDHAYAM FROZEN FOODS 2008 (7) TMI 117 - HIGH COURT MADRAS - Matter remanded back - Decided in favour of assessee.
Issues:
1. Refund claim rejection on grounds of limitation and unjust enrichment. 2. Interpretation of the Schedule of the Agricultural Produce Cess Act, 1940 regarding prawns and shrimps. 3. Applicability of Section 27 of the Customs Act, 1962 on refund claims. Analysis: Issue 1: Refund claim rejection on grounds of limitation and unjust enrichment The appellant, a 100% EOU, exported shrimps under 78 Shipping Bills in 2001-02 and paid cess under the Agricultural Produce Cess Act, 1940. The refund claim of Rs. 32,97,617/- against the Shipping Bills was rejected by the adjudicating authority citing limitation under Section 27(1)(b) of the Customs Act, 1962 and unjust enrichment. The Commissioner (Appeals) upheld the rejection. However, the appellant argued a subsequent development where it was established that prawns and shrimps are not categorized as fish under the Act, which could impact the refund claim. Issue 2: Interpretation of the Schedule of the Agricultural Produce Cess Act, 1940 regarding prawns and shrimps The appellant contended that prawns are not mentioned in the Schedule of the Cess Act, 1940, and thus, the provisions of the Customs Act related to refunds, including Section 27, should not apply to prawn exports. This argument was supported by legal precedents highlighting the distinction between fish and prawns/shrimps. The appellant urged the lower authority to reexamine this issue, emphasizing that it was not raised before the previous authorities. Issue 3: Applicability of Section 27 of the Customs Act, 1962 on refund claims The Revenue, opposing the appellant's plea, argued that the refund claim was based on an exemption notification and thus fell under the purview of Section 27 of the Customs Act. They emphasized that the limitation prescribed under the Customs Act was binding on departmental authorities. Citing various Supreme Court and Tribunal decisions, the Revenue contended that any refund claim filed before customs officers would be covered by Section 27. In the final judgment, the Tribunal agreed with the Revenue's argument, upholding the rejection of the refund claim based on time limits and unjust enrichment. However, recognizing the evolving interpretation regarding prawns and shrimps not being classified as fish under the Cess Act, the Tribunal directed the lower authority to reexamine the refund claim in light of this development, ensuring a fair hearing for the appellant.
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