2016 (3) TMI 985 - AT - Customs

Eligibility for benefit of notification no. 56/2008 dated 29/04/2008 and notification no. 21/2002 - EDI system which is operational into the customs was not updated to extend benefit of notification 56/2008 to the product imported - Respondent sought amendment to bills of entry as per the provisions of section 149 and/or 154 of the Customs Act, 1962 which was not responded to - Held that - eligible benefit of the notification could not be extended to assessee due to an error and non updation of the program in the EDI system, cannot be held against an assessee, only on the ground that they had not challenged the assessment for the bills of entry. This would deny legitimate benefit available to an assessee and more so when the assessee, had sought the amendment of bills entry as per the provisions of Customs Act, 1962. Therefore, the respondent is eligible for the benefit of above notification followed by the decision of Tribunal in the case of Oswal Agloimpex Pvt. Ltd. 2012 (10) TMI 170 - CESTAT, AHMEDABAD . - Decided against the revenue

Summary

Issues:
Refund of Customs Duty paid in excess due to non-extension of benefit of notifications.

Analysis:
The appeal pertains to a dispute over the refund of Customs Duty paid in excess by the respondent due to the non-extension of the benefit of certain notifications. The respondent had filed two bills of entry for the import of feroniodium, claiming benefits under notification no. 56/2008 and 21/2002. However, the benefit was not extended by the assessing officer due to the EDI system's failure to upgrade. The respondent sought amendment under sections 149 and/or 154 of the Customs Act, 1962, to correct the errors in the EDI bill of entry, but no action was taken by the department. The refund claim was initially rejected based on judgments of the Supreme Court in prior cases.

Upon appeal, the first appellate authority set aside the rejection and extended the benefit of the notifications to the respondent. The revenue challenged the decision on the grounds that the respondent did not challenge the assessment of the bills of entry and paid the duty without contest, invoking the Supreme Court judgments. However, the respondent argued that their application for correction in the bills of entry was not considered, and they were indeed eligible for the benefit of the notifications, citing relevant tribunal judgments.

The Tribunal found that the respondent was eligible for the benefits under the notifications, and the failure to extend the benefit was due to the operational error in the EDI system. The Tribunal emphasized that the respondent had sought amendments to the bills of entry under the Customs Act, which were not addressed by the department. Thus, denying the legitimate benefit to the assessee solely on the ground of not challenging the assessment would be unfair. The Tribunal agreed with the respondent's contention and held that the decision in favor of the respondent was supported by the tribunal's previous judgments.

In conclusion, the Tribunal upheld the first appellate authority's decision, stating that the impugned order was correct and legal, without any infirmity. The appeal by the revenue was rejected, affirming the eligibility of the respondent for the benefit of the notifications.