2016 (6) TMI 394 - AT - Customs

Refund - Period of limitation - Short shipment of goods which has not been imported - Provision of Section 27 is not applicable - Held that - it is found that the appellant have admittedly paid the Customs duty only after import and verification it was found that there is a short shipment of the goods. However even though there is a short shipment but the amount paid by the importer/appellant is admittedly as a Customs duty only. Only for the reason that the goods were not imported the nature of the amount paid as duty will not stand altered therefore whatever duty was paid by the appellant is a Customs duty only. Therefore the refund of such Customs duty in my considered view is governed by Section 27 of the Customs Act which is the only provision which deals with refund of duty refundable. Since the amount claimed as refund by the appellant can be refunded only under Section 27 of the Act the limitation provided in the said Section shall also apply for sanction of refund. There is no other provision for refund of Customs duty except under Section 27 of the Act therefore limitation is applicable. However on the issue of limitation for the purpose of refund the Hon ble Supreme Court in the various judgments categorically held that for refund of any amount the statutory time limit provided under the Customs/Central Excise Act has to be followed mandatorily. Therefore this issue has been clearly settled by the Hon ble Supreme Court that even though the refund of duty recovered without authority of law but for the refund claims made before the departmental authorities limitation provided under the Customs Act/Central Excise Act or Rules made there under is applicable. The authorities functioning under the Act bound by its provision. Therefore since refund of any amount is covered by Section 27 and there is no other provision this Tribunal being a creature under the Central Excise/Customs Act cannot go beyond the statute and therefore cannot relax the time limitation provided under the statute. As per my above discussion and settled legal position the refund claim being filed after 6 month is hit by limitation and therefore correctly rejected by the lower authority. The impugned order is upheld. - Decided against the appellant

Summary

Issues:
1. Refund claim for short shipment of goods beyond prescribed period.
2. Applicability of Section 27 of Customs Act for refund.
3. Interpretation of "duty" under Customs Act for refund claims.
4. Validity of refund claim filed after the stipulated time limit.
5. Precedents regarding limitation for refund claims.

Analysis:
1. The appeal concerned a refund claim for short shipment of goods beyond the prescribed period of 6 months under Section 27 of the Customs Act, 1962. The appellant filed the refund claim after paying duty on the goods, which were not imported, leading to rejection by the lower authorities due to being time-barred.

2. The main contention revolved around the applicability of Section 27 for refund claims. The appellant argued that since the goods were not imported, the amount paid should be considered as an advance deposit and not as duty, hence Section 27 should not apply. However, the Revenue contended that the amount paid was indeed Customs duty, and as per Section 27, refund of duty must adhere to the stipulated time limit.

3. The interpretation of "duty" under the Customs Act was crucial. The Tribunal emphasized that even though there was a short shipment, the amount paid by the appellant was considered as Customs duty. It was highlighted that regardless of the goods not being imported, the nature of the payment as duty remained unchanged, making it eligible for refund under Section 27.

4. The validity of the refund claim filed after the stipulated time limit was a key factor in the judgment. The Tribunal upheld the lower authorities' decision, stating that the appellant's claim was correctly rejected due to being time-barred, as the limitation under Section 27 applied to the refund of Customs duty.

5. Precedents and legal guidelines were cited to support the decision regarding the limitation for refund claims. Various judgments, including those of the Hon'ble Supreme Court and High Courts, emphasized the mandatory adherence to the statutory time limits prescribed under the Customs Act for refund claims, reinforcing the importance of following the provisions strictly.

In conclusion, the Tribunal dismissed the appeal, affirming that the refund claim filed after 6 months was rightfully rejected due to being time-barred under Section 27 of the Customs Act. The judgment highlighted the significance of interpreting "duty" for refund purposes and the necessity of adhering to statutory time limits for refund claims as per established legal precedents.