2016 (11) TMI 852 - AT - Customs

Rejection of refund claim - Entitlement to the benefit of exemption from payment of customs duty under Notification No.24/2005-Cus. dated 1.3.2005 - The customs authorities rejected the refund claims for the reason that on the basis of the duty exemption certificate, the bills of entry cannot be reassessed in terms of Section 149 of the Customs Act, since the Section does not allow amendments to bill of entry on the basis of documentary evidence which was not in existence at the time the goods were cleared. Since the duty exemption certificate was obtained subsequent to the dates of clearance, they took the view that the bills of entry cannot be amended and consequently the benefit of the notification cannot be extended - whether the rejection of refund claim justified? Held that - the substantial benefit cannot be denied to the assessee. Subsequent to the dates of import, all the procedural requirements have been satisfied. Since the requirement of re-assessment has been done away with by amending Section 27, and the imports have been made after this date, we are of the view that the assessee is entitled to the refunds on merits. However, before grant of such refunds, the other requirements of Section 27 needs to be looked into and subject to the satisfaction only the refunds can be paid - We consider it appropriate to remand the case back to the original authorities with a direction to consider the duty concession certificates produced by the assessee without insisting on the requirement for re-assessment under Section 149. The assessee s claim for refund may be validated under Section 27 and paid to them Appeal allowed by way of refund.

Summary

Issues:
1. Rejection of refund claims based on reassessment under Section 149 of the Customs Act.
2. Interpretation of amended Section 27 of the Customs Act regarding the requirement of reassessment for granting refunds.
3. Entitlement of the appellant to the benefit of exemption under Notification No.24/2005-Cus.
4. Consideration of procedural requirements and certificates obtained by the appellant for claiming refunds.
5. Review of the rejection of refund claims by customs authorities and the Commissioner (A).

The judgment deals with an appeal against the rejection of refund claims by the Commissioner (A) concerning the import of goods for the manufacture of tablet PCs under Notification No.24/2005-Cus. The appellant imported goods without following the prescribed procedures for duty exemption, paid customs duty, and later obtained necessary certificates for claiming refunds. The customs authorities rejected the claims citing Section 149, which prohibits reassessment based on subsequently obtained documents. The appellant argued that post-amendment to Section 27, reassessment is not mandatory for refunds. The Tribunal observed that the appellant met all procedural requirements after import and is entitled to refunds under the notification. The Tribunal found the rejection unjustified as the objection was not raised earlier. The Tribunal highlighted that the amendment to Section 27 eliminates the need for reassessment and the appellant should receive refunds based on merit. Therefore, the case was remanded to consider the duty concession certificates without insisting on reassessment under Section 149, validating the refund claims under Section 27.

The main issue addressed was the rejection of refund claims by customs authorities based on the inability to reassess bills of entry under Section 149 due to subsequently obtained duty exemption certificates. The appellant contended that post-amendment to Section 27, reassessment is not a prerequisite for granting refunds. The Tribunal agreed that the appellant, who imported goods for tablet PC manufacture, fulfilled procedural requirements post-import and deserved refunds under the notification. The Tribunal noted that the objection to reassessment was not raised earlier and found the rejection unjustified. Emphasizing the amendment to Section 27, the Tribunal directed the authorities to consider the duty concession certificates without insisting on reassessment under Section 149, allowing the appellant's refund claims under Section 27.

The judgment revolved around the rejection of refund claims by customs authorities for imported goods meant for tablet PC manufacture under Notification No.24/2005-Cus. The appellant failed to follow prescribed procedures for duty exemption at import, paid customs duty, and later obtained necessary certificates for refunds. Customs authorities rejected claims citing Section 149, barring reassessment based on subsequently obtained documents. The appellant argued that post-amendment to Section 27, reassessment is unnecessary for refunds. The Tribunal found the rejection baseless, as the appellant met procedural requirements post-import. Noting the amendment to Section 27, the Tribunal directed authorities to consider duty concession certificates without requiring reassessment under Section 149, validating the refund claims under Section 27 and remanding the case for further review.