2017 (12) TMI 246 - HC - Customs

Exemption from additional duty u/s 3 of CTA - N/N. 30/2004-CE dated 09.07.2004 - case of Revenue is that appeals have been dismissed as not maintainable on the ground that the assessments were self-assessment and the petitioner has to only file refund claims before the third respondent - Held that - If a Court or Quasi Judicial authority comes to a conclusion that a petition or an appeal is not maintainable, then the concerned Court or Quasi Judicial Authority has to safeguard the interest of the applicant by not foreclosing the remedy available to the applicant. The situation would have been different, if the Commissioner had declined to entertain the appeal in the year 2012 itself for the reason now assigned in the impugned order. This could have very well been done, since the Commissioner is referring to the decision of M/s.Suryalaxmi Cotton Mills Ltd. Vs. CCE, Nagpur, prior to which the amended Section 27 came into force, i.e., on 08.04.2011. Thus, the Commissioner having entertained the appeals and kept the appeals pending for four long years, cannot dismiss by holding that the appeals are not maintainable, but should have protected the petitioner by issuing appropriate consequential direction. This is more so because a party who comes to Court or before Quasi-Judicial Authority cannot be left without a remedy. The period during which the appeals were pending before the first respondent has to be necessarily excluded, because the first respondent has held the appeals to be not maintainable and in other words, the petitioner was prosecuting the claim before a wrong forum. This is all the more reason to issue appropriate directions to enable the petitioner to file a refund claim, which is required to be processed in accordance with law - petition disposed off.

Summary

Issues:
Claim for exemption from payment of additional duty, dismissal of appeals by Customs Authority, maintainability of appeals, delay in disposal of appeal petitions, remedy available to the petitioner, direction to file refund applications, processing of refund applications, limitation period for filing refund claim.

Analysis:
The petitioner, an importer of textile goods, claimed exemption from additional duty under Section 3 of the Customs Tariff Act, 1975, based on a specific notification. However, the Customs Authority rejected this claim, leading to the petitioner paying additional duties and filing appeals before the first respondent. The appeals were dismissed on the grounds that the assessments were self-assessed, and the petitioner should have filed refund claims instead. The court referenced the decision in the case of Priya Blue Industries Ltd. Vs. Commissioner of Customs, stating that a refund claim contrary to the assessment order is not maintainable without the assessment order being modified in appeal or reviewed under the Customs Act, 1962.

The court noted that the appeals were indeed filed by the petitioner before the first respondent in 2012. Even if the relevant decision was not available at that time, the petitioner should have filed refund applications within the prescribed time under Section 27 of the Act. The delay in disposing of the appeal petitions by the first respondent for four years was highlighted, leading to the issuance of an impugned order citing a decision of the CESTAT, Mumbai. The court emphasized that if a judicial authority finds a petition or appeal not maintainable, it must safeguard the applicant's interests by not closing off available remedies.

The court criticized the first respondent for not promptly disposing of the appeals and then dismissing them on maintainability grounds. It emphasized that the Commissioner should have protected the petitioner's rights by issuing appropriate directions instead of simply dismissing the appeals. The court directed the petitioner to file refund applications within 30 days, ensuring that the third respondent processes them on merit without rejecting them on grounds of limitation. The court noted that the dates of filing the refund claim should be considered from when the appeals were first filed before the first respondent.

In conclusion, the court disposed of the writ petitions, issuing directions for filing refund applications within a specified period and ensuring their processing in accordance with the law. The court highlighted the importance of excluding the period during which the appeals were pending from the limitation period for filing refund claims, emphasizing the need to enable the petitioner to pursue their claim effectively.