2018 (8) TMI 336 - AT - Customs

SEZ Unit - Jurisdiction of Commissioner of Customs (Appeals) NCH Mumbai - rejection of refund claim - duty paid under protest - refund claim returned on the ground that differential duty was paid vide challan raised at Vishakhapatnam and instructed the appellant to file refund claim before the appropriate authority of SEZ Chippada and not in the NCH Mumbai. Held that - The Board circular dated 03.02.1996 is applicable to the appellant since evaporation and other natural causes might have caused such loss in transit. Therefore it has nothing to do with SEZ unit. Further the goods were imported to Mumbai port and warehoused there for which Mumbai customs port as defined in Rule 2 of Regulation 1995 should be considered as the port of import. Any subsequent transit of goods are of inland transit for which further submission of bill of entry at Vishakhapatnam was uncalled for - This being the factual position the finding of Asst. Commissioner Import Mumbai to refuse refund claim on grounds of jurisdiction holding that the Mumbai customs have no authority is erroneous and such finding should not have found support of the Commissioner (Appeals) in his order. More importantly the amended Rule 47(5) brought by the department of commerce vide Notification dated 05.08.2016 has not excluded the jurisdiction of the Commissioner of Customs in respect of refund case - in the instant case there is no denial of the fact that the Asst. Commissioner Customs-Bond Mumbai is appropriate authority since he has got jurisdiction over customs port i.e. Mumbai where imports have taken place. The Asst. Commissioner of Customs- bond Mumbai has the jurisdiction to decide the refund application - appeal allowed - the matter is remanded back to the adjudicating authority to dispose of the refund application of the appellant already filed before it.

Summary

Issues:
Refusal of refund claim jurisdiction by Asstt. Commissioner of Customs challenged before appellate Tribunal.

Analysis:
1. The appellant, a SEZ unit, imported goods through Mumbai port for its manufacturing process. The Asst. Commissioner demanded differential customs duty due to a shortage of goods noted during assessment. The appellant paid the duty under protest and sought a refund as the shortage was within the permissible limit according to a CBEC circular. The Asst. Commissioner returned the refund claim, directing the appellant to file it before the SEZ authority in Vishakhapatnam.

2. The appellant, relying on a Gujarat High Court decision, requested the Asst. Commissioner to reconsider the refund claim and also approached the Asst. Commissioner of Customs in Chippada. Both requests were denied, citing rules on refund applications. The Commissioner of Customs, Mumbai directed the appellant to resubmit the claim before the appropriate customs authority. The appellant appealed this decision before the Tribunal, arguing that the Asst. Commissioner in Mumbai was the proper officer for the refund claim.

3. During the appeal, the appellant's counsel argued that the Asst. Commissioner's refusal to entertain the refund application was incorrect, given the actions taken by the customs authorities at Mumbai port. The counsel contended that the Mumbai Customs House had jurisdiction over the matter, not the authority in Vishakhapatnam. The appellant sought the Tribunal's intervention instead of complying with the direction to file the claim before the SEZ jurisdictional officer.

4. The department's representative argued that prior to a specific amendment, no provision for refund existed for SEZ units. Refund applications were to be made to the Asst. Commissioner having jurisdiction over the customs port where goods were released. As the goods were released at Vishakhapatnam port, the Mumbai Customs port had no jurisdiction over the claim, and the appeal should be rejected.

5. After hearing both sides and reviewing the case record, rules, and relevant circulars, the Tribunal found that the refund claim was related to goods released at Vishakhapatnam and the payment made under protest. The Board circular applied to the appellant's situation, and the Mumbai Customs port should be considered the port of import. The Asst. Commissioner's decision to refuse the claim based on jurisdiction was deemed erroneous, and the Tribunal held that the Mumbai Customs officer had the authority to decide on the refund application.

6. Consequently, the Tribunal allowed the appeal and remanded the matter back to the adjudicating authority to process the appellant's refund application.