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2020 (1) TMI 206 - AT - CustomsNon-speaking order - Refund of the differential duty - section 27 of the Customs Act, 1962 - rejection of refund mainly on the ground that the bills of entries has not been challenged - HELD THAT - In view of the ratio of the judgment of Hon ble Larger Bench of the Apex Court in the case of ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV 2019 (9) TMI 802 - SUPREME COURT , the appeal is liable to be rejected. If the appellant s bills of entries have been reassessed and they sought speaking orders which have not been issued to them or the request for issue of speaking orders is rejected by the lower authority that itself becomes a decision by the lower authority which can be appealed against to the Commissioner before the Commissioner (Appeals). However, by not issuing the speaking orders or giving any reply to their requests for speaking order, the officer has denied the appellant their legitimate right to challenge the reassessments. The assessing officer are directed to issue speaking orders as sought by the appellant in cases where the Bills of Entry were re-assessed. This will enable the appellants to understand the reasons for re-assessment and if aggrieved, challenge such re-assessments - appeal dismissed.
Issues:
Classification of goods for customs duty, eligibility for exemption notification, denial of refund claims, requirement of speaking orders for reassessment, validity of refund claims without challenging assessment. Classification of Goods for Customs Duty: The appellant imported Magnesia Carbon Brick and classified them under 6902 10 40 to claim exemption under Notification No. 12/2012-Cus. However, the Revenue re-classified the goods under 6815 99 90, attracting a higher customs duty rate. The appellant paid the higher duty but sought justification for revision of classification and exemption denial. Despite no speaking orders issued, refund claims were rejected, leading to the current appeal. Eligibility for Exemption Notification: The appellant argued that post-08.04.2011, changes in assessment procedures allowed filing refund claims without challenging the assessment order. Citing precedents like Aman Medical Products and Micromax Informatics Ltd., the appellant contended that refund claims could be made without challenging the assessment, especially in cases of self-assessment. However, the Revenue maintained that refund cannot be sanctioned unless the assessment is appealed against, as per the judgment in ITC Ltd. Denial of Refund Claims: The First Appellate Authority rejected the refund claims based on the principle that refund cannot be granted without challenging the underlying assessment. Citing Priya Blue Industries and Flock India judgments, the Authority held that the officer processing refunds cannot review the assessment done by the competent officer unless modified through appeal. Requirement of Speaking Orders for Reassessment: The appellant argued that the denial of speaking orders deprived them of understanding the basis for reassessment, hindering their ability to appeal. Referring to the case of Fairway Trading Company, the appellant emphasized the importance of speaking orders for proper recourse to appeal procedures. Validity of Refund Claims Without Challenging Assessment: The Tribunal upheld the rejection of refund claims, citing the judgment in ITC Ltd. The Tribunal emphasized that refund claims, even in cases of self-assessment, cannot be sanctioned unless the assessment is challenged. The Tribunal directed the assessing officer to issue speaking orders for reassessed bills of entry within four weeks to enable the appellant to understand and challenge the reassessments, ensuring justice and proper appeal procedures. This detailed analysis covers the issues of classification of goods for customs duty, eligibility for exemption notification, denial of refund claims, requirement of speaking orders for reassessment, and the validity of refund claims without challenging assessment, as addressed in the Appellate Tribunal CESTAT HYDERABAD's judgment.
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