2022 (8) TMI 342 - HC - Customs

Refund of the security amount once the EODC is issued - non-filing of refund application in the prescribed form - time limit for filing the refund application is six months from the date of clearance of goods - HELD THAT - The petitioner had been bonafide pursuing his claim for refund of bank guarantee which was initially filed to the Commissioner Customs, Chennai within a period of one and a half months from the date of issuance of the EODC. The application was referred back to the petitioner almost after five months later vide letter dated 30.04.2019 conveying that the refund application had to be filed before another officer. The petitioner filed the refund claim application to the concerned officer albeit not in the prescribed format whereafter, it was again returned and was filed afresh in the prescribed format. Therefore, the finding of the respondents Authority that the application for refund was timebarred is totally unwarranted. The petitioner was unquestionably prosecuting his refund claim in a bonafide manner which ought not to have thrown away on hyper-technical objection of not having been filed before the competent authority and/or not having been filed in the prescribed format and finally as being delayed. The concerned authority shall treat the refund application of the petitioner to be within limitation and shall proceed to decide the same as per law within a period of three months from today - Petition allowed.

Summary

Issues:
Challenge to order passed by Deputy Commissioner of Customs regarding refund application timeliness.

Analysis:
The petitioner, a firm, imported capital goods without duty payment under an EPCG license, submitting a bank guarantee. The Customs Department enforced the bank guarantee in 2011. Upon fulfilling export obligations, the petitioner received an Export Obligation Discharge Certificate (EODC) in 2018. The petitioner sought a refund of the security amount within six months of EODC issuance, filing an application in November 2018. However, the application was mistakenly addressed to the Commissioner instead of the proper officer for refunds under the Customs Act.

A series of events followed where the petitioner was directed to file the refund application with the Assistant Commissioner (Refunds) in the prescribed format. Despite compliance, the refund claim was rejected in 2020 as time-barred due to delays in filing. The High Court criticized the Refund Authority's hyper-technical rejection, noting the petitioner's genuine efforts to pursue the refund claim promptly and in good faith.

The Court found the rejection unjustified, emphasizing the petitioner's continuous efforts to rectify any procedural errors and comply with instructions. The Court quashed the impugned communication, directing the authority to consider the refund application as within the limitation period and decide on it within three months. The writ petition was allowed without costs.

In conclusion, the judgment highlights the importance of considering the petitioner's bona fide actions in pursuing the refund claim and criticizes the authority's hyper-technical rejection based on procedural delays. The Court's decision ensures fairness and adherence to legal principles in handling refund applications under the Customs Act.