2022 (9) TMI 67 - AT - Customs

Refund claim - short landing of the goods - duty assessed in the Bill of Entry through self-assessment by the appellant is in excess or not - can a refund be claimed or does the Bill of Entry has to be re-assessed first before refund can be sanctioned - change in the quantity of the goods in the Bill of Entry amount to re-assessment or not - whether documents relied upon by the appellant establish that lesser quantity of goods were imported than the quantity mentioned in the Bill of Lading? HELD THAT - Section 23(1) deals with such cases where the goods which are imported have been lost or destroyed at any time before their clearance for home consumption. No case has been made out by the appellant that the goods have actually been imported as per the Bill of Lading and thereafter they have been destroyed at any time prior to their clearance for home consumption. Therefore, section 23(1) has no application in this case. This is not a case for remission of duty but is a case of application for refund on the ground that duty was paid in excess reckoning the total quantity of goods as mentioned in the Bill of Lading while lesser quantity was actually imported/landed by the vessel. The Bill of Entry, therefore, needs to be re-assessed. Cases of remission of duty under section 23(1), are those where the goods would have been destroyed or lost (other than through pilferage) before their clearance for home consumption. Before the clearance for home consumption, the assessment of the goods under section 17 is still open and the duty can be assessed or re-assessed accordingly. The assessment once completed attains finality and can only be appealed against before the Commissioner (Appeals) or reopened through a notice under section 28. The documents relied upon by the appellant are inconclusive. In respect of MV Vinayak, for instance, the joint draught survey report is signed by the Master of the Vessel and the representatives of the two receivers- the appellant represented by Sravan Shipping Services Pvt. Ltd. and M/s. KPR Fertilisers Ltd. represented by M/s. Coromandel Shipping Agency (P) Ltd. - there is no agreement between the person who was to hand over the goods viz., the master of the vessel and the persons who were to receive them viz., the appellant that there was shortage. The Master says that he delivered the entire quantity and the appellant or his agents or the surveyors appointed by it say that the sulphur was short landed - Similarly, in the case of MV Nirman PRITI, it is indicated at the top that of the 13,200 MT BL quantity of Sulphur, only 13011.771 MT was discharged. The Master of the Vessel s remarks were that the entire quantity was discharged. So, it is a case of word of one versus the word of another. The reports are inconclusive. Therefore, even for this reason, the appellant is not entitled to a refund. The impugned order is correct and calls for no interference - appeal dismissed.

Summary

Issues involved:
- Refund claims rejected by lower authority upheld - appeal filed.
- Questions to be answered in the appeals.

Analysis:
1. The appellant imported sulphur, paid duty, later found lesser quantity delivered, filed refund claims rejected by lower authority. Issue: Can a refund be claimed if duty assessed in Bill of Entry is in excess?
- Appellant argued precedent allowed refunds in similar cases.
- Revenue contended lack of clear evidence for short landing.
- Tribunal analyzed the definition of 'assessment' under the Customs Act, emphasizing the finality of self-assessment unless modified through appeal.

2. Issue: Does a change in the quantity of goods in the Bill of Entry amount to re-assessment?
- Tribunal discussed the comprehensive definition of 'assessment' under the Customs Act post-2018 substitution.
- Highlighted the need for self-assessment modification through appeal for refund sanctioning.

3. Issue: Do the documents establish lesser goods imported than Bill of Lading?
- Tribunal examined conflicting reports on the quantity of goods delivered.
- Emphasized inconclusive nature of documents relied upon by the appellant.

4. Issue: Can the impugned order be sustained considering the above issues?
- Tribunal cited the Supreme Court's ruling in ITC Ltd. case, emphasizing the need for self-assessment modification through appeal for refund sanctioning.
- Concluded that the impugned order was correct due to lack of conclusive evidence and failure to appeal against self-assessment.

5. Tribunal clarified the distinction between remission of duty under section 23 and refund claims based on excess duty paid due to short landing.
- Concluded that the appellant's case did not qualify for remission under section 23 as goods were not proven to be lost or destroyed before clearance for home consumption.

6. Tribunal highlighted the inconclusive nature of reports regarding short landing of goods, emphasizing the conflicting statements between the Master of the Vessel and the appellant's representatives.
- Concluded that the appellant was not entitled to a refund based on the inconclusive nature of the documents.

In conclusion, the Tribunal upheld the impugned order, emphasizing the finality of self-assessment, the need for modification through appeal for refund sanctioning, and the inconclusive nature of the evidence provided by the appellant.