2023 (10) TMI 76 - AT - Customs

Validity of assessment order - refund of BES - rejection on the ground that claim is pre-mature - appeal pending before the Tribunal - HELD THAT - The refund was claimed within the prescribed time but, the appeal against rejection of claim was rejected by the Court below, on the grounds that since the appeal on merits was pending before this Tribunal, it was premature - the appeal of the assessee have been finally allowed in their favour in RASHTRIYA CHEMICALS FERTILIZERS LTD VERSUS CC ST, VISAKHAPATNAM CUS 2019 (1) TMI 2032 - CESTAT HYDERABAD , wherein, it had been held that CVD was chargeable at 1% and not 5%, by following rulings of Supreme Court in the case of M/S SRF LTD., M/S ITC LTD VERSUS COMMISSIONER OF CUSTOMS, CHENNAI, COMMISSIONER OF CUSTOMS (IMPORT AND GENERAL) , NEW DELHI 2015 (4) TMI 561 - SUPREME COURT . If the argument of the Revenue is accepted, it will amount to miscarriage of justice in as much as the original refund application filed was admittedly within the time limit prescribed under the Act. Further, when the refund was rejected on merits, which in appeal, was dismissed as pre-mature on the grounds that appeal on merits was pending before Tribunal and when the Tribunal finally decided the appeal on merits, the refund is now being proposed to be denied on the grounds that it was not filed within the prescribed time limit. When the grounds for considering the appeal was the pendency of the appeal before the Tribunal, the Order of the Commissioner (Appeals) dismissing the appeal as pre-mature would not tantamount to the rejection of the original application filed before the Original Authority, which was admittedly within the time limit. Therefore, the original claim of refund has to be decided on merits considering it filed within the time limit without denying on the grounds of limitation, in the facts of the case. Matter remanded to the Original Adjudicating Authority to consider and allow refunds - appeal allowed by way of remand.

Summary

Issues involved:
The issues involved in the judgment are the correct assessment of duty on the import of Muriate of Potash, the rejection of refund claim by the Deputy Commissioner of Customs, and the subsequent appeal challenging the assessment order.

Assessment of Duty:
The appellant imported Muriate of Potash and claimed that the Countervailing Duty (CVD) applicable was 1%, not 5% as assessed. The appellant filed a refund claim for the excess amount paid towards CVD, which was rejected by the Deputy Commissioner of Customs. The Commissioner (Appeals) also rejected the appeal for refund as premature, based on the pending appeal before the Tribunal. However, the Tribunal, following the Supreme Court judgment, held that the appellant was entitled to the benefit of the exemption notifications and should be refunded the excess duty paid.

Refund Claim and Limitation:
The appellant faced challenges in obtaining the refund following the Tribunal's decision in their favor. The Revenue argued that since the final order was passed, the appellant should have filed a fresh refund application within the prescribed one-year period. The Tribunal noted that the original refund claim was filed within the time limit, but the appeal was rejected as premature due to the pending appeal on merits. Denying the refund based on a time limitation argument would result in a miscarriage of justice. Therefore, the Tribunal allowed the appeal partly, setting aside the impugned order, and remanded the matter to the Original Adjudicating Authority to consider and allow refunds on merits, without denying them on the grounds of limitation.

Decision and Direction:
The Tribunal allowed the appeal by way of remand, directing the authority to dispose of the matter by way of a Speaking Order within one month from the date of receipt of the order. The decision was made in consideration of the original refund claim being filed within the prescribed time limit and the need to ensure justice in the case.