2023 (10) TMI 178 - AT - Customs

Condonation of delay in filing refund claim - condonation sought on the ground that refund claim filed in a wrong jurisdiction - HELD THAT - If the refund of duty paid was filed by an assessee in the wrong jurisdiction before an authority who not competent to entertain the refund claim, that too within the time limit, the said authority must transfer the application for refund claim to the competent authority, as has been correctly done in this case. As rightly held in the impugned order, the period during which the claim remained with the wrong jurisdictional authority should not be considered for calculating the time limit. The Hon'ble Apex Court in The State of Jharkhand and others v. Brahmaputra Metallics Ltd and others 2020 (12) TMI 1241 - SUPREME COURT held that a decision taken in an arbitrary manner contradicts the principle of legitimate expectation. An authority is under a legal obligation to exercise the power reasonably and in good faith to effectuate the purpose for which power stood conferred. Rejecting the refund claim simply on the ground of delay in filing the claim before the proper authority while admitting that the appellant had filed the claim before the department on time, albeit at a wrong jurisdiction cannot be approved - Appeal dismissed.

Summary

Issues involved:
The issues involved in this case are related to the rejection of refund claims by the Assistant Commissioner of Customs on the grounds of delay in filing the claims and jurisdictional issues.

Jurisdictional Issue:
The case involved a dispute regarding the jurisdiction of filing refund claims by the importer. The importer had initially filed refund claims before the Commissioner of Customs, Import & General, New Delhi, which were later forwarded to the Deputy Commissioner of Customs (Refunds), Air Commissionerate, Chennai. The Assistant Commissioner of Customs rejected the claims, stating they were filed after the expiry of one year and in contravention of specific notifications.

Legal Position on Jurisdiction:
The Revenue contended that filing a refund claim in a wrong jurisdiction cannot be condoned, emphasizing the importance of filing claims before the correct jurisdictional authority. However, the Tribunal referred to legal precedents emphasizing the need for a liberal interpretation of procedural requirements to ensure the benefit is not defeated. The Tribunal highlighted the obligation of authorities to transfer applications to the competent authority when filed in the wrong jurisdiction.

Decision and Rationale:
The Tribunal upheld the decision of the lower appellate authority, which directed the adjudicating authority to process the claim without insisting on the aspect of limitation. The Tribunal agreed with the lower authority's decision based on the legal position and cited judgments supporting a liberal interpretation of procedural requirements. It was emphasized that rejecting the refund claim solely based on the delay in filing before the proper authority, when the claim was filed on time before the department albeit in the wrong jurisdiction, was not justified.

Final Verdict:
The Tribunal concluded that the lower authority was correct in its decision, and the appeal by the Revenue was dismissed. As no other issues were raised and considerable time had elapsed, the Tribunal directed the expeditious sanctioning of the refund as per the law.

Separate Judgment:
The judgment was delivered by Hon'ble Mr. M. Ajit Kumar, Member (Technical) of the Appellate Tribunal CESTAT Chennai.