Creation of Centralized Refund Section & Streamlining the procedure thereof-reg. - Customs - 41/2007

OFFICE OF THE COMMISSIONER OF CUSTOMS (EXPORT PROMOTION) NEW CUSTOM HOUSE, BALLARD ESTATE, MUMBAI-400001 F. No. S/16-942/2007 GR.VII Date: 25.09.2007 Public Notice No. 041/2007 Subject: Creation of Centralized Refund Section Streamlining the procedure thereof-reg. Attention of the members of the trade including Importers/Exporters and Custom House Agents is invited to the requirements for Creation of Centralized Refund Section Streamlining the procedure thereof. In order to ensure expeditious disposal of Customs Duty refund Applications and to enhance transparency in refund disbursement, all refund claims will stand centralized with Refund section group VII at Export Commissionerate of Customs New Custom House, Mumbai w.e.f. 01.10.2007. The claims pending with Group VII till 30.09.2007 shall be finalized by the respective Section only and in no case the pending files received before 30.09.2007 shall be transferred to the Refund Section Group VII. All refund claims filed after 01.10.2007 shall be dealt as under:- 2 All refunds under Section 27 of the custom Act, 1962 including consequential refunds arising out of orders passed by an Appellate Authority as well as the pre-deposits of amounts deposited during the pendency of appeals and other deposits shall be dealt by the Refund Section. The following types of refund claims only will continue to be handled by the AC/Dc of respective section as shown below: (1) Refund relating to 100% EOU AC/DC 100% EOU (2) Refund of B.G encashed and others with DEEC monitoring cell AC/DC Monitoring Cell (3) Refund related to Drawback AC/DC Drawback (4) Refund related to Export section AC/DC Export (5) Refund arising in EPCG department AC/DC EPCG 3. All claims should be filed in the form and manner prescribed under customs Refund Application (Form) regulations, 1965. All claims should be addressed to DC/AC Refund Section Group VII and deposited/filed in the Refund Section Group VII Section. 4. The Refund Section Group VII shall comprise an AO, an Examiner/ACAO and one TA. The work shall be supervised by an AC/DC. All the refund applications made by any person whether by post or courier or personal delivery, shall be received by the group VII Section and a simple receipt, for having received the application that is said to be have been filed as Refund application shall be issued immediately. At this Stage, the receipt should make it clear that the application has not been scrutinized for its completeness. All the applications so received will be given a running Serial Number for each financial year and acknowledgement will be given by the Receipt Clerk (TA) after verifying that whatever has been stated in the application has in fact been annexed to the application. Thereafter, Refund Application details shall be entered in a Register. The running Serial Number given on the application and the register shall be the same and shall bear the dated initials along with rubber stamp indicating the name of the TA, who has received the Refund claim. In case of receipt of Refund Application by post, the same procedure shall be followed. Application of refund found to be complete in all respects, after scrutiny as above, shall be processed on first-come-first served basis so as to decide whether the whole or any part of the duty and interest paid by the applicant is refundable. 5. On receipt of refund application, the TA shall open a file and put up the same to the Examiner/ACAO for initial scrutiny. The Examiner/ACAO shall scrutinize the claim for its completeness. If the application is found to be complete in all respects, he shall prepare acknowledgement in the prescribed format as per Regulation 2(2) of Customs Refund Application (Form) Regulations, 1995. The AO shall re-check whether all documents have been received with the refund application and then he shall sign the acknowledgement memo. The TA shall immediately dispatch the acknowledgement memo, to the concerned Importer/Agent by Regd. A.D. post. If the application is found to be incomplete, the Examiner/ACAO shall put up the deficiency memo, as per Regulation 2(3) to the AO. The AO shall re-check whether all documents required have been mentioned in the deficiency memo and then he shall sign the memo. The TA shall issue the deficiency memo by Regd. A.D. post. The acknowledge memo/deficiency memo shall bear the same Sr. No. and date of receipt of the Refund Claim. All the acknowledgement and deficiency memos shall be issued within the 10 working days of the receipt of the refund application. 6. File will be forwarded to the EO/ACAO by Refund Section (TA) as soon as the party replies to the Deficiency Memo. Revised application number with date of receipt will be mentioned in the file as well as in Register maintained. Revised application should be entered by TA as fresh claim due to the fact that the relevant date for granting interest on refund amount is the date when refund application complete in all respects, is submitted. However, for the purpose of reference, entry may also be made in the register against previous entry. 7. In case, where the claimant has replied to the Deficiency Memo, the revised application so forwarded will be scrutinized by the Examiner/ACAO. If it is found that Deficiency memo earlier issued has not been fully complied with, the refund application will again be returned to the claimant. In case, it is found to be complete in all respect then acknowledgement will be issued to the claimant. The procedure as state earlier should be followed. 8. The TA (Refund) on receipt of Application duly acknowledged to the claimant to be complete will issue requisition slip and call for original B s/E from other departments viz; MCD, Bond, IAD, Statistics, EDI etc. Documents so requisitioned will be furnished within 3 working days of the requisition. The concerned Section should make all possible efforts to trace the B s/E and forward the same. In case, the said documents are not traceable, the concerned Section shall make an endorsement to that effect in the requisition slip so that the refund claim may be finalized on merits without further awaiting the said documents. If the said documents are not forthcoming within 3 days, and no reply is received from the sections from where the documents were requisitioned, it shall be construed that documents are not available with them and in case of any contradiction at a later date, the responsibility shall lie on the Section from where such documents were requisitioned. The refund should generally be not entertained without original triplicate B/E filed by the claimant. Only in case where party produces evidence to the effect that triplicate B/E was given to the department and has been lost in the Deptt., claim may be processed on the basis of photocopy of triplicate B/E or quadruplicate B/E against an indemnity bond to be executed by the party. 9. When on requisition, original or reconstructed B s/E have been forwarded within the stipulated time, the TA will forwarded the file to the Accounts Section for No payment Certificate (NPC). Accounts Department will verify the CBR Cus 44 Register and state whether or not any refund has earlier been granted against particular Cash Number. This should be returned within 2 working days. Refund TA will keep records of movement of file in refund Register. 10. After the file has been received back by the Refund section from Accounts Section, TA will forward the file to the Examiner/ACAO to process the claim. The examiner/ACAO will evaluate the merits of the claim and put up the file to A.O. with a self-explanatory note. The AO will examine the claim and with his comments will forward the same to DC/AC (Refund) for sanction or otherwise. Before sanctioning the Refund, DC/AC (Refund) shall verify form the TAR Cell if any confirmed demand is pending for recovery form importer. The file where the refund is proposed to be sanctioned will be forwarded to comptist who will compute the exact amount of refund and will return the file immediately to the Refund Section, but not later than one working day. If the confirmed demand free from restraint is pending for recovery from the importer, the amount of demand can be adjusted from the total refund payable. In all the cases where refund is proposed to be sanctioned wherein duty involved in ₹ 5 lakhs or more, shall forwarded to Audit Section for the purpose of pre-audit alongwith the draft Order-in-Original of refund. The Audit Cell, shall examine the refund claim and draft Order-in-Original and put up to the competent authority for pre-audit. The file would be returned after pre-audit to the refund section within five working days. After the file is returned from Audit, after pre-audit of claim, the refund should be sanctioned or otherwise by a speaking appeallable order. Whenever, refund is rejected, Order-inOriginal of rejection should be issued or dispatched to the claimant. Further, in respect of the provisions of unjust enrichment, the order should indicate that this aspect has been examined based on the guidelines, if any, applicable, the order should also contain the finding adjudicating authority on the documents produced in support of the claim and basis for determining the amount as either refundable to the claimant or payable to the Consumer Welfare Fund or the claim not being admissible. The TA will prepare the Refund Order and put up to AC/DC for signature and issue to the claimant. The claimant shall produce the pre-receipted RO to the CAO/ACAO on the basis of which he will sign the cheque. 11. The file where refund has been sanctioned will be forwarded to the Accounts Department who will keep a note of the refund sanctioned in CBR 44 Register and give a certificate in the file to this effect. All files received in Accounts Department for this purpose must be returned to Refund Section within 2 days. 12. After issuance of Order-in-Original/Refund Order, all the files with refund claim less than ₹ 5 Lakhs should be sent to post-audit for completing post-audit formalities. In case where refund claim is less than ₹ 50,000/-, the AC/DC (Audit) may select 25% of such cases at random for post audit . The post audit should be done at the level of AC/DC Audit. If there is a conflict between AC (Refund) and AC (Audit) the files should be put to JC/ADC (Audit). All refund files should be kept in safe custody in Refund section of group VII. 13. Where the refund application has been admitted, whether in part or in full, and claimant is eligible for refund, the A/DC may ensure that payment is made to the party within 3 days of the order passed after due audit, if any. In all such cases refund of amount shall be paid by a crossed cheque on the authorized bank with which the sanctioning authority maintains account in favour of the applicant and not in favour of Agent or Advocate. After the cheque has been signed, it shall either be delivered to the claimant or his authorized representative personally when he next calls for it or sent to him by Registered Post Acknowledgement Due at Government cost, on the basis of prereceipt already obtained form the claimant. 14. Finalization of refund claims, lodged by importers and exporters is a quasijudicial function and is required to be followed up by issuance of a speaking appellate order. In view of this, DC/AC (Refund) shall issue a speaking order positively within Ten days of finalizing the refund claims and endorse a copy of the order to the DC/AC (Review). Dc/AC (Review), on receipt of such order shall after due examination, put up the same to the Commissioner for review and passing orders as deemed fit. (K. ANANTA PADMANABHAN) COMMISSIONER OF CUSTOMS EXPORT