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TMI Blog2012 (10) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... - F. Nos. 195/187-189/2010-RA, 198/67/2009-RA and 198/47/2009-RA - 1239-1243/2011-CX - Dated:- 21-9-2011 - Shri D.P. Singh, J. REPRESENTED BY : S/Shri B. Lakshi Narsimhan, Advocate and Arvind Bhansali, Sr. Vice-President, for the Assessee. Shri Tapen Kumar, Assistant Commissioner, for the Department. [Order]. These revision applications have been filed by the applicant manufacturer exporter M/s. Reliance Industries Ltd., Barabanki and applicant Commissioner, Central Excise, Mumbai against orders-in-appeal No. as mentioned at Column No. 3 6 of the Table respectively passed by the Commissioner (Appeals) Central Excise, LTU Mumbai. The details of revision applications filed by both applicants are as under : TABLE Sl. No. RA No./Applicant Respondent Order-in-Appeal 1. 195/187-189/09 M/s. Reliance Industries Ltd., Barabanki, UP C.C.E. LTU Mumbai SB/18/LTU/Mumbai/09 dated 12-10-09 passed by Commissioner of Central Excise (Appeals), LTU. Mumbai 2. 198/47/09 C.C.E. LTU Mumbai M/s. Reliance Industries Ltd., Barabanki, UP 180-190/CE/LKO/08 dated 26-11-08 passed by Commissioner of Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty filed rebate claims alongwith all the relevant documents in terms of Notification No. 19/04-C.E. (N.T.), dated 6-9-04. The claimed were returned back to the party on different dates because stamp of Customs Seal given on Shipping Bill was found missing in Bill of Lading/Mate Receipt. Party arranged the stamp of Superintendent Customs but could [not] give any explanation w.r.t. missing custom seal of other documents. Assistant Commissioner Customs also informed vide letter dated 30-4-08 that there is no uniform practice of putting customs seal on each document. Party submitted undertaking dated 12-5-08 to submit BRC. Accordingly, ACCE Division II Lucknow sanctioned all the rebate claims without interest as the rebate claims were sanctioned within 3 months of receipt of complete information for rebate claims. Aggrieved by said orders, party filed appeals before Commissioner (Appeals) Lucknow who vide order-in-appeal No. 114-126/CE/LKO/08, dated 27-10-08 and No. 188-190/CE/LKO/08, dated 26-11-08 directed the ACCE to pay interest on delayed payment of rebate claims to the party. 3. Being aggrieved by these orders-in-appeal, both manufacturer exporter party and department have fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted with a rebate application. The said public Notice is not issued in the context of rebate application under Rule 18 of the Central Excise Rules but is issued in the context of claim for refund of export duty under Section 26 and 27 of the Customs Act, 1962. As regards a claim for rebate of Central Excise Duty paid on export goods the documents to be submitted are specified in the said para 8.3 of the C.B.E.C. Manual and in Circular dated 30-5-1995 and nowhere do these require submission of Bank Realization Certificate with the rebate application. 3.5 That the Commissioner (Appeals) has completely misread para 2.3, 2.3.1 2.3.2 of the Board Circular No. 354/70/97-CX., dated 13-11-1997 which clears that even in the absence of the TR or Bank Realization Certificate, the proof of export has to be accepted based on the Bill of Lading and the refund has to be sanctioned. After the sanction of the refund a post facto verification has to be done and if within 160 days after the sanction of rebate, the TR or BRC are not produced, action has to be taken for recovery of the rebate. In the present case, the Bill of Lading had been submitted with the rebate application and consequently th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under : On a very careful consideration of the issue, we find that the refund claim was submitted on 13-1-2003. The Department is expected to take a decision either to reject the refund claim or to sanction it within a period of 3 months, if they don t want to saddle the Department with any interest liability. But in this case, only just before the elapse of three months, they issued a show cause notice dated 9-4-03 asking for certain original documents. This approach is not correct. When three months time has been given, the show cause notice cannot be issued just before the elapse of three months. The ratio of the said judgment is squarely applicable in the present case. 4. II. Grounds of Revision Application filed by Applicant Department 4.1 The order-in-appeal setting aside order-in-original is ambiguous and suffering from contradiction - Para-1 of order-in-appeal states that the following appeals have been filed by the applicant against order-in-original (03 Nos.) wherein the payment of interest on delayed sanction of rebate claims has not been considered. Para 6 of order-in-appeal starts as under : I have carefully gone through the records of the case. The onl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) Notification No. 19/2004-C.E. (N.T.), dated 6-9-04 as amended (issued under Rule 18 of Central Excise Rules, 2002) prescribes that procedure to be followed for sanction of rebate. Para (b)(ii) of the notification stipulates that the Assistant Commissioner of Central Excise has to satisfy himself to decide that the claim is in order based on the documents submitted by the party. (iv) Para 2.4 of Chapter 9 (Refund) of Central Excise Manual of Supplementary Instructions regarding presentation of refund claims requires that - It may not be possible to scrutinize the claim without the accompanying documents and decide about its admissibility. If the claim is filed without requisite documents, it may lead to delay in sanction of the refund. Moreover, the claimant of refund is entitled for interest in case refund is not given within three months of the filing of claim. Consequently, submission of refund claim without supporting documents will not be allowed. Even if claim is filed by post or similar mode, the claim should be rejected or returned with Query Memo (depending upon the nature/importance of documents not filed). The claim shall be taken as filed only when all relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . mentioned on the shipping bills for CFS/DOCK/ICD Stuffed cargo is Customs Seal. Consequent to the above, the applications were found to be correct in all respect and orders sanctioning rebate and rejecting interest were issued on 8-8-08. In view of the above facts, the findings of Commissioner (Appeals) are not correct and the party is not entitled to interest. 4.3 It is also not out of contents to mention here that export is treated as complete only when the goods are loaded into ship and Bill of Lading issued. In the instant case the Bill of Lading which is a document prepared by shipper of the party (for which Customs Central Excise is not accountable) was found incorrect/incomplete. Hence, the Bill of Lading/Mate Receipt without Customs Seal cannot be treated as a complete proof of export. Therefore, the submission of the rebate claim without proper documents especially without proof of export cannot be allowed. The claim shall be taken as filed only when all relevant documents are available. It was duty of the claimant to ensure that the rebate claim is supported by the requisite documents. But in the instant case the party have not submitted the proof of export r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 35EE of the Central Excise Act, 1944 was issued to the respondent M/s. Reliance Industries Ltd. who filed their counter reply vide their letter dated 9-5-09. Their main arguments are as under : 5.1 That the Commissioner (Appeals) has correctly ordered payment of interest under Section 11BB of the Central Excise Act, 1944. The said Section 11BB provides that where any refund (which as per Explanation to Section 11B includes rebate of duty paid on export of goods) is granted under Section 11B(2), after the expiry of three months from the date of receipt of the refund application, interest shall be payable for the period from the expiry of the said three months till the date of refund. In each of the three appeals decided by the common order of the Commissioner (Appeals) impugned in the present revision application, the rebate had been granted after the expiry of the period of three months from the date of the filing of the rebate application. We were therefore clearly entitled to interest on the amount of rebate under the said Section 11BB and the Commissioner has rightly ordered the same. 5.2 In the present revision application, the Commissioner of Central Excise, Luckn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . There is no dispute that the documents prescribed by the said Para 8.3 were all submitted. Further, Para 8.4 of the said Instructions provides that the officer granting the rebate has to satisfy himself about the fact of export from the original and duplicate copies of the ARE-1 duly certified by the Customs. Thus the documents which are to be the proof of export and on the basis of which the rebate has to be granted are the original and duplicate ARE-1 duly certified by the customs. Admittedly these had been submitted with the rebate application. Once the original and duplicate ARE-1 duly certified by customs are submitted with the rebate application that is complete proof of export and it cannot be contended that the proof of export was not complete or that the rebate application was not complete because the customs seal number appearing in the Shipping Bill was not mentioned in the Mate Receipt/Bill of Lading. There is no such requirement under the Notification or the instruction that the Customs Seal number appearing in Shipping Bill must be mentioned in the Mate Receipt/Bill of Lading. Thus the delay on the part or the Assistant Commissioner of Central Excise in granting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nment on 3-5-11 and hearing was fixed for 23-6-11 but nobody appeared for hearing on the said adjourned date also. However, department vide letter F.No. LTU/MUM/CExcise/GLT-3A/RTI/CESTAT/92/08-09 dated 10-6-09 raised the issue of jurisdiction. Department pleaded that issue of payment of interest does not fall in the jurisdiction of Central Government in terms of first proviso to sub-section (1) of Section 35 of Central Excise Act, 1944. 7. Government has considered both oral and written submissions of the applicant and also perused orders passed by the lower authorities. 8. From the perusal of records, Government observes that for the impugned exports herein, there is no dispute so far as sanction of basic amounts of all the above rebate claims which were sanctioned but the dispute herein is in respect of interest for the delayed payment of the rebate claims under Section 11BB of the Central Excise Act, 1944 which was either rejected or objected by the department as the applicant did not submit the requisite replies to objections/deficiency memos as raised by the department with an option or to give an undertaking for submission of proper/respective Bank Realization Certificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue to be decided is whether the interest liability under Section 11BB of the Central Excise Act, 1944 arises after the expiry of 3 months of the date of filing of the rebate claim or after the rebate claim becomes due for sanction as per the satisfaction of the rebate sanctioning authority. 10. In reference to above, Government observes that this issue has already been elaborately discussed and decided vide GOI Order No. 281-377/2011-CX dated 5-4-2011 in respect of the same exporter party. The operative portion of which is reiterated as under : 8.0 In this regards, Government observes that the refund/rebate is paid under Section 11B of the Central Excise Act, 1944 and interest is paid under Section 11BB of the Central Excise Act, 1944. The relevant Sections are reproduced below for ready reference. : Section 11BB: Interest on delayed refunds. - If any duty ordered to be refunded under sub-section (2) of Section 11B to any applicant is not refunded within three months from the date of receipt of application under sub-section (1) of that section, there shall be paid to that applicant interest at such rate [not below five per cent and not exceeding thirty per cent per annum as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Ltd. [2008 (229) E.L.T. 498 (Bom.)] the Hon ble Bombay High Court has held as under : Interest on delayed refund : Interest is payable under Section 11BB of Central Excise Act, 1944 on expiry of three months from the date of receipt of application and that explanation appearing below Section 11BB ibid does not have any effect or connection with date from which interest under Section 11BB ibid becomes payable - the only purpose served by explanation is to introduce a deeming fiction which is relevant for purpose of sub-section (2) of Section 11B ibid. 8.3 Similarly, in the case of M/s. U.P. Twigs Fibre Glass Ltd. v. UOI, the Hon ble High Court of Judicature at Allahabad [2008 (229) E.L.T. 205 (All.) has also held the same view. The Hon ble Supreme Court in the above quoted case [2009 (243) E.L.T. A27 (S.C.)] has also held as under : In our view, the law is laid down by the Rajasthan High Court succinctly in the case of J.K. Cement Similarly, Works v. Asstt. Commissioner of Central Excise and Customs reported in 2004 (170) E.L.T. vide para 33 : A close reading of Section 11BB, which now governs the question relating to payment of interest on belated payment of interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Benny Impex Pvt. Ltd. - 2007 (218) E.L.T. 305 (GOI), (b) PRG International - 1999 (113) E.L.T. 751 (GOI). 8.5 In view of above discussions, Government concludes that in the case of refund/rebate filed under Section 11B of the Central Excise Act, 1944, the interest liability will arise in terms of Section 11BB ibid after the expiry of 3 months from the date of receipt of the application for refund/rebate of duty. 11. In the instant rebate claim cases, the department called for clarification on the absence of proper customs seal etc. and also respective undertaking for submission of respective BRCs as an alternative which were complied by the applicant exporter. Department has not disputed the fact that the rebate claims were filed alongwith all the requisite documents. The enquiry made by department from the Customs at port of export regarding genuineness of Bill of Lading/Mate Receipt cannot be a reason of delaying the sanction of rebate claim. There is no specified document which was not submitted by applicant. As per statutory requirement as discussed above, the claims were required to be sanctioned within 3 months as all the requisite documents were submitted by exporter al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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