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TMI Blog2019 (3) TMI 2050X X X X Extracts X X X X X X X X Extracts X X X X ..... recovery of duties, short levies duties or erroneously refunded within its prescribed time limitation of six months from the relevant date, from the date of notice. Though the section relates to recovery of duties, an analogy can be drawn from the said provisions for identifying what a reasonable time could be in a case of this nature, since Rule 16 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 has been framed by invoking the powers conferred under Customs Act. By drawing an analogy from Section 28 of the Customs Act and applying it to the facts of the present case it is seen that the notice, being one made after a period of six months, cannot be held to be done within a reasonable time. This Court is of the view that the impugned orders passed in these Writ Petitions are liable to be rejected on the ground of delay - Petition allowed. - The Honourable Mr. Justice M.S. Ramesh For the Petitioner in all WPs. : Mr. T. Ramesh. For the Respondent-2 : Mr. K.S. Ramaswamy, Standing Counsel for C CE. For the Respondent Nos. 1 3 : No appearance. COMMON ORDER The petitioner herein is a Registered Manufacturer and Exporter unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise Act, the reasonable period could be within a period of six months and as such, the present impugned recovery letter dated 04.05.1990, which has been made after almost three years, cannot be sustained. The learned counsel for the petitioner further submitted that the suo motu withdrawal letter dated 04.05.1990 without a show cause notice or enquiry also cannot be sustained and is in violation of the principles of natural justice. 5. The learned standing counsel for the Department submitted that Rule 16 of the Customs, Central Excise Duties and Service Tax Drawback Rules-1995, does not prescribe time limitation and by placing reliance on the adjudication given in the impugned orders in revision, submitted that the orders have been properly made. 6. I have given careful consideration to the submissions made by the respective counsels. 7. It is no doubt true that Rule 16 of the Customs, Central Excise Duties and Service Tax Drawback Rules-1995, does not prescribe a period for claiming refund of erroneous excise payment of drawback. But it does not mean that in the absence of any time prescribed, such a refund can be claimed according to the respondents' own whims and f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... drawback claims had been processed and cleared before issuance of the clarification vide letter dated 20th September 1996 by the Commissioner (Drawback) with the approval of the Chairman of C.B.E. C. On a close reading of the said letter, it is apparent that the same envisages finalization of pending drawback claims in the light of the clarification issued therein, namely, that the maximum ceiling has to be inferred even in cases where goods are not exported under AR-4 and/or exporter is unable to furnish the certificate as required under condition (b) of the Note to SS No. 5404 (1) in respect of which drawback is payable at the rate of 17% of the FOB value. Thus, while issuing the initial clarification on 20th September 1996, the instructions issued by the C.B.E. C. were to the effect that the same should be applicable only to pending drawback claims. Subsequently, by the clarification issued vide letter dated 19th August 1999, C.B.E. C. clarified that the earlier clarification of 20th September 1996 was operative from the date of issuance of the original notification and was not only prospective. It appears that it is only pursuant to the subsequent letter dated 19th August ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Article 14 of the Constitution, as it does not provide for any period of limitation for the recovery of duty. He urged that in the absence of any prescribed period for recovery of the duty as contemplated by Rule 12, the officer may act arbitrarily in recovering the amount after lapse of long period of time. We find no substance in the submission. While it is true that Rule 12 does not prescribe any period within which recovery of any duty as contemplated by the Rule is to be made, but that by itself does not render the Rule unreasonable or violative of Article 14 of the Constitution. In the absence of any period of limitation it is settled that every authority is to exercise the power within a reasonable period. What would be reasonable period would depend upon the facts of each case. Whenever a question regarding the inordinate delay in issuance of notice of demand is raised, it would be open to the assessee to contend that it is bad on the ground of delay and it will be for the relevant officer to consider the question whether in the facts and circumstances of the case notice or demand for recovery was made within reasonable period. No hard and fast rules can be laid down in thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of disturbing the rights of citizen should be exercised within a reasonable period of time. In the present case, the drawback had been paid more than three years prior to the issuance of the show cause notices, and despite the fact that clarification in respect of condition (c) of the Note under SS No. 5404(1)(i) of the Schedule had been issued way back in the year 1996, no efforts were made to recover the drawback paid to the petitioners at the relevant time. Thus, the petitioners were entitled to form a belief that the matter has attained finality and arrange their finances accordingly. Now, when after a period of more than three years has elapsed, if the respondents seek to recover the amount of drawback paid, it cannot be gainsaid that such exercise of powers would have the effect of disturbing their rights. Under the circumstances, reading in the concept of reasonable period in rule 16 of the Rules, this court is of the view that the show cause notices in question were clearly time-barred. 26. In the light of the aforesaid discussion, in the opinion of this court, though rule 16 of the Drawback Rules does not provide for any period of limitation, a reasonable period has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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