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TMI Blog2024 (7) TMI 1078X X X X Extracts X X X X X X X X Extracts X X X X ..... 27 is not applicable, the proper officer will also not be competent to entertain or grant the refund of the claim for refund that has been made by the appellant before the proper officer. Since statutory authorities cannot function in vacuum, the proposition that Section 27 is not applicable is without any legal basis, which will be self-defeating and also against interest of the appellant themselves. 4. Section 27 of the Customs Act, 1962 prescribed the condition for filing an application for refund before the expiry of one year, from the date of payment, which is the outer limit for filing any claim for refund under the provisions of the Act. The proviso to Section 27 stated that the limitation of one year shall not apply where any duty or interest has been paid under protest, and as such, in this particular case, the limitation period of one year from the date of deposit will not be applicable as the amounts were deposited under protest. The protest was taken up further by the appellant in the form of appeal before the Commissioner (Appeals), which was concluded by rejection of their appeal by the Commissioner (Appeals) in his order dated 21.06.2012. The protest was further t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dy. Commissioner of Customs, Noida is correct in rejecting the refund claim on the grounds of limitation which is also found to be legal and proper, and does not require any interference. The failure of the appellant to take timely action as per the provision of Section 27 of Customs Act, 1962 has become fatal to them in the given facts and circumstances of the case. 8 Accordingly, I reject appeal bearing No. 111/CUS/ NOIDA/ APPL/NCUS/2020-21 filed by M/s Ratan Textiles Pvt. Ltd., F-200-201, EPIP, Sitapur. Jaipur-302022 (Rajasthan) and upheld the Order-in-Original No. 11/Refund/Noida Customs/2020 dated 29.04.2020." 2.1 The Appellant has filed a refund claim for refund of Rs 1,45,000/- vide their letter dated 10.07.2019 received by the jurisdictional officer on 26.07.2019, in pursuance of Tribunal's Final Order No. 71646-71650/2017 dated 10.11.2017. Tribunal had held as follows:- "5. From perusal of the show cause notice, I find that no valuation of the goods proposed to be exported have been done as a result of the purported inspection. Thus, I find that the allegation of overvaluation is without any basis. Thus, the show cause notice is held to be not maintainable as it does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e chronology of events leading to the refund claims in dispute is as depicted in the table below:- Sr. No. DATES EVENTS 1 20.09.2011 Shipping Bill No 5483931 dt. 20.09.2011 for export of 100% Cotton Powerloom Printed Woven Made up was filed by the Appellant. The goods were confiscated by the Department under the pretext of mis-declaration and an option to redeem the same was given to the Appellant only on payment of a redemption fine and a penalty. The appellant deposited the fine and penalty. 2 10.11.2017 Being aggrieved by the Order for imposition of redemption fine and penalty, an appeal was filed by the Appellant before the Commissioner (Appeals). Commissioner (Appeals) upheld the Order-in-Original vide Order in Appeal No 166/Cus/Appl/Noida/2012 dtd. 21.06.2012. An appeal was filed before Tribunal and the said appeal was allowed with consequential relief vide Order bearing FO No. 71646-71650/2017 dated 10.11.2017. 3 26.07.2019 In pursuance of the Order of Tribunal dated 20.11.2017, a refund application was filed by the Appellant before the Deputy Commissioner of Customs, Noida, for refund of Rs. 1,45,000/-. 4 29.04.2020 The Refund Application was rejected vide th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In my considered view, even there is no need of filing refund claim in case of succeeding in a matter of dispute on Cenvat credit. In the present case, even if the amount is towards reversal of Cenvat credit but it is as good as availment of fresh Cenvat credit therefore unjust enrichment is not applicable for availment of Cenvat credit. In the present case also refund of Cenvat credit need not to be undergone the test of unjust enrichment. The judgment cited by the ld. Counsel supports the case of the appellant. I therefore set aside the impugned order and allow the appeal of the appellant." 4.5 In case of USV Ltd. [2016 (45) S.T.R. 83 (Tri. - Mumbai)] following has been held: "5. ..... The judgments relied upon by the ld. Counsel are applicable as in those judgment, it has been held that the refund of any amount deposited during the investigation and proceedings the limitation of 1 year from the date of deposit shall not apply. In the present case also the refund is not hit by limitation...." 4.6 In case of Mangalam Cement Ltd. [2011 (24) S.T.R. (T-Del)] following has been observed: "6. ..... It stands held that, after considering various precedent decisions, that the amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which was placed on the record of the Supreme Court. The Supreme Court directed the payment of interest in terms of the draft circular. A circular was issued by the CBEC on 8 December, 2004 reiterating that in terms of the directions of the Supreme Court, pre-deposits must be returned within three months from the date of the order passed by the Appellate Tribunal or court unless there was a stay on the order by a superior court and that the Board had decided to implement CESTAT orders already passed for payment of interest in compliance of which interest payable would be paid forthwith." 4.9 When fines and penalties are being set aside Revenue is duty bound to refund the said amounts as all for implementation of the order of the Appellate Authority. Such implementation of the order Appellate Authority could not have been fully closed by relying upon the provisions of Section 27 as per the Customs Act Section 27 of the Customs Act define the relevant date in case where refund of duty becomes due in the light of the orders of the Appellate Authorities, Courts or Tribunal. Provisions of 27 reproduced below:- "[27. Claim for refund of duty [(1) Any person claiming refund of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -assessment, from the date of such re-assessment]." 4.10 In case of Cooper Pharma [2017 (357) E.L.T. 929 (T-Del)] following was held: "6. I find that as a consequence of the order dated 18-8-2004 [2004 (174) E.L.T. 143 (Tribunal)] passed by the Tribunal, the appellant has filed the formal application before the jurisdictional authorities, claiming refund of Rs. 1,50,000/- paid as penalty. Section 11B ibid deals with filing of refund application in respect of Central Excise duty. Since there is no specific mention about refund of penalty in Section 11B ibid, I am of the view that time limit prescribed therein would not have any application for sanction of such refund amount. Further, the amount in question was recovered by the Department under Section 11 ibid, before disposal of appeal by the Tribunal in setting aside the said penalty amount. Since as a consequence of the Tribunal's order, the appellant has claimed the refund amount, the same cannot be retained by the Department on the ground that no appeal against the order dated 3-2-2000 was filed by the appellant." 4.11 From the perusal of the above provisions it is noted that period of limitation of one year does not apply w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterpretation which represents the true intention of the Legislature. This task very often raises the difficulties because of various reasons, inasmuch as the words used may not be scientific symbols having any precise or definite meaning and the language may be an imperfect medium to convey one's thought or that the assembly of Legislatures consisting of persons of various shades of opinion purport to convey a meaning which may be obscure. It is impossible even for the most imaginative Legislature to forestall exhaustively situations and circumstances that may emerge after enacting a statute where its application may be called for. Nonetheless, the function of the Courts is only to expound and not to legislate. Legislation in a modern State is actuated with some policy to curb some public evil or to effectuate some public benefit. The legislation is primarily directed to the problems before the Legislature based on information derived from past and present experience. It may also be designed by use of general words to cover similar problems arising in future. But, from the very nature of things, it is impossible to anticipate fully the varied situations arising in future in which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of right to life and liberty has to be given strict interpretation or else many innocent might become victims of discretionary decision-making. Insofar as taxation statutes are concerned, Article 265 of the Constitution [265. Taxes not to be imposed save by authority of law - No tax shall be levied or collected except by authority of law.] prohibits the State from extracting tax from the citizens without authority of law. It is axiomatic that taxation statute has to be interpreted strictly because State cannot at their whims and fancies burden the citizens without authority of law. In other words, when competent Legislature mandates taxing certain persons/certain objects in certain circumstances, it cannot be expanded/interpreted to include those, which were not intended by the Legislature. 22. At the outset, we must clarify the position of 'plain meaning rule or clear and unambiguous rule' with respect of tax law. 'The plain meaning rule' suggests that when the language in the statute is plain and unambiguous, the Court has to read and understand the plain language as such, and there is no scope for any interpretation. This salutary maxim flows from the phrase "cum inverbis nul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prudence 171 n. (t) (Glanville L. Williams ed., 10th ed. 1947). 24. As contended by Ms. Pinky Anand, Learned Additional Solicitor General, the principle of literal interpretation and the principle of strict interpretation are sometimes used interchangeably. This principle, however, may not be sustainable in all contexts and situations. There is certainly scope to sustain an argument that all cases of literal interpretation would involve strict rule of interpretation, but strict rule may not necessarily involve the former, especially in the area of taxation. The decision of this Court in Punjab Land Development and Reclamation Corporation Ltd., Chandigarh v. Presiding Officer, Labour Court Chandigarh and Ors., (1990) 3 SCC 682, made the said distinction, and explained the literal rule- "The literal rules of construction require the wording of the Act to be construed according to its literal and grammatical meaning whatever the result may be. Unless otherwise provided, the same word must normally be construed throughout the Act in the same sense, and in the case of old statutes regard must be had to its contemporary meaning if there has been no change with the passage of time." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LORD WENSLEYDALE, reaffirmed by LORD HALSBURY AND LORD SIMONDS, means : 'The subject is not to be taxed without clear words for that purpose : and also that every Act of Parliament must be read according to the natural construction of its words. In a classic passage LORD CAIRNS stated the principle thus : "If the person sought to be taxed comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if the Crown seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however apparently within the spirit of law the case might otherwise appear to be. In other words, if there be admissible in any statute, what is called an equitable construction, certainly, such a construction is not admissible in a taxing statute where you can simply adhere to the words of the statute. VISCOUNT SIMON quoted with approval a passage from ROWLATT, J. expressing the principle in the following words : "In a taxing Act one has to look merely at what is clearly said. This is no room for any intendment. There is no equity about a tax. There is no presumption as to tax. Nothing is to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity to tax and it is for the Legislature to determine the same [Kapil Mohan v. Commr. of Income Tax, Delhi, AIR 1999 SC 573]. Similarly, hardship or equity is not relevant in interpreting provisions imposing stamp duty, which is a tax, and the Court should not concern itself with the intention of the Legislature when the language expressing such intention is plain and unambiguous [State of Madhya Pradesh v. Rakesh Kohli & Anr., (2012) 6 SCC 312]. But just as reliance upon equity does not avail an assessee, so it does not avail the Revenue." The passages extracted above, were quoted with approval by this Court in at least two decisions being Commissioner of Income Tax v. Kasturi Sons Ltd., (1999) 3 SCC 346 and State of West Bengal v. Kesoram Industries Limited, (2004) 10 SCC 201 [hereinafter referred as 'Kesoram Industries case' for brevity]. In the later decision, a Bench of seven-Judges, after citing the above passage from Justice G.P. Singh's treatise, summed up the following principles applicable to the interpretation of a taxing statute : "(i) In interpreting a taxing statute, equitable considerations are entirely out of place. A taxing statute cannot be interpreted on any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the provisions of Section 11B provide a period of one year, for claiming refund, from the relevant date. The relevant date also stands prescribed in the said Section. However, if the duties have been paid under protest, the period of one year is not applicable. The appellant's contention is that the demand was paid under protest and as such limitation would not be applicable." 4.14 I do not find any merits in the submissions made to the fact that the provisions of Section 27 could not apply to the case of refund of penalty and fines. Hon'ble Supreme Court has in the case of Mafatlal Industries [1997 (89) E.L.T. 247 (SC)] held as follows:- "99. The discussion in the judgment yields the following propositions. We may forewarn that these propositions are set out merely for the sake of convenient reference and are not supposed to be exhaustive. In case of any doubt or ambiguity in these propositions, reference must be had to the discussion and propositions in the body of the judgment. (i) Where a refund of tax/duty is claimed on the ground that it has been collected from the petitioner/plaintiff - whether before the commencement of the Central Excises and Customs Laws (A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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