1983 (5) TMI 254 - AT - Customs

Tribunal rejects appeal for refund claim on operational loss; emphasizes uniform recording procedures.

STEEL AUTHORITY OF INDIA LTD., CALCUTTA Versus COLLECTOR OF CUS., CALCUTTA

The Tribunal upheld the rejection of the appeal regarding a refund claim due to operational loss, not transit or storage loss, caused by discrepancies in ... - Issues:1. Rejection of refund claim on the ground of being time-barred.2. Determination of loss as operational loss and not transit or storage loss.3. Discrepancy in recording quantities of oil despatched from storage tanks.4. Applicability of provisions for condonation of operational losses.Analysis:The appeal was filed against the Order passed by the Appellate Collector confirming the rejection of a refund sought by the appellants due to short-landing of certain items. The Asstt. Collector rejected the claim as time-barred, which was upheld by the Appellate Collector, leading the appellant to file a revision petition before the Central Government. The revision was transferred to the Tribunal for disposal as an appeal under Section 131B of the Customs Act, 1962.During the hearing, the appellant contended that the loss in question was an operational loss within the installation, not a storage or transit loss. The quantity of oil removed from the storage tank was a point of contention, with discrepancies in recording the quantity ascertained by dip readings of the storage tank versus tank wagons. The appellant argued that the advised quantity should be based on the storage tank discharge quantity, irrespective of the purpose of removal for bonded despatch or duty paid despatch.The Tribunal observed inconsistencies in the procedures for recording quantities of oil despatched from storage tanks, emphasizing the need for uniformity in methodology. A significant discrepancy of 7.684 K.L. of oil was noted between dip readings in the storage tank and tank wagons, leading to the classification of the shortage as an operational loss. The Tribunal rejected the appellant's contention that the loss could be condoned, as there was no specific provision or authority authorizing remission of duty on operational losses.In conclusion, the Tribunal upheld the rejection of the appeal, emphasizing the lack of provision to deal with operational losses and the inability of the appellants to demonstrate any rule or authority supporting remission of duty in such cases.