2017 (3) TMI 1630 - AT - Customs

Importance of Alternative Evidence in Customs Refund Process: Tribunal Emphasizes Procedural Fairness

Commissioner of Cus. & C. EX., Noida Versus Progressive Alloys (I) Pvt. Ltd.

The Tribunal dismissed the Revenue's appeal and directed the Adjudicating Authority to verify the submitted documents and process the refund of Special ... Refund of SAD - whether the refund claim of SAD (Special Additional Duty in lieu of Sales Tax) paid at the time of import have been rightly refused on the failure of the respondent to file original copy of the bill of entry and the relevant challans? - Held that: - filing of original bill of entry and/or TR-6 Challan is not a mandatory or essential document for the processing of refund under N/N. 102/2007-Cus. - the Adjudicating Authority to complete the verification process within a period of 60 days from the date of receipt of copy of this order, if not done so far, and to disburse the refund immediately thereafter with interest as per Rules - appeal dismissed - decided against Revenue. Issues:Refusal of refund claim for Special Additional Duty in lieu of Sales Tax due to missing original bill of entry and challans.Analysis:The appeal by the Revenue revolved around the denial of a refund claim for Special Additional Duty (S.A.D.) paid during import due to the respondent's failure to provide the original bill of entry and relevant challans. The respondent, an importer, had imported Nickel Cathode and subsequently sold the goods after paying VAT/CST, filing a refund claim for Rs. 5,50,103. Despite losing the original documents, the respondent submitted a copy of FIR and an indemnity bond along with the refund claim. The Adjudicating Authority rejected the claim without issuing a deficiency memo or show cause notice, depriving the respondent of a fair hearing. The Commissioner (Appeals) noted the Authority's oversight in considering the FIR and indemnity bond, as well as failure to follow Customs Department procedures for lost documents. The Commissioner emphasized that the original bill of entry and TR-6 Challan were not mandatory for processing the refund under Notification No. 102/2007, directing the lower court to verify the submitted documents and allow the refund.The Revenue contended that C.B.E. & C. Circular No. 16/2008-Cus. mandated defacement of original bill of entry upon refund approval to prevent duplicate claims for the same goods. However, upon review, it was established that the original bill of entry and TR-6 Challan were not obligatory documents for refund processing under Notification No. 102/2007. Consequently, the Adjudicating Authority was instructed to complete verification within 60 days and disburse the refund promptly with applicable interest. The Tribunal dismissed the Revenue's appeal, affirming the respondent's entitlement to consequential benefits as per the law.In conclusion, the judgment clarified that the absence of original bill of entry and TR-6 Challan did not invalidate the refund claim under the relevant notification. The decision emphasized procedural fairness, highlighting the importance of considering alternative evidence when original documents are lost. The Tribunal's ruling underscored the principle that strict adherence to document requirements should not overshadow the substantive eligibility for a refund, ensuring a balanced approach to administrative procedures in customs matters.