2021 (5) TMI 642 - AT - Customs

Tribunal directs reevaluation of delayed export claims, stresses authority's duty to assess each claim

The Tribunal set aside the Commissioner of Customs' rejection of condonation of delays in filing brand rate and duty drawback claims on exports. ... Condonation of delay in filing claims for fixation of ‘brand rate’ - precluded from sanction of ‘duty drawback’ on exports effected in four quarters between July 2017 and June 2018 - competent authority deprived the exporter of opportunity to rebut the grounds of refusal by not placing them on notice - HELD THAT:- Doubtlessly, several amendments were brought about in the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 vide notification no. 49/2010-Cus(NT) dated 17th June 2010 for liberalizing the procedure for fixation of ‘brand rates’ in sanctioning ‘drawback’ on exported goods. Particularly, the Commissioner of Customs approached the disposal of applications of the appellant with rigidity that is not in consonance with intent of reimbursement mechanism enshrined in the statute and is, effectively, a binding obligation upon the designated instrument of the State - Furthermore, the competent authority deprived the exporter of opportunity to rebut the grounds of refusal by not placing them on notice of such intent. The generality of the reasons adduced reflect failure to consider each of the claims for identification of the impediment that the elapse of time yoked the ascertainment of entitlement with. There is no justification for refusal to condone the delay in each application which must be returned for reconsideration of the claims from inception. The revised provisions provide for compartmentalization of authority to condone; the Commissioner of Customs is enabled to intervene only beyond the competence vested in the Assistant/Deputy Commissioner with corresponding fees prescribed in the said Rules - Appeal disposed off. Issues:Appeal against refusal to condone delays in filing claims for brand rate and duty drawback on exports.Analysis:1. The appellant appealed against the refusal to condone delays in filing claims for brand rate and duty drawback on exports. The rejection was challenged before the Commissioner of Customs (Appeals) but was declined due to jurisdictional issues, leading to the appeal before the Tribunal.2. The Authorized Representative argued that the appellant deviated from the general practice by filing claims at quarterly intervals instead of monthly intervals. The contention was that the Commissioner of Customs had the authority to condone delays, and hypothetical conjectures were deemed irrelevant in the proceedings.3. The appellant's counsel argued that the rejection by the Commissioner of Customs violated the spirit and letter of the rules governing brand rate and duty drawback claims. The liberalized scheme aimed to accept requests unless there were sufficient grounds not to do so, which were not evident in the impugned order.4. Amendments were made to the Customs, Central Excise Duties, and Service Tax Drawback Rules in 2010 to liberalize the procedure for brand rate fixation and drawback sanction on exported goods. The Tribunal noted that the Commissioner of Customs approached the applications with rigidity not in line with the reimbursement mechanism's intent.5. The Tribunal emphasized the importance of reimbursement mechanisms under the Customs Act, stating that reimbursements were legal commitments devolving on the State. The authority's failure to consider each claim for condonation of delay led to the decision to remand the claims for reconsideration from the beginning.6. The Tribunal highlighted the need for compartmentalization of authority to condone delays, with the Commissioner of Customs intervening only beyond the Assistant/Deputy Commissioner's competence. The impugned order was set aside, directing the Commissioner to segregate requests for condonation according to jurisdiction and to decide within his competence.7. Ultimately, the appeals were disposed of accordingly, with the decision pronounced in open court on 07/04/2021.