Refund of late filing fees upheld where system EDI error and vessel detention caused delay and remaining delay waived

CESTAT allowed the appeal and upheld refund of late fee charges. The tribunal found the bill of entry had been presented but not uploaded due to an Indian Customs EDI system error and that vessel detention by the HC delayed formal filing; the interval from initial presentation to subsequent filing must be excluded from the prescribed filing period. Any remaining delay was waived by the Joint Commissioner and the Assistant Commissioner correctly sanctioned the refund, so the refund order was held to be proper.

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Issues:
1. Entitlement to refund of late fees charges due to system error in Indian Custom EDI System.
2. Grant of waiver by Joint Commissioner and subsequent refund claim before Assistant Commissioner.
3. Appeal against the order of the Commissioner (Appeals) allowing the department's appeal.

Analysis:

1. The primary issue in this case was whether the appellant was entitled to a refund of late fees charges paid due to a system error in the Indian Custom EDI System. The appellant faced difficulties in uploading the Bill of Entry electronically with GST provisions because of the system error. Additionally, the vessel was arrested by the High Court, further delaying the filing of the bill of entry. The appellant contended that these circumstances were beyond their control, justifying the waiver of late fees. The Joint Commissioner granted the waiver, and the Assistant Commissioner sanctioned the refund accordingly.

2. The second issue involved the grant of waiver by the Joint Commissioner and the subsequent refund claim before the Assistant Commissioner. The appellant argued that the delay in filing the bill of entry was not their fault, given the system error and the vessel's arrest. The Joint Commissioner's decision to waive the late fee charges was crucial in this context. The Assistant Commissioner, following the waiver order, approved the refund of late fees. The Tribunal noted that the revenue did not dispute the waiver granted by the Joint Commissioner, strengthening the appellant's case for the refund.

3. The final issue revolved around the appeal against the order of the Commissioner (Appeals) who allowed the department's appeal. The Tribunal, after considering the submissions from both sides and examining the records, concluded that the appellant's situation warranted the reduction of the filing period for the bill of entry due to the system error and vessel arrest. The Tribunal found no error in the Assistant Commissioner's decision to sanction the refund, especially since the revenue did not contest the waiver of late fees. Consequently, the Tribunal set aside the order of the Commissioner (Appeals) and allowed the appellant's appeal, affirming the entitlement to the refund of late fees charges.

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