2023 (4) TMI 929 - AT - Customs

Customs duty refund appeal denied due to short-shipped goods, contractual obligations not relevant.

The Tribunal dismissed the appeal regarding the refund of Customs duties for short-shipped goods, emphasizing that duty refund was provided for the ... Refund of Customs duties paid at the time of assessment - goods short shipped - Export took place or not - HELD THAT:- It is undisputed that the impugned quantity of 7833 MT did not leave the shores of this country and were not exported. Therefore, to impute realization in terms of contractual obligation for the said quantity not exported per se does not arise. It may be pointed out that the importer paid export duty at a specified rate for the specified quantity of goods under export, and at that very specified rate for the imputed short shipped quantity, they have been refunded the amount of duty, which otherwise was recovered from them at the time of provisional assessment. Since the goods under question were not exported, there is no relevance in bringing into consideration the contractual obligations towards realization of export proceeds, as there are no export proceeds realized for the said 7833 MTs of goods not exported. There is no merit in the present case - the appeal filed by the appellant is dismissed. Issues involved: The judgment concerns the refund of Customs duties paid for goods short shipped.Details of the Judgment:Issue 1: Refund of Customs duties for short-shipped goodsThe case involved M/s Khatau Narbheram & Company filing a shipping bill for export of 12000 MTs of Iron Ore Fines, but only 4167 MTs were actually exported. The appellant filed a refund claim for the excess duty paid at the time of provisional assessment. The refund claim for the short-shipped quantity was sanctioned under Section 27 of the Customs Act, 1962. The appeal was filed as the appellant claimed they were not refunded an amount that should have been paid to them based on contractual obligations with the importers. However, the Tribunal observed that since the goods were not exported, there was no relevance in considering contractual obligations for the unexported quantity. The duty refund was provided for the short-shipped quantity, and the appeal was dismissed.Issue 2: Assessment and calculationsThe shipping bill was assessed for 12000 MTs of Iron Ore Fines at a Customs duty rate of US$ 167 per MT. The refund was claimed for the short-shipped quantity of 7833 MTs, and the duty refund was calculated accordingly. The Tribunal considered the calculations submitted by the Revenue in support of their contention and found that the duty refund was correctly sanctioned for the unexported quantity. The Tribunal also noted the absence of export proceeds for the unshipped goods, emphasizing that contractual obligations for realization did not apply in this case.Conclusion:The Tribunal dismissed the appeal, stating that there was no merit in the case as the duty refund was provided for the unexported quantity of goods. The judgment highlighted the distinction between duty refund for short-shipped goods and contractual obligations related to export proceeds, emphasizing that in the absence of actual export, such contractual obligations were not applicable.