1986 (2) TMI 222 - AT - Customs

Tribunal Upholds Customs Act in Refund Claims: Emphasizes Supreme Court Precedent

The Tribunal dismissed the reference application, affirming the strict application of Section 27(1) of the Customs Act for refund claims related to ... Reference to the High Court not maintainable if point of law already settled by the Supreme Court Issues:- Interpretation of Section 27(1) of the Customs Act regarding refund claims.- Constitutionality of Section 27 and related questions.- Tribunal's power to condone delay in refund claims.- Applicability of general principles of law of limitation in customs proceedings.- Binding nature of Supreme Court decisions on all authorities.Analysis:1. Interpretation of Section 27(1) of the Customs Act:- The case involved a dispute over the refund of duty for goods imported but missing. The Tribunal upheld the rejection of the refund claim, stating that Section 27(1) imposes a mandatory time limit for such claims. The Tribunal emphasized that Customs authorities cannot entertain refund claims made after the stipulated period, as per the decision in Miles India Ltd. v. Appellate Collector of Customs. The Tribunal reiterated that Section 27(1) applies to refund claims concerning imported goods, regardless of their subsequent status.2. Constitutionality of Section 27 and Related Questions:- The applicant argued that Section 27(1) was unconstitutional, violating various articles of the Indian Constitution. However, the Tribunal held that the constitutionality of statutory provisions falls outside its purview. Refund applications for duty paid on imported goods are governed by Section 27(1) of the Customs Act. The Tribunal emphasized that Customs authorities must adhere to the provisions of the Act and cannot question its constitutionality.3. Tribunal's Power to Condone Delay in Refund Claims:- The applicant contended that the Tribunal could condone the delay in filing the refund claim if valid reasons were presented. However, the Tribunal clarified that under Section 27(1), the time limit for refund claims is mandatory, and Customs authorities are bound by this provision. The Tribunal cited precedents to support its stance that parties cannot rely on general principles of limitation law in customs proceedings.4. Applicability of General Principles of Law of Limitation:- The Tribunal highlighted that Customs authorities must adhere strictly to the time limits prescribed under Section 27(1) of the Customs Act for refund claims. The decision in Miles India Ltd. case emphasized that parties cannot seek recourse to general principles of limitation law in customs proceedings. The Tribunal reiterated that the provisions of the Act must be followed without exceptions.5. Binding Nature of Supreme Court Decisions:- The Tribunal underscored that decisions of the Supreme Court are binding on all authorities, including the Tribunal. Referring to the Madras Rubber Factory Ltd. case and the Supreme Court's dismissal of appeals related to Section 27(1), the Tribunal emphasized that settled legal principles established by the Supreme Court must be followed by lower authorities. The Tribunal rejected the reference application, citing the Supreme Court's definitive stance on the issue.In conclusion, the Tribunal dismissed the reference application, affirming the strict application of Section 27(1) of the Customs Act for refund claims related to imported goods and emphasizing the binding nature of Supreme Court decisions on all authorities. The judgment clarified the limitations on Customs authorities in entertaining refund claims and underscored the mandatory nature of statutory provisions in customs proceedings.