TaxTMI 
TaxTMI 
2010 (9) TMI 300
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....tral Excise at Mumbai ("the Commission" for short) contending that the Commission has no jurisdiction to settle the proceedings initiated by the Customs for the recovery of drawback. Factual Backdrop : 2. The factual matrix giving rise to the present petition, in nutshell, is that the proceeding were initiated against respondent Nos. 2 to 7 and others by the Revenue by issuing show-cause-notice, inter alia; for recovery of duty drawback amounting to Rs. 2,07,71,436/- with interest, said to have been obtained fraudulently by respondent No. 2 on the projected claim of Rectified Spirit (Ethyl Alcohol) having minimum strength of 94.68% v/v at 15.6°C under two shipping bills during the months of September, 2000 and February, 2001 re....
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....l order dated 23rd November, 2004 settled the case at duty liability of Rs. 2,07,71,436/- with interest thereon at the rate of 10% per annum for the time lag i.e. between the date of receipt of duty drawback amount and the date of its pay back. Immunity from fine, penalty and prosecution also granted to all the applicants under the said order. 6. The aforesaid order of the Settlement Commission is a subject matter of challenge in this petition as indicated in the opening para of this judgment. Rival Submissions : 7. Mr. R.V. Desai, learned senior counsel appearing for the petitioner- Revenue urged that the respondent Nos. 2 to 4 ("Exporters" in short) were not entitled to drawback since the claim had not exported goods ....
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....ecovery of drawback is nothing but recovery of duty element along with declarations made in the shipping bill and, therefore, covered within the meaning of Section 127-A(b) of the Act. According to him, the Commission has failed to appreciate that verification of amount of drawback is carried out with reference to parameters under which said drawback is permissible i.e. whether the goods are of the description/specification mentioned in the Drawback Table and the amount claimed is as per the rate specified in the Drawback Table and not with reference to duty initially assessed at the time of import or manufacture of goods, on which drawback is considered. 11. Mr. Desai, alternatively, submits that assuming but not admitting that th....
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....drawback is part of duty itself. He further submits that since the duty drawback is directly related to duty, all cases which deal with drawback also can be settled before the Settlement Commission. He further submits that exclusion of jurisdiction must not be inferred easily. This more so when the Parliament has consciously left certain matters out of the scope of the Settlement Commission. In support of his submission, he pressed into service fourth proviso to sub-section (1) of Section 127-B of the Act to contend that statutory exclusions which are mentioned therein do not exclude the cases dealing with drawback. He further submitted that the Revenue is seeking to narrow the jurisdiction of the Settlement Commission by contending that th....
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....ted as a "case" as defined in the Act and that application before the Settlement Commission was very much maintainable in accordance with law. 14.The Settlement Commission while considering the issue before it, relied upon the term "drawback" as defined in Re-export of Imported Goods (Drawback of Customs Duties) Rules, 1995 and the Drawback Rules and also Section 74 of the Act dealing with the imported material used in the manufacture of goods which are exported. They also considered sweep of Section 127-B of the Act and relied upon the Apex Court judgment in the case of Chemicals and Fibres of India Ltd. v. Union of India, 1991 (54) E.L.T. 3 (S.C.) to consider the scope and purport of the "drawback" in the Act. The Settlement Commission....
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.... receipt lies in Section 75 of the Customs Act and Section 37 of the Central Excise Act. 18. Analysing the concept of remission of duty drawback and DEPB, we are satisfied that the remission of duty is on account of the statutory/policy provisions in the Customs Act/Scheme(s) framed by the Government of India. In the circumstances, we hold that profits derived by way of such incentives do not fall within the expression "profits derived from industrial undertaking" in Section 80-IB." (Emphasis supplied) 15. Reading of the aforesaid para and the analysis made by the Apex Court with respect to the concept of "duty drawback", one cannot dispute that it is nothing but a remission of duty on account of the statutory provision....