AI Drafter 
TaxTMI 
TaxTMI 
2023 (2) TMI 954
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....85 and 10699 of 2021, with consent of learned advocates for the respective parties, all the matters are heard together and are decided by this common Judgment. 3. The brief facts of the all these matters are epitomized as under : 3.1 Special Civil Application Number 7165 of 2021 : 3.1.1 The petitioners are engaged in business of export of ready-made garments falling under the Chapter Heading 61 and 62 of Customs Tariff Act, 1975. The petitioners are mainly exporting the goods to UAE and Africa. 3.1.2 The petitioners had exported various goods through various shipping bills during the period of 2011-2015. Such shipping bills were assessed finally by the proper officer and the said assessment had attained finality. Accordingly, the benefit of duty drawback pursuant to such assessment was given to the petitioners. 3.1.3 Respondent No.2 vide notice dated 16.03.2021 sought recovery of excess of the duty drawback so paid, during the year 2014-2015 under the provisions of Rule 16 of Duty Drawback Rules, 1995. 3.1.4 Therefore the petitioners have challenged such notice on various grounds, including the ground that the Show Cause Notice under Rule 16 cannot be issued beyon....
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....very of excess of the duty drawback so paid during the aforesaid period under the provisions of Rule 16 of Duty Drawback Rules, 1995. It was therefore this petition was preferred challenging such notice on various grounds including the ground that the Show Cause Notice under Rule 16 cannot be issued beyond a period of 3 years being reasonable period of limitation since no limitation is provided for under the Act or the Rules; 3.4 Special Civil Application Number 10699 of 2021: 3.4.1 The petitioners of this petition are engaged in business of export of Nuts, bolt, washer, hand tools etc. falling under the Chapter Heading 7318, 8205, 3926 of Customs Tariff Act, 1975. The Petitioners are mainly exporting the goods to Gulf and Upper Gulf Countries. 3.4.2 The petitioners had exported various goods through various shipping bills during the period 2011 to 2016. Such shipping bills were assessed finally by the proper officer and the said assessment had attained finality. Accordingly, the benefit of Duty Drawback pursuant to such assessment was given to the petitioners. 3.4.3 Respondent No.2 vide notice dated 24.03.2021 sought recovery of excess of the duty drawback so paid duri....
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....onal (supra), which is accepted by the other side, learned advocate for the petitioners, under instructions, does not press other contentions at this stage, keeping his right open qua those contentions / grievances and therefore, the same are not dealt with by this Court here. It would be open for the either party to raise and/or rebut the other contentions / grievances before appropriate authority / forum / Court, in accordance with law. 9. In that view of the matter, this Court need to travel beyond the main issue as to whether the respondent Authority can issue show-cause notice after a period of six/ten years for assessment / export. 10. Under these circumstances, it is necessary to take into consideration the period of export / assessment, date of show cause notice and period after which notices are issued, which are as under : Sr. No. Special Civil Application Number Period of Assessment / Export Date of SCN Period after which SCN issued 1 7165/2021 2011 to 2015 16.03.2021 01.04.2021 01.04.2021 20.05.2021 6 to 10 years 2 8600/2021 01/01/2014 to 31/12/2014 09/04/2021 7 years 3 8689/2021 2014 to 2015 05/05/2021 6....
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....Ludhiana examined the same and also recorded the statement of Mr.S.K.Chaudhary. The Order-in- Original indicated that there were parallel invoices to overvalue the shipping bills for availing drawback fraudulently by producing the overvalued invoices to the department of Customs at the time of export. 7.4 Act would be to refer to Rule 16 of the Drawback Rules, at this stage, which speaks of repayment of erroneous or excess payment of drawback and interest. "Rule 16. Repayment of erroneous or excess payment of drawback and interest. - Where an amount of drawback and interest, if any, has been paid erroneously or the amount so paid is in excess of what the claimant is entitled to, the claimant shall, on demand by a proper officer of Customs repay the amount so paid erroneously or in excess, as the case may be, and where the claimant fails to repay the amount it shall be recovered in the manner laid down in sub-section (1) of section 142 of the Customs Act, 1962." 7.5 It is quite clear from the said Rule that any amount of drawback and interest when paid erroneously or is paid in excess of the entitlement of the claimant, on demand by a proper officer of the....
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.... authority also held that the Drawback Rules are a self contained set of Rules made under section 75 of the Act and there is no time limit for issuance of demand notice for recovery of drawback paid erroneously or in excess under Rule 16 of the Drawback Rules. 9.2 The matter came up before this Court, where it firstly directed the review before the Revisional Authority and thereafter once again, when the petitioner approached before this Court, the Court held thus: "16. In the light of the facts and contentions noted hereinabove, the sole question that arises for consideration in this group of petitions is as to whether the concept of reasonable period is required to be read into rule 16 of the Drawback Rules which does not prescribed any period of limitation for recovery of drawback erroneously paid. 17. As noticed earlier, the drawback claims in all these petitions relate to the period between December 1995 to 1996, in relation to which, show cause notices came to be issued in February 2000. Thus, in all the cases, drawback claims had been processed and cleared before issuance of the clarification vide letter dated 20th September 1996 by the Commissione....
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....t, 1962. Thus, apparently rule 16 of the Rules does not provide for any time limit for making recovery of excess drawback paid erroneously. The question, therefore, is when rule 16 does not prescribe any period of limitation, whether action can be taken thereunder after any length of time, or whether the concept of reasonable period has to be read into it. In this regard, it is by now well settled by the Supreme Court in a catena of decisions that if the statute does not prescribe any period of limitation, the power thereunder has to be exercised within a reasonable time. What would be a reasonable period would, of course, depend upon the facts of each case. 19. In Government of India v. Citedal Fine Pharmaceuticals, Madras (supra), the Supreme Court has, in the context of rule 12 of the Medicinal and Toilet Preparations (Excise Duties) Rules 1956, which did not provide for any period of limitation, held thus: "6. Learned counsel appearing for the respondents urged that Rule 12 is unreasonable and violative of Article 14 of the Constitution, as it does not provide for any period of limitation for the recovery of duty. He urged that in the absence of any prescribed....
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....ng the facts of the present cases in the light of the aforesaid legal position, in all these cases, drawback had been paid to the petitioners between December 1995 and August 1996. Thereafter, despite a clarification having been issued as regards the interpretation of condition (c) of the Note under SS No.5404(1)(i) of the Drawback Schedule, no action was taken by the concerned authorities at the relevant time. It is only after a period of more than three years that show cause notices came to be issued to the petitioners seeking to recover the differential amount of drawback erroneously paid to them. Judging the period of delay from the armchair of a reasonable man, under no circumstances can the period of more than three years be termed to be a reasonable period for recovery of the amount erroneously paid. As held by the Supreme Court in the case of Collector of Central Excise, Jaipur v. M/s.Raghuvar (India) Ltd. (supra), where no period of limitation is prescribed, the courts may always hold that any such exercise of powers which has the effect of disturbing the rights of citizen should be exercised within a reasonable period of time. In the present case, the drawback had been pa....
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....onal authority observed that the issues were already decided by the Government in the interim order. The sole issue that was decided by the revisional authority in the said order was on the question of time limit for recovery of drawback. When the petitioners challenged the said decision before this court, the petitions were withdrawn with a view to file review applications before the revisional authority on the merits of the applicability of the maximum ceiling of Rs.62/- in cases falling under condition (c) of the Note under SS No.5404(1) (i) of the Drawback Schedule, on the ground that the revisional authority had not considered the said aspect and had laid emphasis on the limitation aspect of the matter. Thus, it is apparent that since in the earlier order, the revisional authority had considered the aspect of limitation only, review applications came to be filed before the revisional authority inviting a decision on merits as regards the applicability of the maximum ceiling to the cases of the petitioners. Viewed in the aforesaid context, the contention that as the question of limitation had not been raised before the revisional authority in the review applications, the petiti....
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....rt reported in 2007(211) ELT 23 (Madras) which was against the assessee. 9.6 This Court taking note of various decisions had directed that the action of the rejection of refund claim cannot be sustained and deserve to be quashed and set aside. While parting, the Court in very strong words disapproved the arbitrary act on the part of the lower adjudicating authority and in ignoring the binding precedents. Apt would be to refer to those words: "[6.0] In view of the above and for the reasons stated above and the decision of this Court in the case of NBM Industries (Supra), the impugned orders passed by the respondent No.4 rejecting the refund claims of the petitioner cannot be sustained and they deserve to be quashed and set aside and are accordingly quashed and set aside and the respondents - adjudicating authorities are hereby directed to sanction the respective refund claims of the claimant after following the law laid down by this Court in the case of NBM Industries (Supra) and pass fresh orders within a period of two months from the date of the receipt of the present order and to make the actual payment within a period of four weeks thereafter and also grant con....
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....ice delivery system. All efforts should be made by the authorities/quasi judicial authorities and judicial authorities to see that there is no multiplicity of proceedings and to pass the orders considering the binding decisions. It would also avoid unnecessary harassment to the parties as well as the unnecessary expenditure. [6.2] As observed hereinabove despite clear and unequivocal message by the pronouncement of the decisions by the Hon'ble Supreme Court as well as this Court, the message has not reached to the concerned authorities, we direct respondent No.2 - Central Board Excise and Customs, New Delhi to issue a detailed circular to all the adjudicating authorities considering the observations made by this Court in the present judgment and order as well as the law laid down by the Hon'ble Supreme Court in various decisions referred to in the present judgment and order, within a period of 30 days from the date of receipt of the present order so that such eventuality may not happen again and again." 13. The petitioner has approached this Court as the actions have been taken of issuance of the SCN in relation to the search made on 10.01.2015, the SCN has been i....