TaxTMI 
TaxTMI 
2025 (4) TMI 382
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....es service of notice of rule on behalf of the respondents. 3. By these petitions under Article 226 of the Constitution of India, the petitioners have challenged the show cause notices issued by respondent no. 2 Joint Commissioner, Customs, Mundra, Kutch. The show cause notices were issued in the year 2016. 4. The petitioner is engaged in the business of export of nut, bolts, washer, hand tools etc. falling under Chapter Heading 7318, 8205, 3926 of the Customs Tariff Act, 1975. The petitioner is exporting the said goods to Dubai, UAE. 5. Respondent no. 2 based upon the intelligence seized the containers of the petitioner along with other exporters on 20.01.2015 on the ground that the goods are under weighing and are not properly classified. According to respondent no. 2, the goods were required to be classified under Chapter Heading 7308 and not under Chapter heading 7318 and therefore, the same was considered as mis-declared goods. 6. The petitioners preferred Special Civil Application No.7305 of 2015 challenging the condition imposed by respondent no. 2 for provisional release of the seized goods which was modified by this Court requiring the petitioner to give bond fo....
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....and others reported in (2007) 8 SCC 338. 4) M/s. Godrej Sara Lee Ltd. v. The Excise and Taxation Officer cum Assession Authority reported in (2023) 384 ELT 8 (SC) 12. It was further submitted that the shipping bills in question were finally assessed, and the petitioners were granted the benefit of duty drawback and the goods in question have already been exported out of India and have reached their respective destination. It was further pointed out that duty drawback for the entire period from 1st January 2011 to 30th September, 2016 was already paid to the petitioners and Bank Realisation Certificates have been issued upon realization of the consideration in foreign exchange declared in the shipping bills. It was also pointed out that no appeal challenging the final assessment of the shipping bills is preferred by the respondents and appeal period has already lapsed. 13. It was submitted that the impugned show cause notices are liable to be quashed as the same are not adjudicated upon by the authority from 2016 till 2023, more particularly, when the impugned notices are for goods exported by the petitioners from 01.01.2011 to 30.09.2016 and therefore, show cause not....
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....differential duty drawbacks under the said Rule. It was submitted that though the Rule 16 of the Drawback Rules is silent as to the period during which the show cause notice can be issued by the authority, however, in similar issue, this Court in case of Pratibha Syntex Limited v. Union of India and others (judgment dated 04.07.2022 rendered in Special Civil Application No. 2039 of 2004) has held that the period for issuance of show cause notice under Rule 16 would be three years from the date of duty drawback being paid. It was therefore, submitted that the impugned show cause notices and subsequent proceedings initiated by respondent no. 2 are beyond the period of limitation prescribed by this Court. The decision of this Court was followed in various other decisions and the SLP filed against such decision including the review petition preferred by the respondents have been rejected by Hon'ble Supreme Court. 17. Learned advocate Mr. Dave further submitted that as per section 128 of the Customs Act, any person including the department if aggrieved by the final assessment must file an appeal before the stipulated time frame and if no appeal is filed, assessment would attain final....
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.... assessees and chaos in administration of tax laws." 21. It was therefore, submitted that respondent no. 2 has failed to follow the binding precedent of appellate authority, revisional authority and this Court wherein it is already held that classification of such goods sought to be exported by the petitioner and other exporters would be item specific and not as per end use and classification made by the exporters in Chapter Heading No.7318 was held to be proper. It was submitted that despite such binding decisions, the respondents have continued to issue the show cause notices to reopen the assessment on the ground of classification and as such, the show cause notices are without jurisdiction. Reliance was placed on the following decisions: 1) M/s. S.J.S International (Special Civil Application No. 20484 of 2019). 2) Gargip International v. Union of India (Special Civil Application No. 17255 of 2016). 3) Vinod Electropating Works(order dated 19th November, 2015 of Appellate Commissioner). 4) Vinod Electropating Works, (order dated 1st /3rd February, 2022 of revisional authority). 5) Hind Steels, Additional Commissioner (Export) order....
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....ff Head (CTH) 7308 were wrongly classified under CTH 7318 and 8205 where duty drawback rate was higher and overvaluation was done to claim higher incentives. 26. It was therefore, submitted that after inquiry being initiated against the petitioner and during the investigation the goods were seized on reasonable belief that the same were liable for confiscation. It was submitted that merely because the goods were provisionally released, it cannot be said that show cause notices cannot be issued if during the investigation it is revealed that there is short shipment, mis-classification and over valuation of exported goods. It was therefore, submitted that the impugned show cause notices are issued for recovery of fraudulently availed excess duty drawback by the petitioners under Rule 16 of the Drawback Rules read with section 75 of the Customs Act. It was submitted that though relied upon documents and evidence have been provided to the petitioners to represent their case before the adjudicating authority, the petitioners have not complied with the impugned show cause notices. 27. It was submitted that as per Circular No. 24/2011 dated 31.05.2011 issued by the Central Board of ....
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....he report of the Chartered Engineer, it was found that after investigation of the samples of the goods that these were parts of scaffolding items, and such fact is accepted by the partner of the petitioners in statement recorded by the officer of DRI. 31. It was therefore, submitted that the issues raised by the petitioners can also be considered by the adjudicating authority during adjudication process. 32. In support of his submission, reliance was placed on the decision of Calcutta High Court in case of M M Exports v. Zonal Director General of Foreign Trade reported in 2001 (133) ELT 558 (Cal.) wherein it is held that officer of the Customs Department is competent authority for assessment and reassessment of the value of goods. It was therefore, prayed that no interference may be made in these petitions and respondent no. 2 may be permitted to adjudicate the show cause notices in accordance with law. It was further submitted that reliance placed by the petitioners on various decisions are based upon the facts which are different and present case cannot be compared with other consignments not covered by investigation by DRI as show cause notices in the present case have bee....
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....tioners to the impugned show cause notices, is that the show cause notices are without jurisdiction as the same are not adjudicated for more than seven years and approaching respondent no. 2 for adjudication of the show cause notices would not be an efficacious remedy for the petitioners as respondent no. 2 has no jurisdiction to issue the show cause notices in the facts of the case, more particularly, when such show cause notices are time barred and respondent no. 2 has failed to take into consideration the binding precedent. 35. This Court in case of M/s. SJS International (supra) in similar facts after considering similar contentions raised by the petitioners and the respondents in the said case, examined Rule 16 of the Drawback Rules as under: "7.4 Apt 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 dem....
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....in 2013(29) STR (208) Gujarat wherein it had been held that on inputs used in manufacturing of goods cleared by DTA units to 100% Export Oriented Unit (EOU), refund of CENVAT credit is available and the same cannot be denied on the ground that the case was of deemed export. It was insisted that the refund would be granted only in case of physical export. This Court disapproved non following of a binding decision and despite the direction of this Court, the respondent had rejected the refund claims of the claimant on the ground that the decision of NBM Industries (supra) is the case of another assessee and not in the case of claimant and each one must fight its own battle and must succeed or fail in such proceedings. It also had relied on the decision of the Madras High Court 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.....
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....ltantly, petition stands allowed. Both the show cause notices dated 21.8.2012 and 22.1.2013 are quashed and struck down." It appears that still the message has not reached the concerned authorities in following the binding decisions of the higher appellate authorities and/or courts solely on the ground that the same is in the case of another assessee. Such a conduct is also required to be viewed from another angle. This would not only amount to disregarding the direction of the court rendered in earlier petitions but would also lead to multiplicity of proceedings. When the courts are overburdened and are accused of arrears, it is the duty of the concerned authorities to avoid multiplicity of proceedings and lessen the burden of the courts. Being a part of the justice 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 pronou....
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.... goods on furnishing the bond of 100% value and accordingly, goods were provisionally released for the exports by the custom authority. 12. This Court notices the detailed Order-in-Original adjudicating the SCN against which there is already a channel of appeal provided and thereafter, if the party is still aggrieved, the revisional authority can also be approached by the litigating party. However, here previously SCN of dated 12.01.2016 in relation to the seized goods was already issued and yet, another SCN is issued, the revenue has not challenged what has been held favoring the petitioner and the petitioner has challenged it on the ground of breach of principles of natural justice as well as on substantive issues. 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 issued on 09.02.2018. It is thus clear that for the export which had been made in the years 2011 to 2015 and for the shipping Bills of 01.01.2015 for which the duty drawback had been given to the petitioner in the year 2016, this action has been initiated before expiry of a period of three ye....
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....he period of three years of payment of the duty drawback, and that being a settled legal position, if not regarded, this Court needs to interfere. Again, the proper officer who assesses the shipping bills will be in a position to reopen the same provided that there is such a stage of reopening the shipping bill filed once are self assessed, that would attain finality upon the proper officer clearing the same. Had there been any discrepancy, the proper officer would not consider the self assessment final and would obviously assess the shipping bill before finalizing. 17. In the instant case, the shipping bills had been finally assessed and the assessment had attained finality. The aggrieved party having any issue on the classification would need to approach the appellate authority instead of reopening the assessment by issuing the show cause notice. The appeal appears to have become time barred as averred by the petitioners, the show cause notice is on account of the misclassification. 18. However, the Court needs to regard that the core issue raised in SCN is of classification which is concluded, and no challenge is made by the revenue. It has also questioned this....