TaxTMI 
TaxTMI 
2025 (12) TMI 252
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.... and determined admissible Drawback claim on the basis of classification of the goods determined by him. Aggrieved by the classification of the exported goods done by the Ld. Principal Commissioner and consequent fixing of drawback to the said goods exported, the appellant has filed this appeal. 2. The appellant submits that the drawback is to be given by the Custom authorities and shipping bill is to be treated as drawback claim. The appellant has mentioned that all the goods exported by the appellant are readymade garments and they are all eligible for classification under a single Tariff Heading and the drawback claim is to be fixed accordingly. However, in the impugned order, the Ld. adjudicating authority has classified the goods under various subheadings such as CTHs 6102, 6103, 6104, 6105 and 6106, without giving any proper reason for such classification and determined different rates of drawback. 2.1. It is the case of the appellant that the Department has not conducted any Test on the goods exported by them to ascertain the constituent materials; as per the description of the goods mentioned by them in the shipping bills, all the goods exported were 'ready-made garme....
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....ired for conversion of the shipping bills; thus, the delay in conversion of the shipping bills cannot be attributed to be on the part of the appellant; the Department has delayed the conversion of the shipping bills and finally allowed the conversion vide the order dated 17.09.2025, on the basis of same set of documents furnished by them earlier. 3.3. Thus, it is the appellant's stand that they cannot be held responsible for the delay in conversion of the shipping bills in question and accordingly, have prayed for allowing interest thereon, from the date of the Order passed by the Tribunal allowing conversion of the 8 shipping bills, i.e., from 16.10.2001, in respect of all the 34 shipping bills. 4. The Ld. Authorized Representatives of the Revenue reiterated the findings in the impugned order. They submit that the adjudicating authority has classified the goods exported, on the basis of the details available in the shipping bills; as the goods were originally not exported under the claim of drawback, no tests were conducted. Thus it is their submission that the adjudicating authority has no other option to classify the goods. 4.1. Regarding the claim of interest by the ap....
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..... Shipping Bill No. CTH Drawback Serial No. DBK Rate Quantity (Pcs.) Net Weight (Kgs.) Drawback admissible (in Rs.) 1 DEEF- 1128 610444.02 2706 Rs.22.2per Kg 6000 1425.00 31635.00 2 DEEF- 1126 610444.02 2706 4100 563.75 12515.25 3 DEEF- 1129 610444.02 2706 1900 376.80 8364.96 4 DEEF- 1130 610444.02 2706 250 143.00 3174.60 5 DEEF- 1131 610444.02 2706 1500 508.40 11286.48 6 DEEF- 1127 610444.02 2706 5760 1954.8 43396.56 7 DEEF- 1237 610452.00 2706 26000 3575.00 79365.00 8 DEEF- 1236 610444.02 2706 12500 3250.00 72150.00 9 DEEF- 212 610443.01 2706 10000 1130.00 25086.00 10 DEEF- 213 610443.01 2706 5000 1491.00 33100.20 11 DEEF- 214 610443.01 2706 5000 1491.00 33100.20 12 DEEF- 215 610343.00 2705 Rs. 14.8 per Kg 35000 875.00 12950.00 13 DEEF- 242 610230.01 2704 10% of FOB (max. Rs 45/piece) 15900 3955.92 715500.00 [calculated for Rs. 45/pc.] 14 DEEF- 243 610443.01 2706 Rs. ....
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....ng to classify the goods exported under different subheadings such as CTHs 6102, 6103, 6104, 6105 and 6106. The submission of the Appellant is that all the goods exported were 'knitted ready-made garments' classifiable under the CTH 6102. Before going into the classification, we would like to examine the different rates of drawback available for the goods classifiable under the Chapter 61. 7. In the impugned order, the ld. adjudicating authority has mentioned the drawback rates for goods covered under Chapter 61, as per Public Notice No. 5/1995 dated 15.06.1995, which is reproduced below for ready reference: - CTH Drawback Sl. No. Description of Goods Rate of Drawback 6101 2701 Articles of Apparel and Clothing accessories, Knitted or Crocheted Rate to be fixed on application from individual manufacturers/ exporters in accordance with Drawback Rules 6102 2704 Knitwear and articles of hosiery including ready-made garments made wholly or mainly from knitted/hosiery fabrics of cotton and/or cellulosic yarn 10% of FOB value subject to a maximum of Rs. 45/- per piece 6103 2705 Knitwear and articles made wholly from hosiery/knitted fabri....
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.... to some of these goods under the shipping bills in question, has adopted the classification under CTH 6102. Having considered the documentary evidence available on record, we are of the view that all the knitted readymade garments exported by the appellant under the shipping bills in question are classifiable under the CTH 6102 and the drawback rate for the said goods are to be fixed as per the entry corresponding to the CTH 6102 [pertaining to Drawback Sl. No. 2704], as mentioned in paragraph 7 of this order (supra). 9.1. As far as the classification adopted by the adjudicating authority under CTH 6110, primarily in respect of 'Wind Cheaters' exported, we agree with the classification adopted by the Ld. adjudicating authority. Therefore, we uphold the classification and consequent calculation of drawback arrived at in the impugned order in respect of these goods. 10. In view of the above findings, we hold that the goods covered under the 34 shipping bills [as listed in the Table at paragraph 8 of this Order] are required to be classified as under for the purpose of computation of eligible amount of drawback: - (i) Sl. Nos. 1 to 32: CTH 6102. (ii) Sl. Nos. ....
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....d the Order dated 17.10.2018, wherein he has rejected the request for conversion of all the 34 shipping bills. The said rejection was set aside by this Tribunal vide Final Order No. 75487 of 2025 dated 28.02.2025. 11.3. We find that the CESTAT vide Final Order No. 75487 of 2025 dated 28.02.2025 finally held that the appellant is entitled for conversion of the shipping bills in question from DEEC scheme to drawback scheme and directed the adjudicating authority to finalize the drawback claim of the appellant in accordance with law. Thereafter, vide Order-in-Original No. KOL/CUS/PR.COMMISSIONER/DBK/PORT/41/2025 dated 17.09.2025 impugned herein, the adjudicating authority allowed the conversion of the Shipping Bills in terms of the CESTAT Order dated 28.02.2025. However, he has not granted any interest for the delayed sanction of the drawback. 11.4. Thus, from the above, it is clear that after the CEGAT Order dated 16.10.2001, the appellant had filed the Writ Petition in the Hon'ble Calcutta High Court, which was disposed by the Hon'ble High Court vide Order dated 16.07.2018. Hence, during the pendency of the said Writ petition in the Hon'ble Calcutta High Court, the....
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....T has to be considered as the 'relevant date' for computation of the interest in respect of these 8 shipping bills. Accordingly, in respect of these 8 shipping bills, the appellant should be eligible for interest after three months from the date of passing of the Tribunal's Order dated 16.10.2001. 11.5.1. However, we find that for the remaining shipping bills no formal conversion was allowed and there was no drawback eligible to the appellant. We note that the order for rejecting the conversion was passed on 17.10.2018, but this order was set aside and conversion of these shipping bills into drawback shipping bills was allowed, on the same set of facts as existed on 17.10.2018, by the order of the Tribunal dated 28.02.2025. Accordingly, we hold that the appellant should be eligible to interest after three months from the date of passing of the order dated 17.10.2018. 11.6. In this regard, we refer to the decision of this Tribunal in the case of Vedanta Ltd. v. Commissioner of Customs (Ports), Kolkata [Final Order No. 75010 of 2025 dated 07.01.2025 in Customs Appeal No. 76391 of 2024 (CESTAT, Kolkata)], wherein interest has been granted for delay in finalization of provisional....
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....sion in the Income-tax Act, 1961 ("the Act") for grant of such compensation, this Court had upheld the view of the Gujarat & Madhya Pradesh High Courts that compensation should be granted (whether called interest or otherwise) and hence the impugned judgment was contrary to a decision of this Court and ought to be reversed? E. Whether the High Court ought to have held that sections 240 and 244 of the Act refer to 'refund of any amount', which phrase clearly includes any amount (including interest) due by the Income Tax department to the assessee, and hence the appellant was entitled to interest on the delay in the payment of amounts due from the Income-tax department ? Provisions of Income Tax Act : 243. Interest on delayed refunds. (1) If the Income-tax Officer does not grant the refund (a) in any case where the total income of the assessee does not consist solely of income from interest on securities or dividend, within three months from the end of the month in which the total income is determined under this Act, and (b) in any other case, within three months from the end of the month in which the claim for refund is m....
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.... to appreciate that section 240 of the Act, which provides for refund by the Revenue on appeal etc., deals with all subsequent stages of proceedings and therefore is phrased in terms of 'any amount' becoming due to an assessee. The facts and the law referred to in paragraph (supra) would clearly go to show that the appellant was undisputably entitled to interest under Sections 214 and 244 of the Act as held by the various High Courts and also of this Court. In the instant case, the appellant's money had been unjustifiably withheld by the Department for 17 years without any rhyme or reason. The interest was paid only at the instance and the intervention of this Court in Civil Appeal No. 1887 of 1992 dated 30.04.1997. Interest on delayed payment of refund was not paid to the appellant on 27.03.1981 and 30.04.1986 due to the erroneous view that had been taken by the officials of the respondents. Interest on refund was granted to the appellant after a substantial lapse of time and hence it should be entitled to compensation for this period of delay. It is a case of the appellant as set out above in the instant case for the assessment year 1978-79, it has b....
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....hree months from the date of the Let Export Order (LEO). ...." 12. Thus, our findings, on the issue of interest, are summarized as under: - (i) Out of the 34 shipping bills, the Tribunal had allowed conversion of 8 shipping bills, vide its Order dated 16.10.2001. We find that these 8 shipping bills were also formally converted into drawback shipping bills only in the order dated 17.09.2025. Since these 8 shipping bills were allowed conversion vide the Tribunal's Order dated 16.10.2001, we hold that these 8 shipping bills should be deemed to have been converted w.e.f. 16.10.2001. Thus, the appellant would be eligible for interest for the drawback sanctioned in respect of these 8 shipping bills, from three months after the passing of the CEGAT Order dated 16.10.2001 till the date of sanction of drawback. (ii) In respect of the remaining shipping bills, the delay if any on the part of the Department can only be attributed from three months after passing of the order dated 17.10.2018 only whereby the claim of the appellant was rejected. Thus, the appellant would be eligible for interest for the drawback sanctioned in respect of the remaining shipping bills, from th....