2004 (96) ECC 573 (Tri)

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL

East Zonal Bench -- Kolkata

Shri V.K. Jain, Member (T) and Shri M.P. Bohra, Member (J)

Haldia Petrochemicals Ltd.

Versus

Commissioner of Customs, Kolkata

Appeal No. CDM-235/03

[Arising out of Order-in-Appeal No. Kol/CUS/94/CKP/03 dated 16.9.03 passed by Commissioner of Customs (Appeals), Kolkata]

Order No. A-389/KOL/2004, dt. 17.6.2004, Certified on 28.6.2004

Refund

Goods under Customs Control -- Section 74, Customs Act -- Re-export of the goods vis-a-vis drawback claim only arises when the goods have been taken release of the Customs Control -- The duty was paid on the goods imported. But it is a fact that it was paid before the goods were examined and found that the goods were missent by the foreign supplier. The goods were sent by the Customs Authorities on their own when they were satisfied that the goods were wrongly sent to the appellants. The appellants submitted that preferring of drawback claims under the provisions of Section 74 of the Customs Act, does not arise. Since the goods never came out of the Customs Control, the duty paid by the appellants is required to be refunded.

[Para 2]

Customs Act, 1962

Section 74 -- Applicability -- Goods under Customs Control -- Sent back because goods were missent by foreign supplier -- Section 74 of the Customs Act, 1962 is not applicable in this case, as the goods have never come under the control of the appellants and have been sent back by the Customs Authorities on their own when they were satisfied that the goods were wrongly sent to the appellants by the foreign supplier.

[Para 5]

PRESENT :

Shri B.N. Chattopadhyay, Consultant for the appellant.

Shri A.K. Mondal, SDR for the respondent.

Case Cited :

Indian Charge Chrome Ltd. v. Commissioner of Central Excise & Customs, BBSR-I, 2001 (132) ELT 300 (Tri.-Kolkata)................................................................................................................... [Para 3]

Per : V.K. Jain

The present appeal is directed against the Order-in-Appeal No. KOL/CUS/94/CKP/03 dated 16.9.2003 by M/s. Haldia Petrochemicals Ltd., Kolkata. The issue in the present appeal relates to the admissibility of the Refund Claim filed by the appellant company. The brief facts of the case are that the appellants imported mechanical spares and presented Bill of Entry dated 26.7.2000 and paid the duty amount of Rs. 8,35,563.00 (Rupees eight lakh thirty-five thousand five hundred and sixty-three) on the assessment thereof. However, on examination of the goods, it was found that the goods were different from that declared/mentioned in the invoice/Bill of Entry/Packing List. The appellants relinquished the title on the goods. They also stated that they had got no objection if the Customs allowed the foreign supplier or their authorised representative to send back the goods wrongly supplied to them. They submitted that the goods were never cleared from the Customs Control and were not received by the appellants. The Commissioners(Appeals) has held that in the present case, since the goods have not been cleared and instead, the goods were exported immediately after importation, refund of duty paid on the importation of the goods would be governed by the provisions of Section 74 of the Customs Act, 1962. He also held that the appellant company was statutorily required to apply for duty drawback. Having not done so, the appellant company cannot seek relief under Section 27 of the Central Excise Act, and as such, the appeal filed by the appellants was rejected by the Commissioner (Appeals).

2. We have heard Shri B.N. Chattopadhyay, learned Consultant for the appellants. He submits that re-export of the goods vis-a-vis drawback claim only arises when the goods have been taken release of the Customs Control. The duty was paid on the goods imported. But it is a fact that it was paid before the goods were examined and found that the goods were mis-sent by the foreign supplier. The goods were sent by the Customs Authorities on their own when they were satisfied that the goods were wrongly sent to the appellants. The appellants submitted that preferring of drawback claims under the provisions of Section 74 of the Customs Act, does not arise. Since the goods never came out of the Customs Control, the duty paid by the appellants is required to be refunded. The appellants have preferred the refund claim on that basis, inasmuch as the goods were not re-exported by them, but were sent back by the Customs Authorities.

3. Learned Consultant, Shri Chattopadhyay submitted a copy of the C.E.G.A.T.'s decision in the case of Indian Charge Chrome Ltd. v. Commissioner of Central Excise & Customs, BBSR-I, 2001 (132) ELT 300 (Tri.-Kolkata).

4. Shri A.K. Mondal, learned SDR for the Revenue reiterated the Order of the Commissioner (Appeals).

5. We have heard both sides. We agree with the appellants that Section 74 of the Customs Act, 1962 is not applicable in this case, as the goods have never come under the control of the appellants and have been sent back by the Customs Authorities on their own when they were satisfied that the goods were wrongly sent to the appellants by the foreign supplier. We find considerable force in the submissions of the appellants and we allow the appeal of the appellant company with consequential reliefs.

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