Customs, Excise and Gold Tribunal - Delhi
Ruby Products vs Collector Of Customs on 20 December, 1982
Equivalent citations: 1983ECR274D(TRI.-DELHI), 1983(12)ELT658(TRI-DEL)
ORDER H.R. Syiem, Member (T)
1. M/s. Ruby Products, Bombay imported acrylic sheets (off-cuts) by s.s. Vishva Mangal duty under Bill of Entry No. 1542D dated 13-4-78. The goods were assessed to customs duty plus countervailing duty under Item 15A~Central Excise Tariff on 24-10-79. The importers, M/s. Ruby Products claim refund of countervailing duty on the ground that as per notification No. 71/71-Central Excise dated 29th May, 1971 the acrylic sheets imported by them were exempted from Central Excise duty in excess of 30% ad valorem. This claim of refund was rejected by the Assistant Collector as time-barred, the duty having been paid on 13-4-78 whereas the refund claim was received in the Refund Department of the Bombay Custom House on 24-10-79. The importer's appeal to the Appellate Collector was rejected by the Appellate Collector of Customs, Bombay on the same ground, that is to say, that the claim for refund was time-barred under Section 27(1) of the Customs Act, 1962.
2. This appeal was posted for hearing today at New Delhi on 20-12-82, notice whereof was given to the importer on 16-11-82. By telegram dated 10-12-82 received on 11-12-82 by the Assistant Registrar of this Tribunal, the Appellant party requested the personal hearing be given by the Regional Bench of the Tribunal at Bombay instead of at Delhi on 20th December, 1982 since the issue involved is other than classification and value. In reply, a telegram dated 14-12-82 was issued to M/s. Ruby Products by the Assistant Registrar informing them that the matter pertains to classification and that adjournment requested had been rejected. M/s. Ruby Products did not appear at the hearing on 20-12-82.
3. The first and most important question to be decided is whether the claim for refund of duty dt. 24-10-79 made by M/s. Ruby Products before the Assistant Collector was barred under Section 27 of the Customs Act, 1962. The importers urge that the bar of Section 27 should not apply to their refund claim for the following reasons :
(i) The goods in question, as rigid plastic sheets are subject to CVD at 30%+1.5% SED under notification No. 71/71 of Central Excise dt. 29th May, 1971 as amended from time to time,
(ii) The assessment as well payment of excess duty has been by mutual mistake of fact and law.
(iii) The demand of duty in excess of 31.5% is deemed either in excess of jurisdiction or one not backed by any provision of law.
(iv) The payment of excess duty or recovery of excess duty at the rate of 50%+2.5% has been by mutual mistake of fact and law, and, therefore, under Section 72 of the Contract Act, they have a right to claim back the amount paid in excess of 30%+1.5% (Special Excise duty) within three years from the date they came to know about the mistake. The first time they came to know that the goods in question were assessable to CVD at the rate of 31.5% and/or the Exemption Notification No. 71/71 dt. 29-5-71 should have been made applicable to the goods, was, on or about 18-10-79, when they came to know Appellate Collector's Order in Appeal dated 24-9-79.
(v) The recovery of excess duty should be treated as made without authority of law and their case therefore attracts Section 72 of the Contract Law and not Section 27(1) of the Customs Act, 1962.
(vi) The Appellate Collector of Customs has overlooked the fact that in eleven Revision Applications, of similar type, Shri Venkateswaran, Joint Secretary to the Government of India, New Delhi in under his Order No. 8019-29 of 1969 of the Government of India on Customs Revision dated 8-12-69 had allowed all eleven Revision Applications being of the view that because goods in question did not attract additional duty of Customs under Section 2A of the Indian Tariff Act, the provisions of Section 27(1) were not applicable. The Appellate Collector has also overlooked the fact that Bombay High Court too has adopted the same view (as was taken by the Joint Secretary) in a Misc. Petition No. 666 of 1969.
4. The essence of the appeal is that the recovery of duty in excess of 31.5% was in excess of jurisdiction and was not backed by any provision of law. The payment of the excise duty at the rate of 50%+2.5% was by reason of mutual mistake of fact and law and that therefore under Section 72 of the Contract Act, they had a right to claim the amount paid in Excess of 30% plus 1.5% payable under Central Excise Notification No. 71/71 dated 29-5-71. The recovery of excise duty should therefore be treated as without the authority of law and their case decided in accordance with Section 72 of the Contract Act and not Section 27 of the Customs Act, 1962. The importers also urge that in 11 revision applications of similar nature, the Joint Secretary to the Government of India in order No. 8019-29 of 1969 dated 8-12-69 had allowed all the revision applications taking the view that because the goods did not attract additional duty of customs under Section 2A of the Indian Tariff Act, the provisions of Section 27(1) were not applicable. Furthermore, the Bombay High Court had also adopted the same view as taken by the Joint Secretary in Misc. Petition No. 666 of 1969.
5. The 11 revision applications allowed by the Joint Secretary in his Orders No. 8019-29 of 1969 dated 8-12-69 are said to have been allowed on the grounds that the goods did not attract additional duty of customs under Section 2A of the Indian Tariff Act and so Section 27(1) was not applicable. This argument fails in this case before us because it is not their importer's claim that the goods in question i.e. acrylic sheets (off-cuts) were not liable to additional duty popularly known as countervailing duty.
6. We should like to cite a judgment of the Supreme Court in AIR 1976 S.C. 638 in the case of Madras Rubber Factory Ltd. v. Union of India and Ors.. In this case the importers M/s. Madras Rubber Factory imported raw materials including Pyratex Vinyl Pyridine Latex used in the manufacture of rubber tyres and tubes. The Customs authorities had been charging customs duty on V.P. Latex under Item 87 of the Indian Tariff Act, 1934 instead of Item 39, an item meant for charging duty on raw rubber. The customs duty charged under Item 87 was much more than the one chargeable under Item 39. The countervailing duty under Item 15A of the Central Excise Tariff was also charged if the article imported was not treated as raw rubber. On the 5 consignments of Latex imported by the appellant in the year 1968, customs duty was charged under Item 87. Subsequently, M/s. Madras Rubber Factory filed 5 applications before Assistant Collector under Section 27(1) of the Customs Act, 1962 for refund of the excess amount of duty charged. The refund claim in respect of 5 consignments were late by periods ranging from 1 month to 4 months. In partial justification of the lateness of their claim for refund, the factory said that it had been paying duty under protest. The facts, however, were otherwise, and the Court found that the protest was not in respect of the 5 consignments and therefore was not relevant to the goods before it. As the letter of protest related to a consignment of 59 items of V.P. Latex which could not be connected with any of the 5 consignments in question, the Court went on to pronounce that the view taken by the authorities could not be shown to be incorrect. It, therefore dismissed the appeal.
7. This decision conclusively established that an application for refund under the provisions of the Customs Act, as is in the present case, gets barred if made beyond the period prescribed in terms of Section 27 of the Act. It does not appear that any period of limitation other than that contained in Section 27 governs an application for refund. The three year period of limitation under the Limitation Act, relied upon by the Appellant, is for a suit in a Civil Court on a cause of action arising under Section 72 of the Contract Act and not for an application for refund under the provision of the Customs Act, 1962.
8. In this case, the duty was paid on 13-4-78 whereas the claim for refund of duty was received by the Refund Department of the Custom House on 24-10-79, far beyond the time-limit of 6 months specified by Section 27 of the Customs Act, 1962. We have therefore no hesitation in holding that the decision of the lower authorities to treat the refund claim as barred by limita-ton to be correct.
9. The appeal in accordingly dismissed.