Custom, Excise & Service Tax Tribunal
M/S. Ferromatik Milacron India Ltd vs Commissioner Of Customs(Import), Jnch ... on 29 December, 2010
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI
COURT NO. II
APPEAL NO. C/1018/09 Mum
(Arising out of Order-in-Appeal No. 390(CRC-1)/2009 (JNCH)/IMP-38 dated 31.7.09 passed by the Commissioner of Customs (Appeals), JNCH Sheva)
For approval and signature:
Honble Shri Ashok Jindal, Member (Judicial)
1. Whether Press Reporters may be allowed to see : No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Yes
of the Order?
4. Whether Order is to be circulated to the Departmental : Yes
authorities?
M/s. Ferromatik Milacron India Ltd.,
:
Appellant
Versus
Commissioner of Customs(Import), JNCH Sheva
Respondent
Appearance Shri Anil Balani, Advocate for Appellant Shri V.K. Singh, SDR for Respondents CORAM:
Shri. Ashok Jindal, Member (Judicial) Date of Hearing : 29.12.10 Date of Decision : 29.12.10 ORDER NO.
The appellant is in appeal against the order of denial of their refund claim of excess duty paid on short shipment of the parts.
2. The facts of the case are that the appellant had imported second hand capital goods and filed Bill of Entry for clearance of the same. In fact, two boxes were left out at the suppliers end and, subsequently, these two boxes were shipped again along with documents such a shipped verification, Chartered Engineers certificate and same were imported by the appellant through another Bill of Entry. On the assessment of both the Bills of Entries, the appellant paid duty and cleared their goods. Thereafter, the appellant filed a refund claim for the excess duty of custom paid by them while clearing the goods originally on account of short shipments which were later supplied by the foreign supplier. The refund claim of the appellant was rejected on two grounds:-
(a) Inspection of short shipment of goods was not carried out in the presence of Central Excise and custom authorities.
(b) The appellant has not challenged the assessment of Bill of Entry.
3. Aggrieved by the order, the appellant is in appeal before this Tribunal.
4. Shri Anil Balani, learned Advocate appearing for the appellant submits that it is not in dispute that the goods have been short shipped by the foreign supplier and same were cleared on payment of duty. The only issue that no inspection was carried out on short shipment of goods in the presence of customs authorities is having no merits in the light of the decision of this Tribunal in the case of Commissioner of Customs, Chennai vs. Manipal Power Press - 2006 (194) ELT 193 (Tri. Chennai). With regard to the denial of credit on the ground that the assessment has not been challenged, he relied on the decision of Board of Trustees of the Port of Mormugao vs. Union of India - 1993 (68) ELT 39 (Bom.).
5. On the other hand the learned DR for the Revenue relied on the decision of Commissioner of Customs vs Guindy Machine Tools Ltd. - 2004 (171) ELT 424 (Tri. Chennai) wherein this Tribunal has taken a view that in case of short shipment found after the consignment gone out of customs charge, not amounts to short shipping. He also relied on the decision of Priya Blue Industries Ltd. vs. Commissioner of Customs (Preventive) 2004 (172) ELT 145 SC saying that the appellant has not challenged the assessment of Bill of Entry the refund claim is not maintainable.
6. Heard and considered the submissions.
7.1 The issue in hand is that the refund claim has been denied on two counts:-
1. Inspection of short shipment has not been carried out in the presence of customs authorities.
2. The assessment of original Bill of Entry has not been challenged by the appellant.
Whether the refund claim is maintainable or not with regard to short shipment of goods in the absence of inspection made before the customs authorities has been clarified by the Board. As per Boards Circular No. 24/04-Cus dated 18.03.2004 the Board has clarified as under:-
On import or export of goods, at times, it is found that duty has been paid in excess of what was actually leviable on the goods. Such excess payment may be due to lack of information on the part of importer/exporter or non-submission of documents required for claim of lower value or rate of duty. Sometimes, such excess payment of duty may be due to shortage / short landing, pilferage of goods or even incorrect assessment of duty by customs. In such cases, refund of excess amount of duty paid can be claimed by the importer or exporter. If any excess interest has been paid by the importer / exporter on the amount of duty paid in excess, its refund can also be claimed. Section 27 of the Customs Act, 1962 refers in this regard. The refund of any duty and interest, can be claimed either by a person who has paid the duty in pursuance to an order of assessment or a person who has borne the duty. 7.2 Further in case of Manipal Power Press (supra) this Tribunal has held that when convinced that the foreign supplier had short shipped the imported goods, duty already having paid on such short shipped goods, the respondents are entitled for refund of duty. The case cited by the learned DR in the case of Guindy Machine Tools Ltd (supra) is distinguishable in the facts of the case in hand. The said decision was given relying on the decision in the case of Uniferro International Ltd. vs. Collector of Customs, Bombay 1986 (26) ELT 652 (Tri.) wherein the facts are somehow different as in that case the assessee could not able to prove that the supplier had short shipped the goods. Hence, the decision cited by the learned DR is of no help to the Revenue as the same are distinguishable.
7.3 In the case of Board of Trustees of the Port of Mormugao (supra), the Honble Bombay High Court has held that in case the duty is recovered in respect of items which are not even imported, then the bar of Section 27 of the Act will not be attracted. 7.4 In the light of the above discussions, I find that on both the counts the refund claim of the appellant is maintainable as it is not disputed that the goods have been short shipped and the appellant has paid duty on the goods which has been short shipped. Moreover, the appellant has been able to prove the confirmation of short supply of the goods from the supplier, hence relying on the decision on Manipal Power Press (supra), the refund claim is maintainable.
8. In the light of the Boards Circular No. 24/04 dated 18.03.2004, the Board itself has clarified that in case of short shipment of goods, refund claim of excess duty paid by the assessee is maintainable. Hence, the decision of Priya Blue (supra) is not applicable to the facts of the case in the light of the decision of High Court in the case of Board of Trustees of the Port of Mormugao (supra). Accordingly, the refund claim of the appellant is maintainable on both the counts.
9. In the light of above discussions, the impugned order is set aside and the appeal is allowed with consequential relief.
(Dictated in Court) (Ashok Jindal) Member (Judicial) nsk 5