Customs, Excise and Gold Tribunal - Delhi
Minerals And Metals Trading ... vs Collector Of Customs on 5 December, 1986
Equivalent citations: 1987(11)ECR456(TRI.-DELHI), 1987(28)ELT128(TRI-DEL)
ORDER K.L. Rekhi, Member (T)
1. The appellants are aggrieved by the rejection of their refund claim for Rs. 1,61,257.79 on the ground of time bar under Section 27(1) of the Customs Act, 1962.
2. The facts, in brief, are that the appellants filed a bill of entry for clearing 6 stainless steel coils from bonded warehouse. However, by mistake, they entered therein the value of 12 coils cleared earlier from the same lot. The Customs Officer assessed the duty on the value as declared. The appellants paid the duty on 11-7-1978. They discovered the mistake some two years later when on 8-9-1980 they addressed a letter to the Assistant Collector requesting him to make a suo rnotu refund of the excess amount paid due to clerical error. The Assistant Collector rejected the claim as it was filed much beyond the time limit of six months prescribed in Section 27(1) for making refund appalications. In appeal, the Collector (Appeals) upheld the rejection. The appellants then filed a revision application before the Central Government which, on transfer of the proceedings, is now before us for disposal as an appeal. The prayer made in the revision application as well as that pressed before us during the hearing is that the assessing customs officer should rectify under Section 154 of the Act, the error which had arisen in his order of assessment on the bill of entry due to an accidental slip or omission and refund should accrue to the appellants as a consequence of such rectification.
3. Section 154 reads as under:-
"154. Correction of clerical errors, etc. - Clerical or arithmetical mistake in any decision or order passed by the Central Government, the Board or any officer of customs under this Act, or errors arising therein from any accidental slip or omission may, at any time, be corrected by the Central Government, the Board of such officer of customs or the successor in office of such officer, as the case may be."
We reproduce below Section 27 also which has been invoked by the lower authorities:-
"27. Claim for Refund of duty. - (1) Any person claiming refund of any duty paid by him in pursuance of an order of assessment made by an officer of customs lower in rank than an Assistant Collector of Customs may make an application for refund of such duty to the Assistant Collector of customs-
(a) in the case of any import made by any individual for his personal use or by Government or by any educational, research or charitable institution or hospital, before the expiry of one year;
(b) in any other case, before the expiry of six months, from the date of payment of duty:
Provided that the limitation of one year or six months, as the case may be, shall not apply where any duty has been paid under protest.
EXPLANATION. - Where any duty is paid provisionally under Section 18, the period of one year or six months, as the case may be, shall be computed from the date of adjustment of duty after the final assessment thereof.
(2) If one receipt of any such application the Assistant Collector of Customs is satisfied that the whole or any part of the duty paid by the applicant should be refunded to him, he may make an order accordingly.
(3) Where, as the result of any order passed in appeal or revision under this Act, refund of any duty becomes due to any person, the proper officer may refund the amount to such person, without his having to make any claim in that behalf.
(4) Save as provided in Section 26, no claim for refund of any duty shall be entertained except in accordance with the provisions of this section"
4. Section 26 deals with refund of export duty in certain cases. Since the appellants' case relates to import duty, section 26 is not relevant for the present discussion. It appeared to us that in view of the categorical provision of Sub-section (4) of Section 27, no refund of import duty could be considered outside the ambit of Section 27. We put our tentative view,'to the appellants and asked them to address arguments on it. The appellants stated that their claim was not under Section 27 but under Section 154. They were not asking for condonation of delay in submitting the [refund claim nor for application of the time limit of 3 years under the I Limitation Act. The bar of Section 27(4) could not, they argued, be construed in such a way as to nullify the provisions of Section 154. No time limit was fixed in Section 154 for rectification of clerical or arithmetical mistakes. The moment such a mistake was corrected under Section 154, they continued, the excess payment ceased to be duty and Section 27 ceased to apply to it. The appellants placed reliance on an order passed by the South Regional Bench of this Tribunal [1986 (24). E.L.T. 589 (Tribunal) - Collector of Customs, Madras v. Southern Sulphates and Chemicals (P) Ltd.] in which it was held that clerical mistake made in calculation of the amount of import duty could be corrected under Section 154.
5. The learned representative of the department stated that there was no clerical or arithmetical error in the order of assessment made by the customs officer. The error, if any, was in the bill of entry filed by the appellants and such an error could not be corrected under Section 154. For the same reason, the analogy of the Madras case aforesaid could not be applied to the appellants' case. The learned representative argued that the application made by the appellants before the Assistant Collector involved refund of import duty the authority for which lay in Section 27 of the Act and nowhere else.
6. We have given our earnest consideration to the submissions made by both sides. We agree with the learned representative of the department that facts of the Madras case are clearly distinguishable from the present one. In that case, the quantity, description and value of the goods had been correctly stated in the bill of entry. The assessing officer put down the rates of duty applicable against each item also correctly. It was the clerk/comptist who made the mistake inasmuch as for one item he calculated the duty at 100% instead of at the correct rate of 40% indicated by the assessing officer. In the case before us, the mistake, if any, was in the value of the goods declared by the appellants themselves. If the mistakes were in the rate of duty and/or in the tariff classification, the assessing officer could have detected it readily with the help of the tariff books with which he is equipped. He could detect the mistake in quantity, description or value also in the normal course of clearance in one lot of freshly imported goods for home consumption since in such cases the import invoice which gives the quantity, description and value of the goods is enclosed with the bill of entry and the assessing officer is required to check the bill of entry with the invoice. But since the subject bill of entry was an ex-bond bill of entry and it was for clearance of a part of the goods imported originally against one invoice, the mistake could not readily come to notice. It is, no doubt, a part of the assessing customs officer's duty to check whether there is any under-valuation or over-valuation of goods. But he does so when he suspects something wrong. He then undertakes detailed investigations and checks the price declared with standard price lists or with his record of previous importations. He does not make such detailed investigation for each and every bill of entry. Thus, when he accepted the value as declared by the appellants in the bill of entry filed by them, it cannot be said that he made a clerical or arithmetical mistake which he should be called upon to correct under Section 154.
7. Even assuming that an error had arisen in his order of assessment due to an accidental slip or omission, be it by the appellants or by the assessing customs officer, and that such an error was rectifiable under Section 154, still it would not be possible to grant any refund consequent upon such rectification as it would set at naught the mandatory bar of Section 27(4). The two provisions of the Act - Section 27 and Section 154 - have to be interpreted harmoniously so that neither is rendered nugatory. Refund involves a substantive review of the assessment made earlier. That is why Section 27 requires that such review should be undertaken by an appropriate higher officer - by the Assistant Collector in case the assessment had been made by an officer lower in rank than him or by the Collector (Appeals) if the assessment had been made by the Assistant Collector. Conversely, the same is true of short levy collection under Section 28 also. The customs officer who had made the assessment cannot himself review his order so as to result in grant of refund or collection of short levy. The view canvassed by the appellants that the assessing customs officer should rectify his order of assessment under Section 154 and consequent upon such rectification refund of Rs. 1.61,527.79 should be paid to them ignoring the provisions of Section 27 is, therefore, unacceptable. The doctrine of harmonious construction requires that the rectification envisaged under Section 154 should be such as not to involve refund or short levy demand. For the latter, the specific provisions of Section 27 and Section 28 have to prevail.
8. As the claim of the appellants for refund was clearly time-barred under Section 27(1), we uphold the lower orders and reject this appeal.