Read judgment: Sony India Pvt. Ltd. vs. Union of India
Hyderabad, August 26, 2021: The Telangana High Court has ruled that in refusing to amend the Bill of Entry (BoE) under section 149 of the Customs Act to enable the importer (petitioner) to claim refund of the excess duty paid, the Assessing Authority has caused great injustice to the petitioner.
A Division Bench of Justice M S Ramachandra Rao & Justice T Vinod Kumar observed that such refusal by the Customs Department amounts to violation of Articles 14, 19(1)(g), 265 and 300A of the Constitution of India and also the Customs Act, 1962.
Going by the background of the case, at the time of import of mobile phones in the BoE, petitioner had not claimed any exemption. Instead he contended eligibility to avail the benefit of reduced rate of 1% CVD (Countervailing Duty) and sought to claim benefit of the Exemption Notification for import of Mobile handsets including cellular phones.
However, the EDI System used for filing the Bills of Entry was not updated (as confirmed by the information received under RTI Act, 2005) to make available the benefit of the said Notification. Accordingly, the benefit of the Notification was not extended to petitioner due to deficiency in the system, and it was rather forced to pay CVD at merit rate.
The Petitioner therefore requested the Department to amend 136 BoEs u/s 149 of the Customs Act to reassess the BoEs and grant subsequent refund, but in vain.
Section 128 provides a remedy of appeal against any order passed by the Dy. Commissioner of Customs, who is lower in rank than a Commissioner of Customs, to the Commissioner (Appeals), therefore, the petitioner has a remedy of an appeal against the assessment of the BoEs in question, said the High Court.
Similarly, section 149 is an additional remedy available to the petitioner to seek amendment of the BoEs subject to the condition that such amendment is sought on the basis of documentary evidence which was in existence at the time the goods were cleared, deposited or exported as the case may be, added the Court.
The Division Bench therefore said that the stand of the respondents in the counter affidavit that only reassessment u/s 128 is the remedy available to the petitioner, and Section 149 cannot be invoked, is not tenable.
Quoting the law declared by the Supreme Court in SRF Ltd. vs. Commissioner of Customs [Civil Appeal No.9440 of 2003 dated March 26, 2015], wherein the Apex Court granted entitlement to exemption from payment of CVD, the Bench said that such law unless made prospective in operation in its judgment, is always deemed to be the law of the land.
The Bench went on to reiterate that the Assessing Officer/Assistant Commissioner is duly responsible to correctly determine the duty leviable in accordance with law before clearing the goods for Home consumption.
The assessing officer instead, having failed in correctly determining the duty payable, has caused serious prejudice to the importer / petitioner at the first instance, added the Bench.
Accordingly, the High Court issued mandamus to the Department to amend the subject Bills of Entry to reflect the rate of tax as 1%, within four weeks to enable the petitioner to seek refund of excess duty paid u/s 27 of Customs Act, 1962.