Perfect Importers And ... vs Union Of India
2022 Latest Caselaw 10194 Guj

    C/SCA/22502/2019                               CAV JUDGMENT DATED: 16/12/2022




               IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                R/SPECIAL CIVIL APPLICATION NO. 22502 of 2019


FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE N.V.ANJARIA

and
HONOURABLE MR. JUSTICE BHARGAV D. KARIA

==========================================================

1 Whether Reporters of Local Papers may be allowed to see the judgment ?

2 To be referred to the Reporter or not ?

3 Whether their Lordships wish to see the fair copy of the judgment ?

4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ?

========================================================== PERFECT IMPORTERS AND DISTRIBUTORS (INDIA) PVT. LTD.

Versus UNION OF INDIA ========================================================== Appearance:

MR HASIT DAVE(1321) for the Petitioner(s) No. 1,2 MR NIKUNT K RAVAL(5558) for the Respondent(s) No. 1,2 ==========================================================

CORAM:HONOURABLE MR. JUSTICE N.V.ANJARIA and HONOURABLE MR. JUSTICE BHARGAV D. KARIA

Date : 16/12/2022

CAV JUDGMENT

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)

1.Heard learned advocate Mr. Hasit Dave for the

petitioners and learned advocate Mr. Nikunt

Raval for the respondents.

2.By this petition under Article 226 of the

Constitution of India, the petitioners have

prayed for a direction to respondent no.2 -

Assistant Commissioner of Customs, ICD

Dashrath, Vadodara to refund the amount of

Rs.23,62,796.00 with interest from the date

of levy till final payment at the rate of 15%

per annum.

3.Brief facts of the case are that the

petitioners are engaged in trading of

imported goods such as Cast Alloy Aluminum

Wheels or Alloy Road Wheels used for Motor

Vehicles.

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

3.1) The petitioners filed three Bills of

Entry Nos. (1) 8195940 dated 4.2.2015, (2)

9212058 dated 12.5.2015 and (3) 9308623 dated

21.5.2015 for clearance of their imported

goods.

3.2) On the above imported goods, a

Provisional Anti Dumping Duty at specified

rate was imposed under the Provisional Anti

Dumping Duty Notification No.15/2014 dated

11.4.2014 which was valid for a period of six

months as per the provisions of the law and

as such, validity of the said notification

expired on 11.10.2014.

3.3) Another Notification No.21/2015

dated 22.5.2015 was issued imposing Anti

Dumping Duty at the same rate as specified

in the Provisional Anti Dumping Duty

Notification for a period of five years.

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

3.4) According to the petitioners, there

was no Anti Dumping Duty leviable between the

expiry of first Provisional Anti Dumping Duty

Notification No.15/2014 dated 11.4.2014 and

Notification No.21/2015 dated 22.5.2015.

However, the petitioners were directed by the

respondent authorities to pay Anti Dumping

Duty of Rs.23,62,796.00 as per Notification

No.21/2015 dated 22.5.2015 on the imported

goods and accordingly, the petitioner paid

such Anti Dumping Duty so as to take

delivery of the goods.

3.5) The petitioners by letter dated

15.10.2015 requested the respondent

authorities to refund the aforesaid amount as

per the decision of the Apex Court in case of

CIT, Bangalore v. G.M. Exports reported in

2015 (324) E.L.T. 209 (SC), wherein the Apex

Court observed that if there is a gap between

the Provisional Anti Dumping Duty

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

Notification and the regular final Anti

Dumping Duty Notification in the intervening

period, no Anti Dumping Duty is payable.

3.6) The respondent authorities by letter

dated 17.12.2015 informed the petitioners

that refund cannot be allowed as the Anti

Dumping Duty was levied as per the provisions

of Notification No.21/2015 dated 22.5.2015

with effect from 11.4.2014 and therefore,

when the goods were imported by the

petitioners, the Anti Dumping Duty was

leviable as per the Notification No.21/2015.

3.7) The petitioners thereafter

reiterated the request to refund the Anti

Dumping Duty paid by the petitioners vide

letter dated 25.12.2015 again relying upon

the decision of the Apex Court in case of

G.M. Exports (supra).

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

3.8) The petitioners received the show

cause notice dated 10.2.2016 from the

respondents calling upon to show cause as to

why refund claim of Rs.23,62,796.00 should

not be rejected under section 27 of the

Customs Act, 1962 read with Notification

No.21/2015 dated 22.5.2015.

3.9) The petitioners filed the written

submissions dated 15.7.2016 reiterating that

the petitioners are entitled to refund as per

the decision of the Apex Court in case of

G.M. Exports (supra).

3.10) However, the respondent authorities

passed the order-in-original dated 30.08.2016

rejecting the refund claim of the

petitioners.

3.11) The petitioners feeling aggrieved by

the order dated 30.08.2016 preferred an

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appeal before the Commissioner (Appeals),

Customs, Ahmedabad who by order dated

1.05.2017 remanded the proceedings to the

original adjudicating authority to pass a

reasoned order after following the principles

of natural justice and considering the

decision of the Apex Court in case of G.M.

Exports (supra).

3.12) The Assistant Commissioner again by

order dated 15.03.2018 rejected the refund

claim of the petitioners in the remand

proceedings on the ground that the claim of

the petitioners is not maintainable as the

petitioners did not challenge the assessment

order under three Bills of Entry and in

absence of challenge to the assessment orders

by which Anti Dumping Duty was levied as per

the decision in case of M/s. Priya Blue

Industries Ltd. reported in 2004 (172) ELT

145 (SC), refund cannot be granted.

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3.13) The petitioners again challenged the

order-in-original dated 15.03.2018 before the

Commissioner (Appeals) who by order dated

22.01.2019 allowed the appeal and remitted

the matter back to the adjudicating authority

holding that issue of wrong levy of

Provisional Anti Dumping Duty is covered by

the decision of Apex Court in case of G.M.

Exports (supra) and the decision in case of

M/s. Priya Blue Industries Ltd.(supra) is

distinguishable in view of further decision

of the Delhi High Court in case of Aman

Medical Products v. Commissioner reported in

2010 (250) ELT 30 (Del) and decision of

Madras High Court in case of Enterprise

International Ltd. v. Commissioner of

Customs, Chennai reported in 2013 (295) ELT

659(Mad). The Commissioner (Appeals)

therefore, directed the adjudicating

authority to follow the principles of natural

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justice and grant an opportunity of hearing

to the petitioners before passing an order as

per the observations made in the order.

3.14) It is the case of the petitioners

that even after a passage of six months from

the date of issuance of above directions by

the Commissioner (Appeals), the adjudicating

authority i.e. respondent no.2 - Assistant

Commissioner of Customs did not undertake the

remand proceedings though the claim of refund

made by the petitioners is covered in favour

of the petitioners.

3.15) The petitioners therefore, sent a

reminder letter dated 30.07.2019 to

respondent no.2 to take a decision for

granting refund as per the decision of the

Apex Court in case of G.M. Exports (supra).

As the respondent no.2 has not taken any

action after the remand of the matter by the

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appellate authority vide order dated

22.01.2019, the petitioners have preferred

this petition with a prayer to direct

respondent no.2 to refund the amount claimed

by the petitioners.

4.Learned advocate Mr. Hasit Dave for the

petitioners submitted that the appellate

authority in order dated 22.01.2019 has given

directions to the respondent no.2

adjudicating authority to grant an

opportunity of hearing to the petitioners and

examine the available facts, documents,

submissions and all relevant case laws and

then pass proper legal speaking order afresh

adhering to the legal provisions. It was

submitted that inspite of such clear

directions and observations made by the

appellate authority, respondent no.2 has not

passed any order since then.

 C/SCA/22502/2019                                     CAV JUDGMENT DATED: 16/12/2022




      4.1)            It         was       submitted             that             the

petitioners have time and again requested the

respondent authorities to pass a fresh order

on the second remand made by the appellate

authority, however, respondent no.2 instead

of passing the order has tried to justify in

the affidavit in reply filed in this

proceeding that unless and until the

assessment order is modified in appeal or in

review, the duty would be payable as per self

assessment or assessment order passed by the

proper officer and as the petitioners did not

challenge the assessment of the Bills of

Entry for which the petitioners are seeking

refund claim, such claim is liable for

rejection on the said ground alone.

4.2) It was submitted that on the same

reasoning, the order-in-original dated

15.03.2018 was challenged before the

Commissioner (Appeals) after the first remand

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

made in the original proceedings.

4.3) It was submitted that instead of

passing the order-in-original upon remand

made by the appellate authority, respondent

no.2 has tried to justify the order which was

already passed on 15.03.2018 which is now

quashed and set aside by the appellate

authority.

4.4) It was therefore, submitted that the

respondent no.2 is required to grant the

refund in view of the observations made by

the appellate authority but instead thereof,

respondent no.2 has filed an affidavit in

reply justifying the stand of the

adjudicating authority which was already

taken in the year 2018 but such view is

rejected by the appellate authority in the

order dated 22.01.2019 and therefore,

respondent no.2 is required to pass the order

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of refund as per the directions of the

appellate authority. It was submitted that

respondent no.2 cannot ignore the directions

of the appellate authority and continue to

sit tight over the matter by not passing the

order to grant refund of the claim of the

petitioners.

4.5) It was further submitted that when

the respondent authority has not passed any

order of refund of claim of the tax collected

without any authority of law, the writ

petition is maintainable under Article 226 of

the Constitution of India. It was also

submitted that the refund is required to be

granted to the petitioners along with

interest and therefore, the petitioners are

entitled to interest on the refund amount of

Anti Dumping Duty which is paid in the year

2015 though the petitioners were not liable

to pay the same as per the settled legal

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

position as held by the Apex Court in case of

G.M. Exports (supra).

4.6) In support of his submissions,

learned advocate Mr. Dave relied upon the

following decisions :

1) In case of Salonah Tea Company Ltd. Etc.

v. Superintended of Taxes, Nowgong & Ors.

Etc. reported in 1988(33) ELT 249 (SC).

2) In case of HMM Ltd. v. Administrator,

Bangalore City Corporation reported in 1997

(91) ELT 27 (SC).

3) In case of New Kamal v. Union of India

reported in 2020(372) ELT 571 (Guj).

4) In case of S.R. Polyvinyl Ltd. v.

Commissioner of Cus. ICD, TKD, New Delhi

reported in 2020(371) ELT 283.

 C/SCA/22502/2019                                  CAV JUDGMENT DATED: 16/12/2022




      5)      In      case     of       Sandvik        Asia          Ltd          v.

Commissioner of Income tax-I, Pune reported

in 2006 (196) ELT 257 (SC).

5.On the other hand, learned advocate Mr.

Nikunt Raval for the respondents submitted

that the petitioners are not entitled to any

relief contrary to the policy decision of the

Central Government to pay the required duties

as per the norms prescribed from time to

time.

5.1) It was submitted that the appellate

authority while remanding the case back to

the original adjudicating authority for de

novo proceedings, has held that the

applicability of the ratio of the Apex Court

in case of M/s. Priya Blue Industries Ltd.

(supra) is required to be re-examined in

light of the said case law. It was however

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

pointed out that in refund case of the

petitioner, the show cause notice was

transferred to Call Book on the ground that

judgment of High Court in case of M/s.

Micromax Informatic Ltd. v. Union of India

was challenged before the Supreme Court by

the department in SLP(C) No.18145/2016. It

was submitted that the Apex Court by order

dated 28.09.2019 passed in Civil Appeal

No.2960/2010 has held that claim of refund

cannot be entertained unless the order of

assessment or self assessment is modified in

accordance with law by taking recourse to the

appropriate proceedings. It was therefore,

submitted that in view of judgment of the

Apex Court, refund claim is liable for

rejection.

5.2) Learned advocate Mr. Raval

thereafter relied upon the averments made in

the affidavit in reply on filed on behalf of

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respondent nos. 1 and 2 wherein in paragraph

nos. 10 to 15, the respondents have tried to

justify that the petitioners are not entitled

to refund of the Anti Dumping Duty paid by

the petitioners on merits. It was therefore,

submitted that when the petitioners are not

entitled to refund of the amount of the Anti

Dumping Duty paid by the petitioners, the

petition is not liable to be entertained.

6.Considering the above submissions, it appears

that the petitioners paid the Anti Dumping

Duty as per the directions of the respondent

authorities to clear the goods imported on

21.05.2015. Admittedly on that date,

Notification No.15/2014 dated 11.4.2014

levying Anti Dumping Duty for a period of six

months was not applicable. The contention

raised on behalf of the respondents that

Notification No.21/2015 dated 22.5.2015 is

issued with effect from 11.04.2014 is not

C/SCA/22502/2019 CAV JUDGMENT DATED: 16/12/2022

tenable in law in view of decision of the

Apex Court in case of G.M. Exports (supra),

wherein the Apex Court decided the question

of law as to whether Anti Dumping Duty

imposed with respect to imports made during

the period between the expiry of the

provisional Anti Dumping Duty and the

imposition of the final Anti Dumping Duty is

legal and valid or not and while deciding

such a question of law, after considering the

provisions in detail, the Apex Court held as

under :

"46. We also find force in the submission of learned counsel for the assessees that the revenue's construction of Rule 20 would achieve indirectly what cannot be achieved directly, having regard to the mandatory language contained in Rule 13 second proviso. Here again a simple example would suffice. Say the provisional duty is levied at the rate of Rs. 50/- PMT and comes to an end after 6 months. 6 months later, a final duty is imposed again at the same rate of Rs. 50/- PMT with effect from the date of levy of the provisional duty. If learned counsel for the revenue were right, Rs. 50/- PMT could be recovered under Rule 20(2)(a) for the interregnum period as well which would, in effect,

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destroy the scheme of Rule 13 second proviso by extending the period of the provisional duty notification beyond a period of 6 months, which clearly cannot be done. We find therefore that on all these counts, the arguments of revenue cannot be countenanced."

7.After considering the aforesaid decision in

case of G.M. Exports (supra) in order dated

22.01.2019, Commissioner of Customs (Appeals)

held as under :

"05. I have carefully gone through the impugned order, the appeal submissions, and other records of the case. The impugned order has been issued in pursuance of Order-in-appeal No.AHD- CUSTM-000-APP-007-17-18 dated 01.05.2017 remanding the case back to the original adjudicating authority as no finding was given by the adjudicating authority as to whether the said anti-dumping (ADD) duty was leviable or not during the interregnum period from the expiry of the provisional levy of ADD to the issue of final order of ADD, in the light of the decision of Hon'ble Supreme Court in the case of Commissioner of Customs vs G.M. Exports - 2015 (324) E.L.T 209 (SC). However, even in the second round of adjudication, the refund claim has not been decided on the basis of Commissioner of Customs vs G.M.

Exports- 2015 (324) E.LT 209 (SC) but the same has been decided applying the ratio of the judgment of Hon'ble Supreme Court in the case of M/s Priya Blue Industries Ltd.- 2004 (172) ELT

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145 SC, whereby the refund claim has been rejected on the ground that the original assessment order has not been challenged in the present case.

06. The present case has not been examined in the light of law settled by Hon'ble Supreme Court in the case of Commissioner of Customs vs G.M. Exports-2015 (324) E.L.T 209 (SC). As regards the applicability of the ratio of another Supreme Court decision in the case of M/s Priya Blue Industries Ltd. -2004 (172) ELT 145 SC relied upon in the impugned order, the same has been challenged by the appellant by relying on the case law in the matter of Aman Medical Products v.

Commissioner- 2010 (250) E.L.T. 30 (Del.) to contend that M/s Priya Blue Industries Ltd. - 2004 (172) ELT 145 SC is not applicable to the present case. Further, I find that in the case of Enterprise International Ltd. vs. Commissioner of Customs, Chennai-2013 (295) E.L.T. 659 (Mad), Hon'ble High Court has laid down that the facts of the case before the Supreme Court in Priya Blue Industries case stand entirely on a different footing as compared to matters of finalization of provisional anti-dumping duty in terms of Section 9A(2)(b) of the Customs Tariff Act, 1975. In the instant case also the matter pertains to refund arising out of finalization of provisional anti-dumping duty. However, in the impugned order, the above case laws were not considered or discussed while applying the ratio of the Apex Court decision in the case of M/s Priya Blue Industries Ltd. - 2004 (172) ELT 145 SC. Therefore, the applicability of the ratio of the Apex court decision in

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M/s Priya Blue Industries Ltd. - 2004 (172) ELT 145 SC is required to be reexamined in the light of the said case laws. Further to this, specific findings are required to be given with regards to the applicability of the Apex Court decision in the matter of Commissioner of Customs vs G.M. Exports-2015 (324) E.L.T 209 (SC) to the facts of the impugned refund claim. In view of these facts, the impugned order is liable to be remanded to the adjudicating authority for de novo proceedings. In this regard, I rely upon the case of Prem Steels P Ltd- 2012-TIOL-1317-CESTAT-DEL and the case of Hawkins Cookers Ltd. - 2012 (284) ELT 677(Tri-Del), which have also relied upon case of Medico Labs- 2004(173) ELT 117 (Guj.), wherein it has been held that Commissioner (Appeals) continue to have power of remand even after the amendment of Section 35(A) of the Central Excise Act, 1944 by Finance Act, 2001 w.e.f 11.5.2001.

7. Accordingly, I remit the refund claim back to the adjudicating authority, who shall examine available facts, documents, submissions and all relevant case laws then pass proper legal speaking order afresh after following principles of natural justice and adhering to the legal provisions. While passing this order, no opinion/ views have been expressed on the merits of the dispute, which shall be independently considered by the assessing authority."

8.In view of the above findings of the

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appellate authority, the stand taken by

respondent nos.1 and 2 in the affidavit in

reply for not passing the order granting or

refusing the refund and sitting tight over

the matter on the ground that the petitioners

are not entitled to refund and justifying the

same by filing affidavit in reply is nothing

but an attempt to evade the directions issued

by the appellate authority which is otherwise

binding upon the adjudicating authority. The

adjudicating authority cannot ignore the

order of the higher authority and sit tight

on the matter by not deciding the same.

9.Law on the subject is no more res integra as

this Court as well as the Apex Court has time

and again held that the directions given by

the higher authority is binding upon the

lower authority and therefore, such

directions cannot be ignored on any count.

Respondent no.2 was bound to pass the order-

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in-original upon remand made by the appellate

authority vide order dated 22.01.2019. The

attempt on part of the respondent no.2 to

justify that the petitioners are not entitled

to refund in the affidavit in reply cannot be

sustained.

10. The respondent no.2 in the affidavit in

reply has disclosed the grounds for not

granting refund to the petitioners justifying

the stand of the respondents for not passing

the order in original after remand and has

reiterated that the order dated 15.03.2018

rejecting the refund claim was just and

proper though the same order is quashed and

set aside by appellate authority by order

dated 22.01.2019. Such attitude and action of

the respondent no.2 authority is required to

be deprecated as the same is contrary to the

judicial propriety.

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11. The Apex Court in case of Salonah Tea

Company Ltd. Etc.(supra) has held that under

Article 226 of the Constitution of India, the

High Court has power to direct the refund

unless there has been avoidable laches on the

part of the petitioners in a case where tax

or money has been realised without the

authority of law.

12. Similarly, in case of HMM Ltd. v.

Administrator, Bangalore City

Corporation(supra), the Apex Court held that

when there is no question of "unjust

enrichment", the petitioner is entitled to

refund even if the question with regard to

grant of refund was pending before the

Constitution Bench of the Supreme Court. The

issue before the Apex Court was pertaining to

refund under section 98(2) of City of

Bangalore Municipal Corporation Act, 1949

read with Rule 57A of the Central Excise

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Rules, 1944 with regard to levy of octroi in

respect of goods which are not used, consumed

or sold within the municipal limits so as to

become collection without any authority of

law. It was held that the respondent

authority had no authority to retain the

amount which is refundable as there was no

dispute on plea of unjust enrichment of the

petitioner.

13. We are therefore of the opinion that as

the respondent authority has not carried out

the directions issued by the appellate

authority and has tried to justify the order

which is set aside by filing the affidavit in

reply on merits in this proceeding, it would

be a futile exercise to direct the respondent

n.2 for passing the order as per the

directions of the appellate authority.

14. The respondent no.2 is therefore

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required to be directed to issue refund to

the petitioners in view of the decision of

the Apex Court in case of G.M.

Exports(supra). In the facts of the case the

ratio of the decision of Priya Blues(supra)

would not be applicable as admittedly the

levy of anti duty dumping duty was not in

force when the petitioners imported the goods

Hence, the assessment orders which are in

form of bill of entries filed by the

petitioners are not required to be modified

or reassessed as the same are filed without

inclusion of levy of anti dumping duty. The

petitioners were compelled to pay such duty

only after filling bill of entries so as to

release the goods.

15. In view of the foregoing reasons, the

petition succeeds and is accordingly allowed.

The respondent authorities are directed to

refund amount of Rs.23,62,796.00 with

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interest at the rate of 6% per annum from the

date of levy till final payment within eight

weeks from the date of receipt of copy of

this order.

16. Rule is made absolute to the aforesaid

extent. No order as to costs.

(N.V.ANJARIA, J)

(BHARGAV D. KARIA, J) RAGHUNATH R NAIR