Madras High Court
The Assistant Commissioner Of Customs vs M/S.Modern India Products on 21 February, 2025
Author: G.R.Swaminathan
Bench: G.R.Swaminathan
W.A.(MD)No.1559 of 2021
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 21.02.2025
CORAM
THE HONOURABLE MR.JUSTICE G.R.SWAMINATHAN
AND
THE HONOURABLE MR.JUSTICE M.JOTHIRAMAN
W.A(MD)No.1559 of 2021
and
C.M.P(MD)No.6439 of 2021
1.The Assistant Commissioner of Customs,
Customs House,
IGST Section,
New Harbour Estate,
Tuticorin – 628 004.
2.Union of India,
Ministry of Finance,
Parliament Street,
Central Secretariat,
North Block,
New Delhi – 110 001. ... Appellants /
Respondents 1 & 2
Vs.
M/s.Modern India Products,
Represented by its Managing Partner,
S.Uma Maheswaran,
314, Thiruvalluvar Street,
Rajapalayam,
Tamil Nadu – 626 117. ... Respondent /
Petitioner
Prayer: Writ Appeal filed under Clause 15 of Letters Patent Act to set
aside the order dated 17.04.2021 made in W.P(MD)No.9796 of 2020.
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1/5
W.A.(MD)No.1559 of 2021
For Appellants : Mr.R.Nandakumar
For Respondent : Mr.N.Sudalai Muthu
JUDGMENT
Heard both sides.
2.The writ petitioner is an exporter of goods known as “absorbent
gauze roll”. The export was made on 26.09.2017. The goods were
valued at Rs.12,72,827/- and the writ petitioner paid a sum of
Rs.2,54,449/- towards Integrated Goods and Service Tax (IGST). The
case of the writ petitioner is that the exports would come under what is
known as zero rated supply and they are entitled to refund of the said
IGST amount in terms of Sections 16 and 54 of the IGST Act read with
Rule 96 of CGST Rules. When the petitioner applied for refund, it was
not acted upon. Hence the petitioner filed W.P(MD)No.9796 of 2020.
The writ petition was allowed by the learned single Judge on 17.04.2021.
Questioning the same, this intra-Court appeal has been filed.
3.The learned Standing Counsel relied on Circular No.37 / 2018 -
Customs dated 09.10.2018 which states that if duty drawback is claimed,
refund of IGST amount cannot be sought. Paragraph Nos.2.4, 2.5 and 3
of the said circular read as follows:
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“2.4 The declarations required in terms of above
Notes and Conditions and provisions of the Drawback
Rules are made electronically in the ED! System. When
composite drawback rate was claimed (by declaring
suffix A or C with Drawback serial number), exporter was
required to tick DBK002 and DBK003 declarations in the
shipping bills. In fact, for period 1.7.2017 to 26.7.2017, a
manual declaration was also required to be given as the
changes made on 26.7.2017 were made applicable for
exports made from 1.7.2017 onwards.
2.5 By declaring drawback serial number suffixed
with A or C and by making above stated declarations, the
exporters consciously relinquished their IGSTIITC
claims.
3. It has been noted that exporters had availed the
option to take drawback at higher rate in place of IGST
refund out of their own volition. Considering the fact that
exporters have made aforesaid declaration while
claiming the higher rate of drawback, it has been decided
that it would not be justified allowing exporters to avail
lOST refund after initially claiming the benefit of higher
drawback. There is no justification for re-opening the
issue at this stage.”
The Hon'ble Division Bench of Gujarat High Court in the decision
reported in 2019 (7) TMI 472 (M/s.Amit Cotton Industries Through
Partner, Veljibhai Virjibhai Ranipa Vs Principal Commissioner of
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Customs) had categorically held that the aforesaid circular cannot prevail
over Rule 96. The Hon'ble Division Bench observed that the circular
will not save the situation for the Department. This decision was
followed by the Madras High Court in the decision reported in 2020 (1)
TMI 90 (M/s.Precot Meridian Limited Vs The Commissioner of
Customs, The Assistant Commissioner of Customs). We are also
informed that several other High Courts have also taken the very same
view. Since the learned single Judge granted relief to the writ petitioner
only by following the existing legal position, interference with the said
order is not warranted.
4.This Writ Appeal stands dismissed. No costs. Consequently,
connected miscellaneous petition is closed.
[G.R.S., J.] [M.J.R., J.]
21.02.2025
NCC : Yes / No
Index : Yes / No
Internet : Yes/ No
MGA
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G.R.SWAMINATHAN,J.
AND
M.JOTHIRAMAN, J.
MGA
21.02.2025
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