Commissioner Of Customs Cochin-Cus vs Hindustan News Print Ltd

[Arising out of Order-in-Appeal No. 16-2009 dated 22/01/2009 passed by Commissioner of CUSTOMS(Appeals), COCHIN ]

For approval and signature:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes

Commissioner of Customs COCHIN-CUS NULL CUSTOM HOUSE COCHIN - 682009 Appellant(s)

Versus

Hindustan News Print Ltd NEWS PRINTS NAGAR, KOTTAYAM-16 KOTTAYAM - 686616 KERALA Respondent(s)

Appearance:

Shri N. Jagdish, Superintendent(AR) For the Appellant

None For the Respondent

Date of Hearing: 16/03/2015

Date of Decision: 16/03/2015

CORAM:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

Final Order No. 20744 / 2015

Per : B.S.V. MURTHY

When the matter was called, nobody is present on behalf of the respondent. The matter has been adjourned for more than 6 times in the past since the counsel for the respondent requested for time to produce evidence to show that the amount of refund had been shown as receivables in the financial records during the year 2006-07. Today when the matter was called, there is no such evidence produced nor the respondent is represented.

2. Heard the learned AR. He would submit that the respondents had not produced the Chartered Accountants certificate for the relevant year. Further he also submits that respondents themselves had submitted before the original authority that the cost of coal imported has been absorbed and included in the cost of production. Therefore he submits that the order passed by the Commissioner(Appeals) allowing the refunds is not proper and correct.

3. I have gone through the records and considered the submissions of the learned AR.

4. The respondents imported coal under 6 Bills of Entry dt. 17/04/2006 and the assessment was made provisionally since the documents furnished by the assessee were not sufficient. At the time of import and provisional assessment, SAD at 4% was also collected. Subsequently, the assessment was finalized on 20th July 2007. During the final assessment, the SAD was held as not to be payable and consequentially the importer filed a refund claim for an amount of Rs.42,45,654/-. Refund claim was rejected on the ground that assessee themselves had submitted that the cost of coal including SAD part had been absorbed in the cost of production. The assessee had also submitted a Chartered Accountants certificate but it was held that the Chartered Accountants certificate revealed that the amount was shown as receivables as on 31/12/2007 and therefore is not relevant.

5. However, the Commissioner(Appeals) on an appeal filed by the importer held that importer had discharged the burden of showing that there was no unjust enrichment. He relied on the certificate by the Cost Accountants certificate calculating the cost of production during the year 2006-07. According to the certificate, the SAD portion of the cost of coal imported had not been taken into account. Further he also relied upon the certificate issued by the Chartered Accountant to the effect that the SAD had not been passed on to any of their customers and the fact that the amount was shown as receivables in the year 2007.

6. It is quite clear that the certificate issued by the Cost Accountant is dt. 11/08/2008 whereas the OIO was passed on 11/06/2008. Therefore the certificate issued by the Cost Accountant was produced before the Commissioner(Appeals) only. Unfortunately the Commissioner(Appeals) did not notice the contradictions between the replay submitted by the importer at the time of replying to the show-cause notice proposing to reject refund claim that the cost of coal had been absorbed in the cost of production and therefore by not showing that SAD was not included, there was a contradiction between the subsequent claim before the Commissioner(Appeals) and before the original authority. Moreover what exactly was the position in 2007-08 and what are provisions of requirements of Accounting Policies (Directors Responsibility Statement pursuant to Section 217(2)AA) also has not been considered in detail. It would be appropriate if the original authority reconsiders the issue by looking into the Cost Accountants certificate as well as the contradictions between the reply to the show-cause notice and the Cost Accountants certificate if any. There is also a need to examine the effect of Directors Responsibility as mentioned in the OIO. For these purposes, the matter has to be remanded to the original authority.

7. In view of the above discussion, the impugned order is set aside and the matter is remanded to the original authority for fresh consideration of all the issues as discussed above.

(Order pronounced and dictated in open court)

B.S.V.MURTHY TECHNICAL MEMBER

Raja..

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