Customs Duty could not be collected from New Purchaser as Duty on the Goods already stood discharged: CESTAT [Read Order]

The Chennai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that Customs Duty duty could not be collected from New purchasers as the duty on the goods already stood discharged.

The appellant, M/s. Chloride Metals Limited imported Lead Ingots and Refined Lead Ingots for the manufacture of pure lead and lead alloys. They entered into a contract with M/s. KYEN Resources Pte. Ltd. Singapore for import of refined lead ingots. Based on the documents received, it was observed that M/s. Navam Lanka Ltd. was the manufacturer and shipper of the goods. The appellant filed bills of entry dated 5.9.2018 and 11.9.2018 and claimed exemption from payment of BCD vide Notification No. 26/2000 dated 1.3.2000 under FTA. The said bills of entry were assessed to duty and facilitated under RMS. The appellant paid the IGST of Rs.61,24,785/- on 5.9.2018 and 11.9.2018. The appellant was not able to get the original documents for taking delivery of the impugned goods. It was understood by the appellant that the supplier in Singapore had become bankrupt and was not in a position to provide the original documents. There were huge demurrage and detention charges on the goods imported. The appellant filed an application for a refund of the IGST paid on the imported goods as he did not intend to take the release of goods. Meanwhile, M/s. Navam approached the appellant to grant NOC (No Objection Certificate) to enable Navam to take charge of the goods and mitigate the losses.

In response to the request made by Navam, the appellant requested them to remit the IGST paid and other expenses incurred by the appellant. On receipt of the payment, the appellant would issue the NOC, and that on receipt of the refund claim of IGST from the department, the appellant undertook to pay back the amount to Navam. Under these circumstances, Navam approached their sister concern M/s. Gravita India Ltd., Andhra Pradesh for clearing the goods in their name with the NOC given by the appellant. In terms of Public Notice No. 47/2016 dated 15.3.2016 issued by the JNCH, if the

NOC is produced, the name of the importer in the bills of entry can be amended for clearing the goods. Pursuant to the issue of NOC, the appellant was under the impression that M/s. Gravita India Ltd. would get the IGM amended and would file fresh bills of entry in their name for clearing the goods. However, M/s. Gravita India Ltd. informed that since the cancellation of the bills of entry was not possible in the ICEGATE system, they amended the name of the importer in the bills of entry.

The coram of Judicial Member, Sulekha Beevi C.S. ruled that there is nothing brought out in evidence that attracts the ingredients of section 114AA of the Customs Act, 1962. The mere fact that the department had already appropriated the duty amount paid by the appellant towards the imported goods and therefore could not collect further amount against the amended bills of entry presented by the new purchaser cannot be a ground to issue a Show Cause Notice alleging attempt to claim an undue refund.

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Chloride Metals Ltd. vs Commissioner of Customs , 2021 TAXSCAN (CESTAT) 132 , Shri R. Srinivasan , Shri S. Balakumar