IEC Alert Active when OIO Passed: CESTAT Orders Reconsideration of Double Customs Duty Refund Claim [Read Order]

The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ), Mumbai, with regards to the matter of customs duty paid twice on the same container, ordered reconsideration of the refund claim.

The appellant, Prima Chemicals challenged the order passed by the Commissioner of Customs (Appeals) before the appellant tribunal.

According to the appellant, the order rejected the appellant’s appeal on the ground that necessary documents were not submitted before the adjudicating authority for processing the refund claim.

As per the submission of the Prima Chemicals, the issue about the refund of ₹4,37,321 belongs to Bill of Entry No. 5988418 dated 07.12.2019 filed at JNCH, Nhava Sheva.

However, the container covered under the said Bill of Entry was off-loaded at ICD Ahmedabad and cleared against Bill of Entry No. 6158566 dated 21.12.2019, resulting in the appellant allegedly paying customs duty twice for the same container.

Later, the appellant filed a refund application for refund of the duty paid at JNCH. The department issued a deficiency memo calling for certain documents.

In response, the appellant informed the department via email that the documents had been submitted for obtaining a No Objection Certificate (NOC) from the DEEC Monetary Cell as an active alert was pending against the appellant’s IEC. This prevents completion of the refund process.

Due to non-submission of the documents, the refund claim was rejected by the adjudicating authority.

The appellate tribunal noted that the IEC alert was removed only after the passing of the Order-in-Original, and therefore the adjudicating authority had no option to examine the removal communication while deciding the refund claim.

Therefore, the bench of Ajay Sharma, Member (Judicial) held that “in the interest of justice and without delving into the merits of the refund claim, it is appropriate to remand the matter for fresh adjudication.”

Accordingly, the bench set aside the impugned order and remanded the matter back to the adjudicating authority for reconsideration of the refund application.

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