TIOL-DDT 2772
25 01 2016
Monday

CASES under Customs/Central Excise/Service Tax involving duty up to Rs 50 lakhs are adjudicated by the officers of the rank up to Additional Commissioner. An appeal against such orders passed, by an officer below the rank of Commissioner lies before the Commissioner (Appeals).Thus, in respect of relatively small and medium scale units, the first appellate forum is the Commissioner (Appeals). As per the existing provisions of Customs Act, 1962, Central Excise Act, 1944 and Finance Act, 1994, time limit for fling appeals before the Commissioner (Appeals) is sixty days in case of Central Excise (Sec 35) and Customs (Sec 128) and two months in case of Service Tax (Sec 85(3A)). If there is a delay in filing appeal before the stipulated time, the Commissioner (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of sixty days/two months, allow it to be presented within a further period of thirty days / one month as the case may be.

Thus, including the condonable delay, the maximum time limit for filing appeal is ninety days/ three months. What happens if the appeal could not be filed within ninety days/three months? It the end of the story for the assessee. Nothing on earth can save him. Not even the Supreme Court. In the case of Singh Enterprises, (2007-TIOL-231-SC-CX), which is widely followed in such disputes, the Supreme Court held:

The proviso to sub-section (1) of Section 35 makes the position crystal clear that the appellate authority has no power to allow the appeal to be presented beyond the period of 30 days. The language used makes the position clear that the legislature intended the appellate authority to entertain the appeal by condoning delay only upto 30 days after the expiry of 60 days which is the normal period for preferring appeal. Therefore, there is complete exclusion of Section 5 of the Limitation Act.

It will be interesting to note that in case of appeals to be filed before the CESTAT and the High Court, there is no limit for condonation of delay. Irrespective of the length of delay, the Tribunal or High Court are vested with powers to entertain the appeals if sufficient cause is shown for condonation of delay.

But, is it not an anomaly when big ticket demands, confirmed by the Commissioners enjoy unlimited condonation at the Tribunal whereas small and medium scale units' fate is sealed after three months? In fact, being hit with demands for the first time, these small units, which do not have separate personnel taking care of legal matters, take some time to find out the next course of action and to join the appeal stream. Unfortunately, many assessees are not aware of the seriousness of limitation and by the time they realise, the valuable three months' time would expire and they are stuck with the demands having no forum to fight their case on merits.

Why can't be the law amended so that the Commissioner(Appeals) are also allowed to condone the delay without any limit, as in the case of Tribunal and High Courts? As Supreme Court observed (2010-TIOL-46-SC-LMT), "After all, justice can be done only when the matter is fought on merits and in accordance with law rather than to dispose it of on such technicalities and that too at the threshold".

J&K Exemption - No more exemption for units set up after 31.03.2016

NOTIFICATIONS 56/2002 CE and 57/2002 CE provide exemption to the new Industrial Units set up / Units undertaking substantial expansion in specified areas of Jammu & Kashmir on or after 14th day of June 2002. These Notifications have been amended to stipulate that the exemption is applicable only to the units set up up to 31/03/2016. As per the amendment, exemption is applicable only to the:

1. New industrial units which have commenced their commercial production on or after the 14th day of June 2002, but not later than the 31st day of March, 2016,

2. Industrial units existing before the 14th day of June 2002, but which have, undertaken substantial expansion by way of increase in installed capacity by not less than twenty-five per cent. on or after the 14th day of June, 2002, but not later than 31st day of March, 2016

3. Units existing before 14th day of June, 2002, but made new investments on or after the 14th day of June 2002, but not later than the 31st day of March 2016, and such new investment is directly attributable to the generation of additional regular employment of not less than twenty-five per cent. over and above the base employment limit.

A new paragraph has also been inserted to restrict the scope of exemption, which reads as under:

The exemption contained in this notification shall not apply to such goods which have been subjected to only one or more of the following processes, namely, preservation during storage, cleaning operations, packing or repacking of such goods in a unit container or labeling or re-labelling of containers, sorting, declaration or alteration of retail sale price and have not been subjected to any other process or processes amounting to manufacture in the State of Jammu and Kashmir.".

Notification No. 03/2016-CE, Dated January 22, 2016

Procedure to deal with pending applications for issuance of Duty Free Import Authorisation(s) (DFIA) and their transferability - DGFT Notifies procedure

DIRECTOR General of Foreign Trade, in exercise of powers conferred under paragraph 1.03 of the Foreign Trade Policy, 2015-2020, notified procedure to be followed for issuance of DFIA and their transferability in respect of pending applications. As per this Notification,

Cases where Authorisation ( DFIA ) could not be issued up to 1.04.2015:

a. Cases where DFIA applications were filed on line to Regional Authorities (RAs) before 1.04.2015 by exporters but no exports have been made by exporter before 1.04.2015 - In such situations, application will be treated as valid application and RA may issue DFIA based on Post Export basis only as per FTP 2015-20 and HBP 2015-20.

b. Cases where DFIA applications were filed on line to Regional Authorities (RAs) before 1.04.2015 by exporters and exports have been made partially/fully up to 31.03.2015- In such situation, RA may issue DFIA based on Post Export basis only as per FTP 2015- 20 and HBP 2015-20 as per admissibility.

c. Cases where DFIA applications were filed on line to Regional Authorities (RAs) before 1.05.2015 by exporters and exports have been made partially/fully up to 30.04.2015 and exporter has used "raw sugar" as input as per SION - In such situations, DFIA will be allowed as per FTP 2015-20 to the extent of the entitlement of "raw sugar" on the export consignments for which Let Export Orders (LEOs) have been issued till 2400 hrs on Thursday 30.4.2015. Any shipments having LEO on or after 1.05.2015, where raw sugar has been used as an input will not be eligible for grant of DFIA. Exporter will have option to avail facility to get his Shipping Bills converted to Drawback Scheme as per para 4.29 of HBP 2015-20

Cases where DFIA (not involving import of raw sugar as an input) was issued as per provisions of FTP 2009-14 but request for transferability could not be considered up to 30.03.2015.

In such cases Transferability request may be considered by RA as per the terms and conditions of DFIA issued during FTP 2009-14, provided all documents are in order.

Cases involving import of raw sugar where request for transferability could not be considered.

a. Request for transferability in respect of DFIA which were already issued in earlier FTP 2009-14 and involve raw sugar as an input - Requests of transferability in such cases of DFIAs may be considered by RA, as per FTP 2009-14, by allowing entitlement of raw sugar for export consignments for which Let Export Orders (LEOs) have been issued till 2400 hrs on Thursday 30.4.2015. Any exports with LEO on or after 1.05.2015 will not be eligible for DFIA benefit in view of Notification No. 5/2015-20.Exporter will have option to avail facility to get his Shipping Bills converted to Drawback Scheme as per para 4.29 of HBP 2015-20.

b. Requests for transferable DFIA as per FTP 2015-20 on the exports made from 1.04.2015 till 30.04.2015 where raw sugar in an input - RA may grant transferable DFIA as per FTP 2015-20 by allowing entitlement of raw sugar for export consignments made from 1.04.2015 up to 30.04.205 for which Let Export Orders (LEOs) have been issued till 2400 hrs on Thursday 30.4.2015. Any exports with LEO on or after 1.05.2015 will not be eligible for grant of DFIA benefit in view of Notification No. 5/2015-20.Exporter will have option to avail facility to get his Shipping Bills converted to Drawback Scheme as per para 4.29 of HBP 2015-20.

DGFT Public Notice No 56/2015-2020, Dated: January 22, 2016

Presidential Awards Announced

ON the occasion of Republic day, 2016, the CBEC has notifies the list of officers selected for awarding Appreciation Certificate for "Specially distinguished record of service". The list includes officers from all cadres ranging from Private Secretary to Principal Commissioners.

Notification No. 15/2016 - Customs (N.T.), Dated: January 22, 2016

Consistency is cornerstone of administration of justice

IN a judgement delivered on Friday, the Supreme Court reproduced a passage from an earlier judgement of the Court:

"Consistency is the cornerstone of the administration of justice. It is consistency which creates confidence in the system and this consistency can never be achieved without respect to the rule of finality. It is with a view to achieve consistency in judicial pronouncements, the Courts have evolved the rule of precedents, principle of stare decisis etc. These rules and principle are based on public policy..."

Interestingly, in this judgement, the Supreme Court also held that when a main order is not challenged and only the review order is challenged, the Court is obliged not to entertain such special leave petition.  

Please See Breaking News for more on this judgement.

Happy Republic Day

Until Wednesday with more DDT

Have a nice day.

Mail your comments to vijaywrite@tiol.in