By TIOL News Service

KOLKATA, JUNE 27, 2014 : A SCN was issued to the appellant proposing a change in classification of ‘dairy machine Ice cream candy' & demanding differential duty.

The Deputy Commissioner of Customs, Appraising Group, 5A, Customs House, Kolkata dropped the proceedings.

Being aggrieved, Revenue filed an appeal before the Commissioner(Appeals) but the same was rejected on the ground of time bar.

Before the Tribunal, it is submission of the Revenue that the lower appellate authority should have taken a more liberal view and after condoning the delay should have gone into the merits of the case. Inasmuch as even though the Commissioner/Committee of Commissioners initially accepted the order of the Deputy Commissioner, but a decision was taken to file the Appeal consequent to receipt of audit objection and all this coupled with the “immense work pressure” had led to the delay in filing the appeal on time. Many case laws were cited in support of condoning the delay. The Larger Bench Tribunal decision in Monnet Ispat& Energy Ltd. 2010-TIOL-1133-CESTAT-DEL-LB is also adverted to.

The respondent submitted that the period of limitation provided under Section 129A(3) of the Customs Act, 1962, for review of the order cannot be enlarged in view of the decision of the Calcutta High Court in the case of Al Saif Internationaland the decision in Kap Cones - 2012-TIOL-1301-CESTAT-DEL where a view contrary to the LB decision has been taken. It is also submitted that even if it is held that the Tribunal has the power to condone the delay, in the absence of sufficient cause, the delay cannot be condoned in view of the apex court decision in Thakkar Shipping Pvt.Ltd. 2012-TIOL-105-SC-CUS. It is alsoemphasized that i n this case the order of the lower authority was accepted by the review committee and a decision was taken not to file an Appeal before CESTAT and once the review was done, it cannot be reopened or revised as held by the Tribunal in the case of Madura Coats Pvt.Ltd. 2007-TIOL-2324-CESTAT-MAD.

The Bench noted that the order of the Dy. Commissioner was initially accepted by the department however, based on the Internal audit objection, a decision was taken to review the said order. It wasfurther observed that whereas in terms of s. 129D(2) of the Customs Act, 1962 the Commissioner of Customs was empowered to review the order passed by the Deputy Commissioner, in the present case the Committee of Commissioners had examined the order and after holding it to be legal and proper accepted the same. The Bench, thereafter, viewed that that once the legality and propriety of the order passed by the lower authorities has been examined and the same is found to be legal and proper, no subsequent review order could be passed under the said Section 129D(2).

After adverting to the Tribunal decisions cited by the Respondent, the CESTAT held thus -

++ We find that in the present case the Review Committee has initially accepted the order of the Dy. Commissioner and the subsequent decision to review the order was only at the instance of Audit and the order is not free from bias. There is no provision under Section 129 (A) and 129 (D) of the Customs Act, 1962 to reopen or review the Review Committee's order. Thus the Committee has become functus officio .

++ In view of the above ratio laid down in case of Madura Coats (supra) and followed by the Tribunal in case of Sagar Sugar and Allied Products Ltd. (Supra), we are of the opinion that once the Order of the lower authority has been accepted by the Commissioner and found to be legal and proper, the same cannot be reviewed later.

In fine, the Revenue appeal was dismissed.

Delay in passing : Will this be the end of the road for the Revenue?

(See 2014-TIOL-1134-CESTAT-KOL)