ST - To reject claims, not on merit but by resort to bar of limitation, at end of protracted process reflects lack of accountability - it is a settled law that limitation should be computed with effect from date of original, albeit incomplete, filing of refund claim: CESTAT
By TIOL News Service
MUMBAI, APR 07, 2016: THE appellant is in the business of producing single colour/multi-colour printed books that are exported and consumes a number of services.
They claimed refund in terms of notification no. 41/2007-ST. One of the conditions is that refund in relation to exports of each quarter is to be preferred in a single claim.
The deadline of sixty days from the end of the quarter prescribed for filing of refund claims was extended to six months vide notification no. 32/2008-ST dated 18th November 2008. Thereafter vide notification no. 17/2009-ST dated 7th July 2009 the deadline was further extended to one year from the end of the relevant quarter.
Refund claim of Rs.9,46,278 for the quarter ending September 2008 was filed on 31st March 2009 and refund claim of Rs.24,81,551/- for the quarter ending December 2008 was filed on 30th June 2009.
Thereafter, on grounds of insufficiency of supporting evidence, both these claims were returned to the applicant on more than one occasion with re-submissions thereon after a lapse of time.
Refunds claims were finally lodged on 22nd February 2011 and 28th February 2011 respectively.
Separate show cause notices for rejection of the refund claim of the two quarters were issued on 6th May 2011.
The claims were rejected by orders dated 20th May 2011 on the ground of being time barred.
The first appellate authority, vide orders dated 30th September 2011, concurred with the original authority that the claims, having been filed only on 20th February 2011 and 28th February 2011, were hopelessly time-barred.
The appellant is before the CESTAT.
The Bench, after considering the submissions and the facts involved, observed -
"10. For the quarters relevant to the two claims, the stipulated deadline was six months from the end of the quarter. Therefore, the appellant did comply with this stipulation. The returns of the applications for rectifying deficiencies and the re-filings thereafter is a clear indication that the competent authorities were not unaware that the claims had been filed on time. If the completeness of the application was sine qua non for admissibility of the application, the claim could well have been rejected by immediate issue of a show cause notice and adjudication thereupon instead of taking the course that it did.
11. With this elapse of time in finalizing the claim for refunds the validity of which was sub silentio not questioned, the original authority appeared to have been actuated by the probability of claim for interest arising from the delay that entailed. To reject the claims thereafter, not on merit but by resort to bar of limitation, at the end of the protracted process reflects lack of responsibility and lack of accountability. That this is so is confirmed in the concurrence with this summary disposal by the first appellate authority.
12. We are constrained to make such an observation because the law on this aspect is well-settled. That the appellant is an exporter whose prices, in accordance with well-entrenched policy, are not to be loaded with the tax element should have been sufficient cause to demonstrate judiciousness in disposing off the claims."
The argument that the appellant had wrongly enhanced the claim during the pendency of the claim was held by the CESTAT to be a non-starter in view of the decision in Premier Tyres Ltd, Kalamassery v Collector of Customs, Madras.
Observing that it is a settled law that the limitation should be computed with effect from date of original, albeit incomplete, filing of refund claim, the Bench held that the appellant is entitled to refund.
The Appeals were allowed.
(See 2016-TIOL-824-CESTAT-MUM)
