CORAM : THE HONOURABLE MR. JUSTICE R. MAHADEVAN and THE HONOURABLE MR. JUSTICE J.SATHYA NARAYANA PRASAD C.M.A.No. 384 of 2019 — For Appellant : Mr. A.P. Srinivas Senior Panel Counsel For Respondent : No appearance JUDGMENT R. Mahadevan,

IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 08.06.2022
CORAM :
THE HONOURABLE MR. JUSTICE R. MAHADEVAN and
THE HONOURABLE MR. JUSTICE J.SATHYA NARAYANA PRASAD
C.M.A.No. 384 of 2019
—
The Commissioner of Customs Chennai – IV Commissionerate
Customs House
No.60, Rajaji Salai
Chennai – 600 001
CMS Info Systems Limited
SP-8, Ambattur Industrial Estate Versus .. Appellant
Ambattur, Chennai – 600 058 .. Respondent
Civil Miscellaneous Appeal filed under Section 130 of Customs Act, 1962 against the Final Order No. 41410/2017 in Appeal No.C/40164/2017-SM dated 25.07.2017 passed by the Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench, Chennai.
For Appellant : Mr. A.P. Srinivas
Senior Panel Counsel
For Respondent : No appearance
JUDGMENT
R. Mahadevan, J.
This Civil Miscellaneous Appeal is filed questioning the correctness of the Final Order dated 25.07.2017 passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT).
2.Originally, the respondent / assessee had filed a claim application for refund of 4% additional duty of Customs levied under Section 3 (5) of the Customs Tariff Act, 1975. The claim was originally rejected by an Order-inOriginal dated 17.11.2015 for non-submission of required documents and on limitation ground. On appeal, the appellate authority, by an order-in-appeal dated 06.04.2016, set aside the order-in-original dated 17.11.2015 and directed the adjudicating authority to pass orders afresh, after affording an opportunity of hearing to the respondent/assessee. Pursuant to the order of remand, the adjudicating authority took up the refund application and passed an order-in-original dated 14.07.2016, sanctioning refund of Rs.25,57,262/- in respect of all the Bills of Entry, except two Bills of Entry dated 05.11.2013 and
29.10.2013 on the ground of limitation. According to the Adjudicating Authority, the additional duty was paid on 05.11.2013 and 30.10.2013 respectively, but the application seeking refund was submitted on 14.11.2014 (i.e), after the expiry of one year from the date of payment of duty.
3.Aggrieved against the partial rejection of the claim for refund, the respondent / assessee filed an appeal in C.Cus.II No.914 of 2016 before the Appellate Authority viz., Commissioner of Customs (Appeals-II), Chennai, who placed reliance on the Delhi High Court in M/s. Sony India Pvt Ltd. v Commissioner of Customs, New Delhi [2014 (304) ELT 660 (Delhi)], against which, SLP was filed and the same was subsequently dismissed by the Hon’ble Supreme Court by the decision reported in 2016 (337) ELT 102 (SC), and held that the claim was within limitation of one year from the date of sale, when the right to claim the refund was actually crystallized in terms of Notification No.102/2007-Cus and accordingly, set aside the order-in-original relating to refund claim. As regards the grant of interest on Special Additional Duty (SAD) refund beyond a period of three months from the date of filing, the
Appellate Authority, following the order of the Delhi High Court in Principal
Commissioner of Customs v. M/s.Riso India P. Limited [2016 (333) RLT 33 (Delhi)], held that the assessee was entitled to get the interest and for computing the period of interest, the ruling of the Hon’ble Supreme Court in M/s.Ranbaxy Laboratories Limited v. UOI [2011 (273) ELT (3)(SC)], has to be kept in mind. Accordingly, by order dated 14.10.2016, the Appellate Authority allowed the appeal filed by the respondent / assessee and directed the adjudicating authority to process the claim in respect of two Bills of Entry and pay interest on the delayed refund in terms of section 27A of the Customs Act.
4.Challenging the order-in-appeal dated 14.10.2016 of the Appellate Authority, the appellant / revenue filed an appeal before the CESTAT. Before the Tribunal, on behalf of the revenue, it was contended that the grant of interest on the belated refund of SAD is illegal. After hearing both sides, the Tribunal rejected the appeal, inasmuch as the said issue is covered by the decision of the Delhi High Court in M/s.Riso India Limited case and there being no contrary decision of any other High Court. Aggrieved over the same, the appellant / revenue is before this court with this appeal.
5.Heard the learned senior panel counsel appearing for the appellant / Revenue and also perused the materials available on record, including case laws. Despite the service of notice and the name of the respondent / assessee having been printed in the cause list, there is no representation on their behalf.
6.By order dated 24.01.2019, this appeal was admitted on the following substantial question of law:
“Whether the Tribunal is correct in granting interest under Section 27A of the Customs Act, when the refund of special additional duty is consequent to exemption granted under section 25(1) of the Customs Act, 1962 and it is a special extension granted to the importers under the relevant Notifications and therefore, the refund is granted by virtue of Notification No.102/2007-Customs dated 14.09.2007 and it is not a refund under section 27 of the Customs Act, 1962 and therefore, Section 27A of the Customs Act, 1962 is not applicable to the facts of the case?”
7.From the pleadings as narrated above, it is to be recollected that the claim for refund of SAD duty made by the respondent / assessee, in respect of two Bills of Entry dated 05.11.2013 and 29.10.2013, was rejected, by the adjudicating authority, by order-in-original dated 14.07.2016 on the ground that the said application was filed after the expiry of one year from the date of payment of duty. However, the said order-in-original was set aside by the appellate authority, on the premise that the right to refund arises from the date of sale of the goods and therefore, limitation shall start from the date of sale of the goods and not from the date on which SAD has been paid, following the decision of the Delhi High Court in M/s.Sony India Pvt. Ltd case (supra). The Appellate Authority further held that the respondent / assessee was also entitled for interest on SAD refund beyond a period of three months from the date of filing, in the light of the decision of the Delhi High Court in M/s.Riso India P.Ltd case (supra). Accordingly, the Appellate Authority directed the adjudicating authority to process the claim for refund in respect of two Bills of Entry and also pay the interest on the delayed refund in terms of section 27A of the Customs Act. Feeling aggrieved, the appellant / revenue went on appeal before the CESTAT. The CESTAT after perusal of the appeal papers, was of the view that the Revenue had challenged the order-in-appeal only in respect of grant of interest on the belated refund and hence, restricted the relief to that extent alone. Ultimately, the Tribunal affirmed the order of the Appellate
Authority and rejected the appeal filed by the Revenue as devoid of merit, by Final order dated 25.07.2017, which is impugned in this appeal.
8.During the course of hearing, the learned senior panel counsel appearing for the appellant submitted that the issue involved herein has already been decided by the Bombay High Court in CMS Info Systems Ltd v. Union of India [2017 (349) ELT 236 (Bom)], wherein, after considering the decision of the Delhi High Court in M/s.Sony India Ltd case, it was categorically held
that “the period of limitation as mentioned in the notification dated 14th September, 2007 as amended by the notification dated 1st August 2008 will operate with all the force and therefore, refund will be governed by the limitation as prescribed in the notification”. The learned counsel further submitted that though the decision of the Delhi High Court in M/s.Sony India Ltd’s case was challenged by the Revenue by filing Special Leave Petition, the Hon’ble Supreme Court dismissed the said SLP on the ground of limitation, but kept the substantial question of law open and hence, the ruling of the Delhi High Court did not attain finality. It is also fairly brought to the notice of this court that the aforesaid decision of the Bombay High Court in CMS Info Systems Ltd’s case was put to challenge before the Hon’ble Supreme Court by filing Special Leave to Appeal (Civil)No.11646 of 2017 by the assessee and after granting leave, the same is now, pending consideration.
9.Such being the present position of law, this court, in the given facts and circumstances of the case, sets aside the orders-in-appeals passed by the Appellate Authorities and remands the matter to the Adjudicating Authority for fresh consideration of the application for refund in respect of two Bills of Entry dated 05.11.2013 and 29.10.2013, after providing opportunity of hearing to the parties, based on the outcome of the SLP filed against the order passed by the Bombay High Court in CMS Info System Limited (supra), to be rendered by the Hon’ble Supreme Court.
10.This Civil Miscellaneous Appeal is disposed of in the above terms.
No costs.
(R.M.D.,J.) (J.S.N.P.,J.)
08.06.2022
Index : Yes/No Internet : Yes/No
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R. MAHADEVAN, J. and J. SATHYA NARAYANA PRASAD, J.
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To
1.The Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench, Chennai.
2.The Commissioner of Customs Chennai – IV Commissionerate
Customs House, No.60, Rajaji Salai, Chennai – 600 001
3.The Assistant Commissioner of Customs (Refunds) O/o. Commissioner of Customs (Chennai-IV) Custom House, No.60, Rajaji Salai, Chennai – 1.
4.The Commissioner of Customs (Appeal-II) No.60, Rajaji Salai, Custom House, Chennai – 600 001.
CMA No. 384 of 2019
08.06.2022