SHREE ELECTROMELTS LTD. Vs. CC

JUDGEMENT

(1.) THE appellant filed a Bill of Entry on 3.2.2005 which was provisionally assessed. Thereafter, the order of final assessment was made on 27.12.06 by making an endorsement in Bill of Entry. In this case, the question was whether the appellant is liable to pay the coal cess @ 4.25 PMT or Rs. 10/ - PMT. After final assessment on the very same day, show cause notice was issued to the appellant, demanding coal cess amounting to Rs. 42,500/ - being differential cess payable by the appellant under provisions of Section 28 of Customs Act, 1962. This show cause notice culminated into adjudication order passed by original adjudicating authority dt.29.10.07, whereby the original adjudicating authority not only dropped the demand of Rs. 59,500/ - but also held that Rs. 42,500/ - already paid towards coal cess was also not liable to be paid and ordered the appellant to file refund claim of Rs. 42,500/ -. Accordingly, the appellant filed a refund claim which has been rejected on the ground that the appellant had not challenged the final assessment order passed by endorsement in the bill of entry.

(2.) NO one appeared for the appellant. But, written submissions have been made by the appellant, which I have gone through and also heard the learned SDR, who reiterated the department s view that unless an appeal is filed against the order finalizing the provisional assessment, refund claim should not have been filed. I find that in this case, provisional assessment was finalized by endorsement on 27.12.06 and taking note of the fact that there was a short payment of Rs. 59,500/ - on the same date, a show cause notice was issued by the department. According to the provisions of Section 18(2)(a) relating to provisional assessment, when the amount paid by the importer falls short of amount of duty payable, the importer or exporter is required to pay deficit amount. Needless to say that finalization of assessment resulting in shortfall in payment, should have been done after giving an opportunity to the appellant by way of issue of show cause notice, which was not done in this case. This omission has been made good by the department by issue of show cause notice on the same date, demanding differential duty of Rs. 59,500/ - consequent to finalization of assessment. Therefore, I do not find any reason why the importer should challenge final assessment in view of the fact that finalization resulted in short payment and a show cause notice was issued. In view of the peculiar facts and circumstances of this case, the assessment got really finalized only when the adjudication order was passed on 29.10.07 and not on 27.12.06, when endorsement was made in bill of entry. Therefore, the contention of the Revenue that appeal should have been filed against the finalization of assessment, is not correct. Therefore, I find that the appellant s action in filing refund claim in terms of direction issued in the adjudication order passed by the original adjudicating authority is appropriate. Further, the original adjudicating authority while adjudicating the show cause notice, has also followed the correct procedure prescribed under Section 18, which provides that when there is a shortfall, the assessee shall pay deficient or amount in excess is refunded. In view of the settled law, even in the cases of provisional assessment finalization, refund claims are required to be filed under Section 27 and are required to be examined, the order of the original adjudicating authority is within the four corners of law. Therefore, rejection of refund claim on the ground that the endorsement in bill of entry was not challenged by way of appeal, cannot be justified.