2026-VIL-1478-CESTAT-CHD-CU
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CUSTOMS CESTAT Cases

Customs - Special Additional Customs Duty - Refund Claim - Period of Limitation - Subordinate Legislation vs. Substantive Rights - Appellant engaged in business of import and trading of various plastics and textile products filed Bills of Entry for clearance of imported goods in years 2012-2014. Assessing Authority rejected declared value in Bills of Entry and re-determined values under Rule 5 of Customs Valuation Rules, 2007. Appellant challenged assessment before Commissioner (Appeals) who set aside order and accepted declared value on 11.03.2022. On 07.12.2022, appellant filed refund claim for Special Additional Customs Duty (4% SAD) in respect of Bills of Entry. Respondent rejected refund claim on ground of limitation relying upon Notification No. 93/2008-Cus dated 01.08.2008 which prescribed one-year limitation from date of payment of additional duty of customs for filing refund applications. Appellant contends that earlier Notification No. 102/2007-Customs dated 14.09.2007 had no period of limitation and said limitation was prescribed for first time through Notification No. 93/2008-Cus and such limitation cannot be imposed through subordinate legislation without statutory amendment - Whether one-year limitation period prescribed in Notification No. 93/2008-Cus dated 01.08.2008 is valid and applicable to refund claims filed after expiry of prescribed period - HELD - Notification No. 102/2007-Customs as amended by Notification No. 93/2008-Cus prescribed one-year limitation for filing refund claims for additional duty of customs, but said limitation has been read down by Delhi High Court in case of Sony India Pvt. Ltd. v. Commissioner of Customs, New Delhi. High Court held that period of limitation being essential legislative policy aspect cannot be prescribed by subordinate legislation. In matters dealing with substantive rights such as refunds, parent enactment must clearly impose such obligations and subordinate legislation or rules cannot prevail. Imposition of period of limitation for first time without statutory amendment through notification could not prevail. The amending notification must be read down to extent that it imposes limitation period. Tribunal in case of Ghaio Mall and Sons v. Commissioner, Ludhiana followed ratio of Delhi High Court and held that time limitation of one year specified under notification shall not apply until and unless basic provisions of Section 27 of the Act dealing with refunds are made applicable. For provisionally assessed Bill of Entry which has not been finalized, limitation is inapplicable because limitation starts from date of finalization of assessment - Impugned order is not sustainable in law as it rejects refund claim solely on ground of limitation prescribed in notification which has been read down by High Court - Appeal is allowed with consequential relief
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