Technical Glitch in EDI System Prevented Exemption Claim, Leading to Excess Payment by M/s JK (India) Fabs
In a significant ruling, the Delhi High Court has directed the reassessment of Bill of Entries for M/s JK (India) Fabs, enabling them to claim a refund of excess customs duty paid due to a technical glitch in the Electronic Data Interchange (EDI) system. The glitch had prevented the petitioner from claiming an exemption under the Notification 1/2016-Infrastructure Cess for electrically operated vehicles, including golf carts.
The division bench, comprising Justices Prathiba M. Singh and Shail Jain, heard the petition filed under Articles 226 and 227 of the Constitution of India. The petitioner, represented by Mr. Sourabh Kapoor, contended that despite importing golf carts which qualify for exemption, the technical issues on the EDI system led to an excess payment of customs duty. The petitioner had paid Rs. 3,51,303 against the actual duty of Rs. 2,95,426.71 due to the glitch.
The court noted the Department's stance that refund claims cannot be processed without reassessment of the Bill of Entries and cited the Supreme Court's decision in M/s ITC Ltd. v. C.C.E. Kolkata-IV, which mandates reassessment before issuing refunds. The court also observed that the Department failed to address the technical glitch allegations in its counter affidavit.
Considering the circumstances, the court instructed the Department to reassess the Bill of Entries within two months, after which the refund must be processed in accordance with the Notification 1/2016-Infrastructure Cess dated March 1, 2016. The judgment brings relief to M/s JK (India) Fabs, ensuring compliance with the exemption policies intended for electrically operated vehicles.
Bottom Line:
Customs Duty - Refund claim due to excess payment caused by technical glitch in EDI system - Reassessment of Bill of Entries necessary to process refund - Refund cannot be directly issued without reassessment.
Statutory provision(s): Customs Act, 1962 Section 27, Notification 1/2016-Infrastructure Cess
M/s JK (India) Fabs v. Union of India, (Delhi)(DB) : Law Finder Doc Id # 2821879
