M/S Tata International Limited vs. The Assistant Commissioner Of Customs (Dbk/Refund), Kolkata And Ors

Held

The Court held that the petitioner was not afforded an adequate opportunity to address the grounds on which their IGST refund claim was rejected. The Court found that these grounds were disclosed for the first time in the impugned order dated December 20, 2019. Therefore, in the interest of natural justice, the Court treated the impugned order itself as a show cause notice. The petitioner was granted liberty to file objections to this notice, including addressing the points raised in the writ petition, within two weeks. The respondent authorities are directed to pass a fresh speaking order after considering the petitioner's objections and providing an opportunity for a hearing, within eight weeks of receiving the objections. The ratio decidendi is that a party must be given a fair opportunity to respond to all grounds on which a decision adverse to them is contemplated, especially when those grounds are not previously known.

Facts

M/s. Tata International Limited (the petitioner) filed a writ petition challenging an order dated December 20, 2019, passed by the Assistant Commissioner of Customs, IGST Refund Cell (Port), Kolkata. This order rejected the petitioner's claim for a refund of IGST, which was based on shipping bills submitted on November 4, 2019. The respondents, represented by the Customs Authority, argued that the refund claim was not legally tenable because the petitioner had allegedly relinquished such a claim at the time of export. The petitioner denied this assertion. The impugned order cited a Board circular dated October 9, 2018, and other grounds for rejection.

Key Issues

1. Whether the petitioner was denied an opportunity to respond to the grounds for rejection of their IGST refund claim, thereby violating principles of natural justice? (Mixed question of law and fact, concerning principles of natural justice and procedural fairness). Petitioner's Argument: The petitioner contended that the grounds for rejecting their IGST refund claim were disclosed for the first time in the impugned order, and they were not given an opportunity to address these grounds. This failure to provide an opportunity to be heard violates the principles of natural justice. Revenue's Argument: The respondents (Customs Authority) argued that the IGST refund claim was not tenable in law because the petitioner had already relinquished such a claim at the time of export. They relied on a Board circular dated October 9, 2018, and other grounds mentioned in the impugned order.