Chapter 26

Appeal and Review/Settlement of cases

Appeal to Commissioner (Appeal)/CEGAT

Chapter XV of Customs Act incorporates the provisions regarding appeals and revision. Under Section 128 an appeal lies to the Commissioner of Customs (Appeals) against any decision or order passed under that Act by an Officer of Customs lower in rank than a Commissioner of Customs.

Under Section 129A (as it stands at present) an appeal lies to the Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT for short) against-

- any decision or order passed by a Commissioner of Customs as an adjudicating authority; or

- an order passed by the Commissioner (Appeals) under Section 128;

Revision Application:

2. The first proviso to Section 129A(1) take away this appellate jurisdiction of CEGAT for certain categories of cases enumerated therein. These cover baggage, Drawback and short-landing cases. In these cases, aggrieved person may file an application for revision before the Central Government as provided in section 129 DD.

3. Section 129A(2) provides for appeals at the instance of the Commissioner against orders passed by either an Appellate Collector or Commissioner (Appeals). It may be further noted that under Section 129A(4) a right to file cross objections has been provided, such cross objections also having the force of an appeal. Under Section 129D of the Customs Act, the Board and the Commissioner are given right, in suitable cases, to direct the lower adjudicating authority to apply to the Tribunal or the Commissioner (Appeals) respectively to determine any points in the order of the adjudicating authority which, according to them, have been wrongly decided. Section 129D(4) provides that such applications shall be heard as appeals and the provisions of Section 129A(4) shall also apply to such proceedings.

Appeal to Supreme Court:

Under Section 130E of the Customs Act, an appeal lies to the Supreme Court against-

(i) any judgement of a High Court delivered on a reference under Section 130 or Section 130A, provided the High Court had certified it to be a fit case for such an appeal;

(ii) an order of the CEGAT, relating among other things to the determination of any question having relation to the rate of duty of customs or to the value of the goods for purposes of assessment.

Time limit for filing Appeal and Form of Appeal:

4. Under the amended provisions the appeal is to be filed within 60 days from the date of communication of such decision or order. In the event of the appellant showing sufficient cause which prevented him from filing the appeal within the specified period of 60 days, the Commissioner (Appeals) can condone the delay of a further period of 30 days. It should be noted that the Commissioner (Appeals) is not empowered to condone delay beyond 30 days. The appeal before the Commissioner (Appeals) is to be filed in Form No.C.A.1. in duplicate and is to be accompanied by a copy of decision or order appealed against. The grounds of appeal and the form of verification as contained in form No.C.A.1 is to be signed by the appellant. The time limit for filing appeal before Appellate Tribunal is three months from the date on which the order to be appealed against is communicated to the appellant. Upon showing sufficient cause, the Tribunal can condone delay in filing appeal before it. Appeal to the Appellate Tribunal is to be filed in Form No.C.A.3 and is to be verified in the prescribed manner and has to be accompanied by the prescribed fee and prescribed documents. One should refer to Sections 128, 128A, 129A, 129B & 129C of the Act, Customs (Appeals) Rules, 1982 and CEGAT (Procedure) Rules, 1982.

5. Sub-section 4A of Section 128A of the Act requires the Commissioner (Appeals) to as far as possible decide every appeal within six months from the date on which it is filed.

Revenue Appeals:

6. Under the provisions of Section 129D the revenue is also permitted to file appeals under the Customs Act. In case an order or decision has been passed by an Additional Commissioner or Joint Commissioner or Deputy Commissioner or Assistant Commissioner or Appraiser/Supdt., the jurisdictional Commissioner of Customs can examine the propriety and legality of such order and issue direction under section 129D(2) of the Customs Act to the adjudicating authority to apply before Commissioner (Appeals) for determination of such points as specified in the review order. The review order is to be passed within a period of one year from the date of decision or order. The application before the Commissioner (Appeals) is to be filed within three months from the date of communication of the review order.

7. The jurisdictional Commissioner of Customs can examine the legality or propriety of an order-in-appeal passed by Commissioner (Appeals). In case he finds the order of Commissioner (Appeals) to be not legal or proper, he can direct any Customs Officer (authorised by him in this behalf) to file an appeal on his behalf to the Appellate Tribunal against the said order of Commissioner (Appeals). Such an appeal is to be filed within a period of three months from the date on which such order is communicated to the Commissioner of Customs.

8. The Board can review the Order-in-Original passed by a Commissioner of Customs as an adjudicating authority. In case Board is not satisfied with the legality or propriety of such order, it can direct the Commissioner to apply before the Appellate Tribunal for determination of such points as may be specified in the review order. Review by Board under Section 129D(1) is to be completed within one year from the date of decision or order of the adjudicating authority. The application before the Appellate Tribunal in pursuance of that direction is to be filed within three months from the date of communication of the review order.

Memorandum of cross objections:

9. Sub-section 4 of Section 129A provides for filing a memorandum of cross objections, verified in the prescribed manner by the respondent, to be filed within forty-five days of the receipt of notice of filing of appeal before the Tribunal. In the said cross objections, the respondent can agitate against any part of the order appealed against and such cross objections are disposed of by the Tribunal as if it were an appeal. Rules 15 and 15A of the CEGAT (Procedure) Rules, 1982 allows filing of reply to such appeal within a month by the respondent, and rejoinder to the reply within a month by the appellant. Attention is also invited to Rule 6 of the Customs (Appeals) Rules, 1982 in this regard.

Pre deposit of Duty demanded or penalty levied:

10. Section 129E of the Customs Act requires that a person desirous of appealing against a decision or order of the Officer of Customs before Commissioner (Appeals) or the Appellate Tribunal shall, pending the appeal, deposit with the adjudicating authority the duty demanded or the penalty levied. In case an appellant is not in a position to pre-deposit the entire amount of duty demanded or penalty levied, the appellant should file the stay application for waiver of pre-deposit. . The Commissioner (Appeals) and the Appellate Tribunal are empowered to waive pre-deposit, either fully or partially, if the appellant is able to show that pre-deposit of duty or penalty levied would cause undue hardship to such person. As per the amended provisions of Section 129E, Commissioner (Appeals) is required, wherever it is possible to do so, to decide a stay application within thirty days from the date of its filing.

Reference to High Court:

11. Section 130A of the Customs Act provides that within one hundred and eighty days of receipt of order of Tribunal passed under Section 129B, a person can file an application in prescribed from (Form No.C.A.6) if the order of the Tribunal does not relate to determination of any question having relation to the rate of duty of customs or the valuation of goods for purposes of assessment. Hence, it should be noted that High Court can not be approached under this provision if the issue relates to classification or valuation of the goods.

Civil Appeal before the Supreme Court:

12. In case the order of the Tribunal passed under Section 129B relates to classification or valuation, direct appeal lies to the Supreme Court of India in terms of Section 130E(b). Similarly, one can file civil appeal before the Supreme Court against the order of the High Court delivered on a reference made under Section 130 or 130A if the High Court certifies the same to be fit case for appeal to the Supreme Court. The time limit for filing civil appeal before the Supreme Court is sixty days only.

Settlement Commission:

13. An alternative channel for resolution of dispute for assessees finally- without going into the prolonged litigation in adjudication/appeals/revisions etc., has been created by constituting Customs & Central Excise Settlement Commission. (Provisions of section 127A to 127N of the Customs Act refer). Presently, three Benches in the Settlement Commission have been constituted and they are functioning at Delhi, Mumbai and Chennai . The fourth bench at Kolkata will be constituted in due course.

Section 127B of the Customs Act provides filing of application by the assessee for settlement of cases before the Settlement Commission. Certain conditions are prescribed which inter-alia require that the Settlement Commission cannot entertain the cases which are pending with the Appellate Tribunal or in a Court. Similarly, the matters relating to classification cannot be raised before the Commission. It is also specified that no application can be made unless the appellant has filed a bill of entry, or a shipping bill etc., or a show cause notice issued by proper Officer and the additional amount of duty accepted by the applicant in his application exceeds two lakh rupees.

The procedure prescribed essentially requires examination of the application for its acceptability under Settlement provisions, payment of additional duty admitted by the applicant, calling and examination of records from jurisdictional Commissioner of Customs, getting further enquiries/investigations caused from Commissioner of Customs or Commissioner (Investigation) attached to Settlement Commission, giving opportunity for detailed submission to the applicant and passing order by the Commission. Every order passed by the Settlement Commission under Section 127J is conclusive as to the matters stated therein and no matter covered by such order can be reopened in any proceedings. The Settlement Commission can consider immunity from prosecution proceedings if the applicant cooperates with the Commission in the proceedings before it and makes full and true disclosure of his duty liability. Even grant of immunity, whole or part, from imposition of penalty, fine and interest may also be considered.

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