nature has been settled by the Karnataka High Court in the case of CCE v. Central Manufacturing Technology Institute reported as

W.P.No.2188 of 2022 For Petitioner : Mr.H.Shabeer Ahmed for Mr.N.Nithianandam For Respondents : Mr.J.Vasu Junior Standing Counsel ORDERThe Petitioner is before this Court against the Impugned Order No.239/2021-CUS (SZ) / ASRA/MUMBAI dated 30.09.2021 passed by the Respondent under Section 129DD of the Customs Act, 1962.2. By the Impugned Order the Revision Application filed by the Commissioner of Customs, Chennai against the Order in Appeal No.Cus.No.115/2010 dated 01.02.2010 has been allowed. The Petitioner had exported consignment of woven woolen garments and had classified the same and had claimed the benefit of Duty drawback under Section 75 of the Customs Act, 1962under Serial No.62.01 of the Duty Draw Back Schedule 1999-2000. 3/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 3. After the Duty Drawback was sanctioned to the Petitioner, the Department issued a Demand Notice on 16.09.2003 purportedly on the strength of Circular No.55/99-Cus dated 25.08.1999. Text of the Circular reads as under:-“Circular: 55/99-Cus dated 25-Aug-1999Drawback on readymade woollen garmentsCircular No.55/99-Cus., dated 25.08.1999[From F.No.600/62.01 & 62.09/99-DBK]Government of IndiaMinistry of Finance (Department of Revenue)New DelhiSubject: Duty Drawback on Readymade Woollen GarmentsSome doubts have been raised by the field formations and certain sections of the Trade as regards the applicability of All Industry Rate of Drawback under S.S.No.62.01 of the Drawback Table to the Woollen Garments not specified in S.S.No.62.09 ibid.The issue has been examined and it is clarified that sub-serial No.62.01 of the Drawback Table is not applicable to Woollen Readymade Garments. It is also clarified that S.S.No.62.09 is applicable to only Woollen Suits/Trousers/Blazers/Jackets, therefore, Woollen Garments other than these categories are 4/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 not covered by any of the S.S.Nos. of Drawback Table and hence the exporters can only claim Brand rate for the same. This may be brought to the notice of all concerned.”4. Ultimately the above notice was challenged by the Petitioner in W.P.No.2524 of 2005. By an Order dated 07.11.2006, the said Writ Petition was disposed of with the following observations:-“5. Hence, the Writ Petition is disposed of with a direction to the petitioner to appear before the respondents for enquiry permitting the petitioner to take the point of bar of limitation also, face the enquiry and proceed further. The respondents are directed to consider the objections filed by the petitioner and also the point of bar of limitation. If the point of limitation taken by the petitioner is sustainable in law, that has to be decided first. The respondents are directed to give the fresh dates of hearing. No costs. Consequently, the above WPMP is dismissed.”5. Pursuant to the aforesaid directions of this Court, the 5th Respondent herein viz., the Deputy Commissioner of Customs (Sea) Draw Back passed Order in Original No.7606 of 2008 on 15.04.2008 whereby the Petitioner was called upon to pay back the Duty drawback that was sanctioned to the Petitioner on the exports made by the 5/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 Petitioner during the period between 1999-2000.6. The Order passed by the 5th Respondent was reversed on appeal by the 2nd Respondent/Commissioner of Customs (Appeals) vide Order in Appeal C.Cus No.115/2010 dated 01.02.2010.7. Thus, the Order of the 5th Respondent stood reversed. Aggrieved by the same, the Commissioner of Customs filed revision under Section 129DD of the Customs Act, 1962, before the 1st Respondent who has passed the Impugned Order whereby the Order of the Appellate Commissioner has been reversed. 8. Operative portion of the Impugned Order of the 1st Respondent reads as under:- 9. On perusal of records, it is observed that respondent had exported woven woolen ladies vests vide 5 shipping bills and claimed drawback of duty under S.S.No.62.01. The total drawback claims of Rs. 5,14,694/ were sanctioned and paid to exporter in July/August, 1999. Subsequently, on the basis of audit objection it was noticed that said goods are neither covered under drawback schedule S. S. No. 62.01 nor any other heading and therefore they 6/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 were not eligible for All Industry Drawback Rate. After due process of law, the demand for erroneously paid draw back was confirmed under Rule 16 of Custom, Central Excise Duties and Service Tax Drawback Rule, 1995. In appeal, Commissioner (Appeals) allowed the appeal of the respondents and set aside impugned order-in-original. The department contested the said order-in-appeal which was set aside by the Joint Secretary (Revision Application). As per the order of the Hon'ble Court, matter is again being reexamined.10. Government observes that the respondent has claimed drawback on export of goods which were classified by them under S.S No. 62.01. It is further noted that S.S. No 62.09 covers woollen garments namely woollen suits/trousers/blazers/jackets excluding those made of shoddy fabrics/yarn. The items exported by the respondent i.e 'Woven woollen ladies vests' does not fall in S.S No 62.09 and there is no heading in the Drawback Schedule 1999-2000 which covers the subject exports of the respondent.11. Government notes that the CBEC vide Circular No 55/99 dated 25.08.1999 has clarified as under:-"since doubts has been raised by the field formations and certain sections of The Trade as regards the applicability of All Industry Rate of Drawback under S.S. No. 62.01of the Drawback Table to the Woollen Garments not specified in S.S.No 62.09 ibidThe issue has been examined and it is clarified that sub-serial No 62.01 of the Drawback Table is not applicable to Woollen Readymade Garments. It is also clarified that S.S. No 62.09 is applicable to only woollen Suits/Trousers/Blazers/Jackets, 7/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 therefore woollen garments other than these categories are not covered by any of the S.S. Nos of Drawback Table and hence the exporters can only claim Brand Rate for the same12. Government notes and opines that the Appellate Authority has failed to distinguish that the Boards Circular dated 25.08.1999 is in the nature of a clarification and when an issue is clarified the cause of such clarification would have been based on some confusion on an issue which was in existence before the said clarification was issued and thus has been issued to bring clarity by removing confusion, if any, and would therefore, have a retrospective effect in its implementation.13. Government notes that the question whether the issue of circular and notifications are retrospective or prospective in nature has been settled by the Karnataka High Court in the case of CCE Bangalore vs Central Manufacturing Technology Institute reported as 2002 (142) ELT 336(Kar) wherein it has been held that clarificatory notifications are retrospective in nature. Instant circular is clearly a clarificatory circular.14. Government notes that issue clarified in the CBEC circular dated 25.08.1999 is akin to the issue in the instant case and justifies the rejection of the drawback claim in the impugned order in original which was set aside by the Appellate Authority15. Government notes that the Appellate Authority has erred in holding the the Circular cannot be given retrospective effect and allowing the appeal of the respondent.8/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 16. In light of the above discussion, Government observes that the Order- in-Appeal No.C. Cus No.115/2010 dated 01.02.2010 passed by Commissioner of Customs (Appeals), Chennai is not sustainable and therefore the same is set aside. The impugned order in original is restored.17. Revision Application is disposed off on the above terms.”9. The Impugned Order is challenged by the Petitioner primarily on the ground that the denial of Duty drawback long after the export were made and the benefits which were extended have been denied pursuant to Circular No.55/99-Cus dated 25.08.1999, content of which has been extracted above.10. It is submitted that the Impugned Order seeks to levy tax on the strength of said Circular retrospectively. It is submitted that the Circular was not available at the time of export made by the Petitioner and therefore, export incentives recognized by the Appellate Commissioner ought not to have been reversed. 9/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 11. The respondents/Department has not filed any counter affidavit.12. The writ petition is of the year 2022. I have perused the order passed by the second respondent/Revisional Authority.13. In my view, the order does not call for any interference. The issue has been examined by the Revisional Authority in the light of the decision of the Karnataka High Court in the case of CCE Bangalore Vs. Central Manufacturing Technology Institute reported in 2002 (142) ELT 336(Kar), wherein, it has been held that clarificatory notifications are retrospective in nature. The petitioner was not entitled to drawback claim as the product exported by the petitioner was Woolen Readymade Garments. It has been clarified by CBEC Circular No.55/99 dated 25.08.1999 that S.S.NO.62.09 is applicable to only woollen Suits/Trousers/Blazers/Jackets, therefore woollen garments other than these categories are not covered by any of the S.S. Nos of Drawback Table and hence the exporters can only claim Brand Rate for the same.10/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 14. Hence, this Writ Petition is dismissed. No costs. Consequently, connected writ miscellaneous petition is closed. 03.10.2024Index : Yes/NoInternet : Yes/NoSpeaking Order/Non-Speaking OrderNeutral Citation : Yes/Nojas11/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 To1.Union of India, Rep by its Joint Secretary to Government, Department of Revenue, Ministry of Finance, 14, HUDCO Visala Building, D Wing, 6th Floor, BhiklhajiCama Place, New Delhi – 110 066.2.The Principal Commissioner RA and Ex-Officio Additional Secretary to the Government of India, Office of the Principal Commissioner RA and Ex-Officio, Additional Secretary to the Government of India, 8th Floor, World Trade Centre, Cuffe Parade, Mumbai – 400 005.3.The Commission of Customs (Appeals), Chennai.4.The Commissioner of Customs (Exports), Custom House, Chennai.5.The Deputy Commissioner of Customs (Sea) Draw Back, Custom House, No.33, Rajaji Salai, Chennai – 600 001.6.The Assistant Commissioner of Customs (EDI-DPK),12/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 Custom House, No.33, Rajaji Salai, Chennai – 600 001.C.SARAVANAN, J.jas W.P.No.2188 of 2022andW.M.P.No.2357 of 202203.10.202413/13

W.P.No.2188 of 2022 For Petitioner : Mr.H.Shabeer Ahmed for Mr.N.Nithianandam For Respondents : Mr.J.Vasu Junior Standing Counsel ORDERThe Petitioner is before this Court against the Impugned Order No.239/2021-CUS (SZ) / ASRA/MUMBAI dated 30.09.2021 passed by the Respondent under Section 129DD of the Customs Act, 1962.2. By the Impugned Order the Revision Application filed by the Commissioner of Customs, Chennai against the Order in Appeal No.Cus.No.115/2010 dated 01.02.2010 has been allowed. The Petitioner had exported consignment of woven woolen garments and had classified the same and had claimed the benefit of Duty drawback under Section 75 of the Customs Act, 1962under Serial No.62.01 of the Duty Draw Back Schedule 1999-2000. 3/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 3. After the Duty Drawback was sanctioned to the Petitioner, the Department issued a Demand Notice on 16.09.2003 purportedly on the strength of Circular No.55/99-Cus dated 25.08.1999. Text of the Circular reads as under:-“Circular: 55/99-Cus dated 25-Aug-1999Drawback on readymade woollen garmentsCircular No.55/99-Cus., dated 25.08.1999[From F.No.600/62.01 & 62.09/99-DBK]Government of IndiaMinistry of Finance (Department of Revenue)New DelhiSubject: Duty Drawback on Readymade Woollen GarmentsSome doubts have been raised by the field formations and certain sections of the Trade as regards the applicability of All Industry Rate of Drawback under S.S.No.62.01 of the Drawback Table to the Woollen Garments not specified in S.S.No.62.09 ibid.The issue has been examined and it is clarified that sub-serial No.62.01 of the Drawback Table is not applicable to Woollen Readymade Garments. It is also clarified that S.S.No.62.09 is applicable to only Woollen Suits/Trousers/Blazers/Jackets, therefore, Woollen Garments other than these categories are 4/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 not covered by any of the S.S.Nos. of Drawback Table and hence the exporters can only claim Brand rate for the same. This may be brought to the notice of all concerned.”4. Ultimately the above notice was challenged by the Petitioner in W.P.No.2524 of 2005. By an Order dated 07.11.2006, the said Writ Petition was disposed of with the following observations:-“5. Hence, the Writ Petition is disposed of with a direction to the petitioner to appear before the respondents for enquiry permitting the petitioner to take the point of bar of limitation also, face the enquiry and proceed further. The respondents are directed to consider the objections filed by the petitioner and also the point of bar of limitation. If the point of limitation taken by the petitioner is sustainable in law, that has to be decided first. The respondents are directed to give the fresh dates of hearing. No costs. Consequently, the above WPMP is dismissed.”5. Pursuant to the aforesaid directions of this Court, the 5th Respondent herein viz., the Deputy Commissioner of Customs (Sea) Draw Back passed Order in Original No.7606 of 2008 on 15.04.2008 whereby the Petitioner was called upon to pay back the Duty drawback that was sanctioned to the Petitioner on the exports made by the 5/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 Petitioner during the period between 1999-2000.6. The Order passed by the 5th Respondent was reversed on appeal by the 2nd Respondent/Commissioner of Customs (Appeals) vide Order in Appeal C.Cus No.115/2010 dated 01.02.2010.7. Thus, the Order of the 5th Respondent stood reversed. Aggrieved by the same, the Commissioner of Customs filed revision under Section 129DD of the Customs Act, 1962, before the 1st Respondent who has passed the Impugned Order whereby the Order of the Appellate Commissioner has been reversed. 8. Operative portion of the Impugned Order of the 1st Respondent reads as under:- 9. On perusal of records, it is observed that respondent had exported woven woolen ladies vests vide 5 shipping bills and claimed drawback of duty under S.S.No.62.01. The total drawback claims of Rs. 5,14,694/ were sanctioned and paid to exporter in July/August, 1999. Subsequently, on the basis of audit objection it was noticed that said goods are neither covered under drawback schedule S. S. No. 62.01 nor any other heading and therefore they 6/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 were not eligible for All Industry Drawback Rate. After due process of law, the demand for erroneously paid draw back was confirmed under Rule 16 of Custom, Central Excise Duties and Service Tax Drawback Rule, 1995. In appeal, Commissioner (Appeals) allowed the appeal of the respondents and set aside impugned order-in-original. The department contested the said order-in-appeal which was set aside by the Joint Secretary (Revision Application). As per the order of the Hon'ble Court, matter is again being reexamined.10. Government observes that the respondent has claimed drawback on export of goods which were classified by them under S.S No. 62.01. It is further noted that S.S. No 62.09 covers woollen garments namely woollen suits/trousers/blazers/jackets excluding those made of shoddy fabrics/yarn. The items exported by the respondent i.e 'Woven woollen ladies vests' does not fall in S.S No 62.09 and there is no heading in the Drawback Schedule 1999-2000 which covers the subject exports of the respondent.11. Government notes that the CBEC vide Circular No 55/99 dated 25.08.1999 has clarified as under:-"since doubts has been raised by the field formations and certain sections of The Trade as regards the applicability of All Industry Rate of Drawback under S.S. No. 62.01of the Drawback Table to the Woollen Garments not specified in S.S.No 62.09 ibidThe issue has been examined and it is clarified that sub-serial No 62.01 of the Drawback Table is not applicable to Woollen Readymade Garments. It is also clarified that S.S. No 62.09 is applicable to only woollen Suits/Trousers/Blazers/Jackets, 7/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 therefore woollen garments other than these categories are not covered by any of the S.S. Nos of Drawback Table and hence the exporters can only claim Brand Rate for the same12. Government notes and opines that the Appellate Authority has failed to distinguish that the Boards Circular dated 25.08.1999 is in the nature of a clarification and when an issue is clarified the cause of such clarification would have been based on some confusion on an issue which was in existence before the said clarification was issued and thus has been issued to bring clarity by removing confusion, if any, and would therefore, have a retrospective effect in its implementation.13. Government notes that the question whether the issue of circular and notifications are retrospective or prospective in nature has been settled by the Karnataka High Court in the case of CCE Bangalore vs Central Manufacturing Technology Institute reported as 2002 (142) ELT 336(Kar) wherein it has been held that clarificatory notifications are retrospective in nature. Instant circular is clearly a clarificatory circular.14. Government notes that issue clarified in the CBEC circular dated 25.08.1999 is akin to the issue in the instant case and justifies the rejection of the drawback claim in the impugned order in original which was set aside by the Appellate Authority15. Government notes that the Appellate Authority has erred in holding the the Circular cannot be given retrospective effect and allowing the appeal of the respondent.8/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 16. In light of the above discussion, Government observes that the Order- in-Appeal No.C. Cus No.115/2010 dated 01.02.2010 passed by Commissioner of Customs (Appeals), Chennai is not sustainable and therefore the same is set aside. The impugned order in original is restored.17. Revision Application is disposed off on the above terms.”9. The Impugned Order is challenged by the Petitioner primarily on the ground that the denial of Duty drawback long after the export were made and the benefits which were extended have been denied pursuant to Circular No.55/99-Cus dated 25.08.1999, content of which has been extracted above.10. It is submitted that the Impugned Order seeks to levy tax on the strength of said Circular retrospectively. It is submitted that the Circular was not available at the time of export made by the Petitioner and therefore, export incentives recognized by the Appellate Commissioner ought not to have been reversed. 9/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 11. The respondents/Department has not filed any counter affidavit.12. The writ petition is of the year 2022. I have perused the order passed by the second respondent/Revisional Authority.13. In my view, the order does not call for any interference. The issue has been examined by the Revisional Authority in the light of the decision of the Karnataka High Court in the case of CCE Bangalore Vs. Central Manufacturing Technology Institute reported in 2002 (142) ELT 336(Kar), wherein, it has been held that clarificatory notifications are retrospective in nature. The petitioner was not entitled to drawback claim as the product exported by the petitioner was Woolen Readymade Garments. It has been clarified by CBEC Circular No.55/99 dated 25.08.1999 that S.S.NO.62.09 is applicable to only woollen Suits/Trousers/Blazers/Jackets, therefore woollen garments other than these categories are not covered by any of the S.S. Nos of Drawback Table and hence the exporters can only claim Brand Rate for the same.10/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 14. Hence, this Writ Petition is dismissed. No costs. Consequently, connected writ miscellaneous petition is closed. 03.10.2024Index : Yes/NoInternet : Yes/NoSpeaking Order/Non-Speaking OrderNeutral Citation : Yes/Nojas11/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 To1.Union of India, Rep by its Joint Secretary to Government, Department of Revenue, Ministry of Finance, 14, HUDCO Visala Building, D Wing, 6th Floor, BhiklhajiCama Place, New Delhi – 110 066.2.The Principal Commissioner RA and Ex-Officio Additional Secretary to the Government of India, Office of the Principal Commissioner RA and Ex-Officio, Additional Secretary to the Government of India, 8th Floor, World Trade Centre, Cuffe Parade, Mumbai – 400 005.3.The Commission of Customs (Appeals), Chennai.4.The Commissioner of Customs (Exports), Custom House, Chennai.5.The Deputy Commissioner of Customs (Sea) Draw Back, Custom House, No.33, Rajaji Salai, Chennai – 600 001.6.The Assistant Commissioner of Customs (EDI-DPK),12/13 https://www.mhc.tn.gov.in/judis W.P.No.2188 of 2022 Custom House, No.33, Rajaji Salai, Chennai – 600 001.C.SARAVANAN, J.jas W.P.No.2188 of 2022andW.M.P.No.2357 of 202203.10.202413/13