ORDER
P.G. Chacko, Member (J)
1. The appellants are aggrieved by the order of the Commissioner of Customs (Appeals) setting aside the order of the original authority sanctioning refund of customs duty.
2. The facts of the case are that the appellants had cleared various consignments of imported parts of Air Conditioners under nine Bills of Entry on payment of duty as provisionally assessed by the Assistant Commissioner of Customs (SVB) by enhancing the assessable value of the goods by 20% of the declared value; that the Assistant Commissioner, by order dated 14.3.97 which was passed in de novo proceedings pursuant to a remand order of the Commissioner (Appeals), accepted the declared value for assessment of the goods; that the provisional assessments were finalised accordingly as directed by the Commissioner of Customs (Import); that the appellants filed application for refund of the excess customs duty paid on the nine Bills of Entry; that the Deputy Commissioner of Customs concerned sanctioned the refund as per Order-in-Original dated 23.7.99 (issued on 1.9.99); that the Commissioner of Customs (Import) by Review Order dated 28.7.2000 directed appeal to be preferred against the said Order-in-original; and that the appeal filed accordingly by the department was allowed by the Commissioner (Appeals). The order of the lower appellate authority, which is under challenge in the present appeal, reads as under:
“I have been through the records of the case and heard the respondents. Impugned order had been issued on 1.9.99 and the Commissioner has ordered review vide order dated 28.7.2000 as such the review has been ordered within time.
The main ground taken up in the departmental appeal is that the doctrine of unjust enrichment has not been examined and that the adjudicating authority has relied upon the interim order of the Hon’ble Supreme Court. I find that this view is correct in view of the findings of the adjudicating authority. He has relied upon the interim order of the Supreme Court though the Apex Court has given final verdict and laid down the law in this matter. It is also seen that there is no discussion on the aspect of unjust enrichment. The impugned order is, therefore, not legal and proper.
I, therefore, set aside the impugned order and allow the departmental appeal.”
3. Heard both the sides. The counsel for the appellants, reiterating the main ground of the appeal, submitted that the Deputy Commissioner’s order passed on 23.7.99 was not reviewed by the Commissioner within the period of one year prescribed under Sub-section (2) of Section 129-D of the Customs Act. The review order passed by the Commissioner on 28.7.2000 was time-barred and consequently the appeal filed with the Commissioner (Appeals) by the department against the Deputy Commissioner’s order was not maintainable. The learned counsel relied on the Supreme Court’s judgment in CCE v. MM, Rubber Co., 1992 (37) ECC 16 (SC) : 1991 (55) ELT 289 (SC) and the Tribunal’s decision in the cases of Solid Containers ltd. v. CCE, 1993 (68) ELT 598 and Polycoat Powders (P) Ltd. v. CCE, 1998 (60) ECC 641 (T) : 1998 (100) ELT 172. The counsel also argued on the merits of the case, drawing support from case law. Vis-a-vis the main ground raised in the appeal, the learned SDK argued that the review order was not to be treated as time-barred as it had been passed within one year from the date of issue of the Deputy Commissioner’s order. She also sought to distinguish the aforecited decisions by pointing out that none of the decisions had anything to do with Section 129-D of the Customs Act.
4. We have carefully considered the submissions. The Deputy Commissioner’s order allowing the refund applications was passed, admittedly, on 23.7.99. It was issued on 1.9.99. The order was reviewed suo motu by the Commissioner on 28.7.2000 under Sub-section (2) of Section 129D, pursuant to which the department preferred appeal to the Commissioner (Appeals) against the Deputy Commissioner’s order. If the Commissioner’s order to review was beyond the period of one year prescribed under Section 129D, then the department’s appeal was not maintainable. Therefore, the preliminary issue before us is whether the order of review was passed within the period of limitation prescribed by the statute. The power of suo motu review of any decision or order passed by any adjudicating authority subordinate to him has been conferred on Commissioner of Customs under Sub-section (2) of Section 129D of the Customs Act. The period of limitation for exercise of this power has been prescribed under Sub-section (3) of that Section, which reads as under:
“No order shall be made under Sub-section (1) Sub-section (2) after the expiry of [one year] from the date of the decision or order of the adjudicating authority.”
We note that the corresponding provision of the Central Excise Act, 1944, prescribing period of limitation for review, by a Commissioner of Central Excise, of any decision or order of any adjudicating authority subordinate to him, is Sub-section (3) of Section 35-E of that Act, which is identically worded as above. The decisions cited by the learned counsel have got to be considered in view of this legal position.
5. In case of M.M. Rubber Co, (supra), the Central Board of Excise & Customs had, by order dated 11.12.1985 under Sub-section (1) of Section 35E of the Central Excise & Salt Act, 1944, reviewed an order of adjudication passed on 28.11.1984 by the Collector of Central Excise, Madras dropping a demand of duty raised on the assessee by the department holding the same to be barred by limitation. The date on which the assessee had received an attested copy of the Collector’s order was 21.12.1984. In the appeal filed with this tribunal pursuant to the Board’s review order, the question arose whether the period of limitation of one year prescribed under Sub-section (3) of Section 35-E for the Board to pass review order under Sub-section (1) in the case should be reckoned with reference to 28.11.84 or 21.12.84. The Tribunal accepted the assessee’s contention that the relevant date for the purpose was 28.11.84, the date on which the adjudicating authority’s order was passed. Accordingly, the Board’s order of review was held to be beyond the period of limitation and the department’s appeal was dismissed as not maintainable. The appeal preferred by the department against the Tribunal’s decision was dismissed by the Supreme Court as per the judgment cited before us by the counsel. The ratio of the Hon’ble Court’s decision is contained in paragraphs 17 & 18 of the judgment which read:
“17. Thus if the intention or design of the statutory provision was to protect the interest of the person adversely affected, by providing a remedy against the order or decision any period of limitation prescribed with reference to invoking such remedy shall be read as commencing from the date of communication of the order. But if it is a limitation for a competent authority to make an order the date of exercise of that power and in the case of exercise of suo motu power over the subordinate authorities’ orders, the date on which such power was exercised by making an order are the relevant dates for determining the limitation. The ratio of this distinction may also be founded on the principle that the Government is bound by the proceedings of its officers but persons affected are not concluded by the decision.
18. Section 35-E comes under the latter category of an authority exercising its own powers under the Act. It is not correct to equate the Board, as contended by Shri Gaurishankar Murthy to one of the two parties to a quasi-judicial proceeding before the Collector and the Board’s right under Section 35-E to the exercise of the right of appeal by an aggrieved assessee from an order passed to its prejudice. The power under Section 35-E is a power of superintendence conferred on a superior authority to ensure that the subordinate officers exercise their powers under the Act correctly and properly. Where a time is limited for the purposes by the statute, such power, as under Section 33A(2) of the Indian Income-tax Act, 1922 referred to in Muthia Chettiar (supra), should be exercised within the specified period from the date of the order sought to be reconsidered. To hold to the contrary would be inequitable and will also introduce uncertainties into the administration of the Act for the following reason. There appears to be no provision in the Act requiring the endorsement, by a Collector, of all orders passed by him to the Board. If there is such a practice in fact or requirement in law. The period of one year from the date of the order is more than adequate to ensure action in appropriate cases particularly in comparison with the much shorter period an assessee has within which to exercise his right of appeal. If, on the other hand, there is no such requirement of practice and the period within which the Board can interfere is left to depend on the off-chance of the Board coming to know of the existence of a particular order at some point of time, however distant, only administrative chaos can result. We are, therefore of the opinion that the period of one year fixed under Sub-section (3) of Section 35E of the Act should be given its literal meaning and so construed the impugned direction of the Board was beyond the period of limitation prescribed therein and therefore invalid and ineffective.”
6. The above ruling was followed by the Tribunal in the cases of Solid Containers and Polycoat Powders (supra). In both these cases, review orders passed by Collector of Central Excise under Section 35E(2) of the Central Excise & Salt Act beyond the period of one year [prescribed under Section 35E(3)] from the dates of orders of subordinate adjudicating officers were held to be invalid and ineffective and relief was granted to the assessees.
7. The provisions of Section 129D of the Customs Act are pari materia with those of Section 35E of the Central Excise Act as rightly pointed out by the counsel. Sub-section (3) of Section 129D, relevant to the instant case, and Sub-section (3) of Section 35E considered by Apex Court in M.M. Rubber Co, (supra) are textually identical. Hence, there is no reason why the Apex Court’s ruling should not be followed in the instant case.
8. The review order passed by the Commissioner of Customs beyond one year from the date (23.7.99) on which the subordinate adjudicating authority had passed its order sanctioning refund to the assessee was not valid in law and consequently the department’s appeal filed in pursuance of the same was not maintainable. To treat the date (1.9.99) of issue of the adjudicating authority’s order as relevant for the purpose of Sub-section (3) of Section 129D, as to lower appellate authority has done in this case, is contrary to the law settled by the Apex Court. Therefore, we set aside the impugned order and allow this appeal.