Circular No. 853/11/2007-CX
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs
New Delhi dated the August 13, 2007
All Chief Commissioners of Customs & Central Excise
All Chief Commissioners of Central Excise
All Commissioners of Central Excise
All Commissioners of Customs & Central Excise
Sub: Refund of excise duty paid on purchase of excisable goods by diplomatic missions.
The undersigned is directed to refer to the BoardĒs circular No. 621/12/2002 dated 21.02.2002 on the above subject. Para 8 of this circular provides the time limit for filing refund claim to be one year from the date of purchase of the goods by the diplomatic mission or consular office, as per the provisions of section 11B (1)of the Central Excise Act,1944 read with explanation (B)(e). As per the prescribed procedure, such refund claims are received initially by the Ministry of External Affairs (MEA), and are forwarded with required certification to the offices of the jurisdictional Assistant/ Deputy Commissioner of Central Excise. The claim is processed and refund cheques are sent to MEA for onward transmission to the diplomatic missions/posts. However, certain instances were brought to the notice of the Board, wherein even though refund claims were submitted to the MEA by the diplomatic missions within one year, but the claims became time-barred, as there was a delay in forwarding the said claims to the jurisdictional Assistant/ Deputy Commissioner of Central Excise.
2. In order to avoid recurrence of such instances, Board has devised a new procedure for processing of these claims. The revised procedure is that the refund claims would continue to be filed by the foreign missions with the MEA. However, vide notification No. 30/2007-CE(NT) dated 30.07.2007, the officer receiving the said claims has been designated as Assistant/ Deputy Commissioner of Central Excise for the limited purposes of receiving the claims under section 11B of the Act. It would mean that the time limit of one year of filing refund claim would be the date of filing the claim with the authorized officer of MEA. This would eliminate the issue relating to expiry of the statutory limit of one year by the time the claim is received by the Assistant/ Deputy Commissioner of Central Excise.
3. Further, a refund claim is required to be sanctioned within three months of receipt of claim and in case of delay in payment of refund beyond 90 days, interest is required to be paid by the department under section 11BB of the Act. As per the revised procedure, the statutory time limit of 3 months for sanction of refund (beyond which interest is payable) would start from the date of receipt of copy of refund application by the MEA. However, in order to ensure that the jurisdictional central excise officers have sufficient time to process/verify the claim, a time limit of 30 days has been fixed for MEA to forward such refund claims to the concerned Assistant/ Deputy Commissioner of Central Excise along with their recommendation. In case, there is delay in forwarding of such applications by the MEA beyond 30 days, which in turn results in the sanction of refund claim beyond 3 months, then MEA would have to bear the incidence of interest payable to the foreign missions in terms of section 11BB of the Central Excise Act. The interest payable by the MEA would be limited to the number of days beyond the initial thirty days, taken by MEA to forward the said claim to the jurisdictional AC/DC. The procedure for payment of such interest by the MEA is being worked out in consultation with the Pr. CCA, CBEC.
4. The protocol Division of the MEA is also being separately informed about the revised procedure.
5. The field formations may be suitably instructed.
6. Hindi version of the circular will follow.
Under Secretary to the Government of India