2003 (9) TMI 441 - AT - Central Excise

Summary

Issues:
1. Whether the application for refund of duty paid under protest can be denied on the ground of unjust enrichment.

Analysis:
The appeal raised the issue of whether the appellant's application for refund of duty paid under protest could be denied based on the principle of unjust enrichment. The Commissioner of Central Excise (Appeals) had previously ordered that the appellant was entitled to a refund of excess duty paid, considering the appellant's engagement in ship breaking. The Commissioner directed the refund based on the revised value of the vessel, specifying the computation of various duties. The appellant initially sought a refund of Rs. 44,75,044, later reduced to Rs. 7,77,785. However, the refund claim was rejected by the original authority due to the lack of evidence proving that the duty burden was not passed on to the customer. On appeal, this rejection was upheld.

The appellant contended that the duty was paid under protest, citing the decision of the Supreme Court in Sinkhai Synthetics and Chemicals v. CCE. The appellant argued that being a protest payment, the refund should not be subject to the doctrine of unjust enrichment. The appellant provided evidence, including a letter addressed to the Deputy Commissioner, showing the payment of Customs duty under protest. The Tribunal noted the appellant's compliance with the protest requirement and the absence of evidence contradicting the protest payment claim.

Considering the appellant's payment under protest and the absence of evidence to the contrary, the Tribunal accepted the appellant's argument in line with the Supreme Court decision in Sinkhai Synthetics. Consequently, the Tribunal set aside the previous order and allowed the appeal, directing the respondent to refund the excess duty within 10 weeks from the date of the order.