2004 (7) TMI 473 - AT - Customs

Summary

Issues:
1. Time-barred refund claim.
2. Payment of duty under protest.
3. Admissibility of refund.

Issue 1: Time-barred refund claim
The appeal by the Revenue was against the Commissioner of Customs (Appeals) order, contending that the refund claim by the assessee was not time-barred. The Deputy Commissioner had rejected the refund claim as time-barred. The Revenue argued that the duty payment by the assessee was not explicitly made 'under protest,' and thus, the refund claim filed after about 19 months from the date of payment was barred by limitation under Section 27 of the Customs Act, 1962. However, the Counsel for the respondents referred to the Jt. DGFT proceedings, stating that the duty payment was made pursuant to the Jt. DGFT's advice and not voluntarily by the assessee. The Counsel argued that this constituted a payment 'under protest,' as correctly held by the lower appellate authority. Upon examination, the Tribunal accepted this argument, emphasizing the payment was not voluntary, leading to the conclusion that the refund claim was not time-barred.

Issue 2: Payment of duty under protest
The payment of duty in question was related to raw material imported under the DEEC Scheme against an Advance Licence. The Jt. DGFT advised the respondents to either make up the shortfall in export obligation or pay the customs duty. The respondents chose to pay the duty on 7-6-2000 following the Jt. DGFT's direction, which was acknowledged by the Jt. DGFT. Subsequently, the Jt. DGFT informed the Commissioner of Customs that the respondents had fulfilled their export obligation. The Tribunal noted that the payment was made by the respondents based on the Jt. DGFT's advice, indicating it was made 'under protest.' This understanding was crucial in determining the admissibility of the refund claim.

Issue 3: Admissibility of refund
The Tribunal upheld the decision of the Commissioner (Appeals) that the refund claim was admissible to the respondents, subject to verification of unjust enrichment by the original authority. The Tribunal emphasized that the payment of duty was not voluntary but made under the direction of the Jt. DGFT, qualifying it as a payment 'under protest.' Therefore, the Tribunal concluded that the refund was rightfully allowed to the respondents based on a correct understanding of the facts of the case. Consequently, the Revenue's appeal was rejected, affirming the admissibility of the refund claim to the respondents.