2006 (6) TMI 396 - AT - Customs

Summary

Issues:
- Entertaining refund claim without challenging assessment order
- Interpretation of Section 27 of the Customs Act, 1962
- Applicability of previous judgments on refund claims

Entertaining refund claim without challenging assessment order:
The case involved two appeals challenging the rejection of a refund claim under Section 27 of the Customs Act, 1962, without challenging the assessment order. The Commissioner (Appeals) upheld the rejection based on the non-challenge of the assessment order by the appellant. The appellant argued that the refund application alone should suffice, citing previous judgments. The department representative supported the rejection, referring to relevant Supreme Court decisions. The Tribunal emphasized that a refund claim cannot be filed without reviewing or modifying the assessment order. The Tribunal rejected the argument that a refund claim could be made without challenging the assessment order, citing the precedence set by previous judgments.

Interpretation of Section 27 of the Customs Act, 1962:
The Tribunal referred to Section 27 of the Customs Act, 1962, which allows a refund claim by a party who paid duty based on an assessment order. The appellant contended that a claim for refund could be made without appealing the assessment order, arguing that the correctness of the assessment could be reviewed during the refund claim process. However, the Tribunal emphasized that duty is payable as per the assessment order until it is reviewed or modified through appeal. The Tribunal clarified that a refund claim does not equate to an appeal proceeding and cannot override an assessment order.

Applicability of previous judgments on refund claims:
The appellant relied on previous judgments like Faxtel Systems (India) Pvt. Ltd. and Albert David Ltd. to support the argument that a refund application under Section 27 could be maintained without separately challenging the bill of entry assessment. However, the Tribunal reiterated the precedence set by the Supreme Court in Flock (India) Pvt. Ltd. and Priya Blue Industries Ltd., emphasizing that duty remains payable as per the assessment order until reviewed or modified. The Tribunal dismissed the appeal, noting that the challenge was filed beyond the condonable delay period.

In conclusion, the Tribunal upheld the rejection of the refund claim, emphasizing that a refund claim cannot be entertained without challenging the assessment order, as per the provisions of Section 27 of the Customs Act, 1962, and established legal precedents.