2010 (12) TMI 80 - AT - Customs

Refund of SAD - Conditions of notification no. 102/2007 - Refund claim was rejected by the department on the ground of unjust enrichment - Held that - As the appellants have obtained a certificate from Chartered Accountant confirming that the duty liability of SAD has not been passed on the buyers by the appellants, the same is sufficient as per the Boards circular no. 18/10 Cus dated 8.7.2010, the discharge the liability of bar of unjust enrichment and the bar of unjust enrichment is not applicable to the case of the appellants. Accordingly, the appellants are entitled for refund claim.

Summary

Issues:
- Appeal against denial of refund claim of SAD due to unjust enrichment.

Analysis:
The appellants imported goods in November 2007 and subsequently sold them between April 2008 and October 2008, charging ST/VAT. They filed a refund claim for the SAD paid by them under Notification 102/07 dated 14.9.2007. However, the lower authorities rejected the claim citing unjust enrichment. The appellants appealed this decision before the Tribunal.

The consultant for the appellants argued that as per circular 18/10 dated 8.7.2010, they were required to produce a Chartered Accountant certificate to prove they did not pass on the duty liability to buyers, which they had submitted to the adjudicating authority. The circular, binding on department officials, entitled the appellants to the refund claim. On the other hand, the Departmental Representative contended that the lower authorities correctly found the appellants failed to discharge the bar of unjust enrichment.

Upon examination, the Tribunal found that the key issue was whether the bar of unjust enrichment applied to the case, considering the refund claim for SAD paid during import when goods were later sold with VAT. The appellants presented a Chartered Accountant certificate confirming they did not pass on the duty liability to buyers. Referring to Circular no. 18/10 Cus dated 8.7.2010, the Tribunal held that this certificate was sufficient to discharge the bar of unjust enrichment, making the appellants eligible for the refund claim. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief.