2010 (6) TMI 422 - AT - Customs

Refund limitation - appellant is claiming the refund of the 4% Addl. Duty; paid which was not leviable on the appellant - Section 27 of the Act applies only when the refund that is being sought is of customs duty otherwise leviable under the Act. In this case I find that the appellant is claiming the refund of the 4% Addl. Duty; paid which was not leviable on the appellant. - refund claim has been dismissed being time-barred and there is no findings has been given on merits - remand back the matter to the original adjudicating authority

Summary

Issues:
- Appeal against the order holding the refund claim as time-barred under Section 27(1)(b) of the Customs Act, 1962.
- Interpretation of the provision of Section 27 of the Act in relation to the refund of customs duty.
- Applicability of time-bar provisions when the duty paid was not leviable on the appellant.

Analysis:
The appellant filed an appeal against the order of the authorities below, which held the refund claim as time-barred under Section 27(1)(b) of the Customs Act, 1962. The appellant had paid duty on a Bill of Entry dated 17-5-2006, realizing later that 4% additional duty was not chargeable due to the import being under the EPCG Scheme. The adjudicating authority rejected the refund claim as time-barred, a decision upheld by the Commissioner (Appeals). The appellant argued that the duty paid was not payable by them, and thus, the time-bar provision should not apply. Citing the case of Hind Agro Industries Ltd. v. CC, the appellant contended that the provision of Section 27 applies only when the refund sought is of customs duty otherwise leviable under the Act.

The appellant's representative relied on the judgment of the Hon'ble High Court of Delhi in Hind Agro Industries Ltd. v. CC, emphasizing that Section 27 of the Act applies when the refund sought is of customs duty otherwise leviable under the Act. In this case, the appellant sought a refund of the 4% additional duty paid, which was not leviable on them. Therefore, the provision of Section 27, requiring the refund claim to be filed within six months of the assessment of the Bill of Entry, was deemed inapplicable to the appellant's situation. Consequently, the impugned order holding the refund claim as time-barred was set aside, and the matter was remanded back to the original adjudicating authority for a decision on the refund claim based on merit, with a directive to provide an opportunity for the appellant to present their case.

In conclusion, the Tribunal found that the appellant's refund claim was not time-barred under Section 27 of the Customs Act, 1962, as the duty paid was not leviable on them. The decision emphasized the importance of considering the specific circumstances of each case when applying statutory provisions related to refund claims, ensuring that claimants are not unduly penalized for duties paid erroneously.