2013 (8) TMI 653 - AT - Customs

Refund claim - Assesse had imported bales of Scoured New Zealand Wool -The goods were assessed to duty by the Customs Department and the Assesse cleared the goods on payment of Additional Customs Duty Assesse filed a Refund Claim on the ground that the imported goods were exempt from payment of Additional Customs Duty in terms of exemption Notification No.20/2006-Cus - Held that - Order passed by the Commissioner (Appeals) to be sustained relying upon CCE, Kanpur vs. Flock (India) Pvt. Ltd. 2000 (8) TMI 88 - SUPREME COURT OF INDIA - in absence of an appeal challenging the assessment order, no refund application is maintainable for excess amount of duty, if any, paid. It is also observed that if an assessee fails to challenge an order of assessment issued by proper authorities, but resorts to file a refund claim for relief, then such approach would disturb the very scheme of the statute and would create uncertainty in the process of levy and collection of duty Decided against assesse.

Summary

Issues:
1. Refund claim of Additional Customs Duty based on exemption Notification
2. Rejection of refund claim by Lower Authority and Commissioner (Appeals)
3. Applicability of judgements by Hon'ble Supreme Court and High Courts
4. Challenge of Assessment Order and filing of appeal
5. Maintainability of refund claim without challenging Assessment Order
6. Interpretation of Section 27 of the Customs Act, 1962
7. Distinction between refund claim and appeal proceedings
8. Applicability of judgements in similar cases
9. Impact of Special Leave Petition (SLP) admission on lower court judgements

Analysis:
The case involved an Appeal against the rejection of a Refund Claim of Additional Customs Duty by the Lower Authority and Commissioner (Appeals). The Appellant imported goods claiming exemption under Notification No.20/2006-Cus but paid duty initially. The Lower Authority rejected the Refund Claim citing failure to challenge the Assessment Order. The Commissioner (Appeals) upheld this decision based on judgements by the Hon'ble Supreme Court. The Appellant argued that the Refund Claim was valid under Section 27 of the Customs Act, 1962, and challenged the applicability of the judgements. The Revenue contended that the Refund Claim was not maintainable without challenging the Assessment Order through an appeal.

The Tribunal examined the case law, including the Flock India and Priya Blue Industries cases by the Hon'ble Supreme Court, emphasizing the importance of challenging Assessment Orders before seeking refunds. The Tribunal cited the principle that refund claims and appeals are distinct proceedings, with the latter being the appropriate recourse for disputing assessments. The Tribunal distinguished the Bansal Alloys case from the present case, where excess duty was paid due to quantity discrepancies. The Tribunal also noted the impact of an SLP admission on lower court judgements, following the principle of law laid down in the West Coast Paper Mills case.

Ultimately, the Tribunal dismissed the Appeal, agreeing with the Commissioner (Appeals) that the Refund Claim was not maintainable without challenging the Assessment Order. The decision was based on the established legal principles regarding the interplay between refund claims and appeals, as outlined in the relevant case law. The Tribunal's ruling highlighted the necessity of following the prescribed legal procedures, including challenging Assessment Orders through appeals before seeking refunds, to maintain the integrity of the statutory framework governing customs duties.