2015 (12) TMI 926 - AT - Customs

Denial of refund claim - unjust enrichment - Held that - Sub-section (2) of Section 18 of the Customs Act, 1962 provides when the duty leviable on such goods is assessed finally in accordance with the provisions of this Act, then, in case of goods, cleared for home consumption, the amount paid shall be adjusted against the duty finally assessed and if the amount is paid, the importer or the exporter be entitled to a refund claim as the case may be. It is clear from Section 18 that the appellant is entitled to refund of duty after finalization of the assessments under the said Section. - Commissioner (Appeals) directed to the adjudicating authority to examine the admissibility of the refund as per the prevalent law. In our considered view, the Adjudicating Authority should consider the case laws as relied upon by the Learned Advocate while the passing the order in denove proceedings. In view of the discussions, we do not find any reason to interfere the order of the Commissioner (Appeals). However, as the matter is for the year 1988, we direct the Adjudicating Authority to complete the denove proceedings within 3 months from the date of receipt of this order - Appeal disposed of.

Summary

Issues:
1. Rejection of interest payment on delayed refund.
2. Finalization of assessments under Section 18 of the Customs Act, 1962.
3. Remand of the matter to the Adjudicating Authority for examination of admissibility of interest.

Analysis:

Issue 1: Rejection of interest payment on delayed refund
The appellant imported capital goods and spare parts, cleared under provisional assessment. The Special Valuation Branch finalized the valuation, leading to refund claims. The Tribunal allowed the appeal, stating the claims were not hit by unjust enrichment. However, the Adjudicating Authority rejected interest payment on delayed refunds. The Commissioner (Appeals) remanded the matter to examine interest admissibility for specific orders. The Tribunal found the main contention regarding rejection of interest unsubstantiated, as per Section 18 of the Customs Act, 1962. The Department granted refunds within 3 months of assessment finalization, hence no infirmity in the order.

Issue 2: Finalization of assessments under Section 18 of the Customs Act, 1962
Section 18 mandates duty refund after final assessment. The Department finalized assessment on 21.05.2004, granting refunds within 3 months. The Tribunal upheld this, emphasizing the appellant's entitlement to refunds post-assessment finalization under Section 18. The Department's actions aligned with legal provisions, validating the assessment finalization date and refund timeline.

Issue 3: Remand of the matter to the Adjudicating Authority
The remand was based on the appeal's relation to 2006 and settled legal precedents. The Advocate argued against the remand, citing established case laws. The Tribunal acknowledged the Commissioner (Appeals) directing the Adjudicating Authority to consider prevalent laws and case laws cited by the Advocate in denovo proceedings. While upholding the Commissioner's order, the Tribunal directed the Authority to conclude proceedings within 3 months from the order receipt, ensuring timely resolution.

In conclusion, the Tribunal dismissed the appellant's appeal, affirming the Commissioner (Appeals)'s decision but instructed the Adjudicating Authority to expedite proceedings considering relevant case laws.