2016 (2) TMI 140 - AT - Customs

Refund - unjust enrichment - in the relevant invoices, issued to the customers higher rate of duty has been mentioned - Chartered accountant in the statement dated 14/02/2007 recorded under section 108 of the Customs Act , 1962 stated that he had examined the documents on random basis - Held that - As has been stated earlier the lower authorities have noted that the appellant could not establish that at the lower levels. We however take note of the appellant s contention that it is in a position to give evidence to establish this fact even now. - Appeal allowed by way of remand - Matter remanded back.

Summary

Issues:
1. Refund of duty paid under protest
2. Burden of proof regarding passing on duty to customers
3. Remand for re-consideration of refund claim

Refund of duty paid under protest:
The appeal was filed against an order upholding the rejection of refund claims amounting to specific sums. The appellant contested the non-payment of a significant amount, arguing that the duty was paid under protest and not passed on to customers. The advocate asserted readiness to provide evidence to support this claim.

Burden of proof regarding passing on duty to customers:
The tribunal considered the contentions and observed that the burden lay on the appellant to prove that the higher duty paid was not transferred to customers. The invoices indicated a higher duty rate, supporting the authorities' position. The tribunal rejected the argument that paying duty under protest absolved the appellant from passing on the burden, emphasizing that invoices showing higher duty rates contradicted this claim.

Remand for re-consideration of refund claim:
While acknowledging the lower authorities' findings, the tribunal noted the appellant's assertion of being able to provide additional evidence. Consequently, the appeal was allowed for remand to the primary adjudicating authority. The appellant was granted an opportunity to establish that the duty burden was not shifted to customers, necessitating a reevaluation of the refund claim.

This judgment underscores the importance of proving non-transfer of duty burden to customers, even when duty is paid under protest. The decision for remand highlights the significance of providing substantial evidence to support refund claims, ensuring a fair opportunity for the appellant to substantiate their position.