2018 (2) TMI 337 - AT - Customs

Refund claim - finalization of provisional assessment - Held that - issue has been settled in appellant s own case Mangalore Refinery And Petrochemicals Ltd. Versus Commissioner of Customs, Mangalore 2015 (9) TMI 245 - SUPREME COURT , where it was held that the quantity of crude oil actually received into a shore tank in a port in India should be the basis for payment of Customs duty. Consequential action, in accordance with this declaration of law, be carried out by the Customs authorities in accordance with law - the impugned order is liable to be set aside and the matter is required to be remanded back to the original authority for fresh adjudication - appeal allowed by way of remand.

Summary

Issues:
1. Appropriation of refund against demand made under separate Orders-in-Original.
2. Double collection of duty by Customs Authorities.
3. Validity of demand outstanding and confirmed demand.
4. Order of appropriation/recovery versus order of assessment.
5. Directions issued by the Hon'ble Apex Court in the appellant's case.
6. Settlement of matter by the Apex Court and remand for fresh adjudication.

Analysis:
1. The appeal challenged the impugned order upholding the Order-in-Original and rejecting the appellant's appeal. The appellant, a Petroleum Refinery, imported crude oil under various bond entries for provisional assessment. Upon finalization, a refund was due as the duty paid provisionally exceeded the final duty. The adjudicating authority sanctioned a refund but only appropriated it against demands from other Orders-in-Original, which were under appeal. The genesis of the present proceedings was an appropriation of &8377; 61,60,758 against an Order-in-Original re-determining CIF value and demanding additional duty.

2. The appellant argued that the appropriation resulted in double duty collection, as the enhanced license value was debited in the DEEC passbook, constituting an impermissible double collection of duty. The appellant contended that duty cannot be collected twice on the same liability, especially when the demand outstanding was not confirmed due to ongoing appeals. The appellant emphasized that the order of appropriation/recovery should not override the order of assessment, which was under appeal before the First Appellate Authority and the Tribunal.

3. The learned counsel highlighted the directions issued by the Hon'ble Apex Court in the appellant's favor, setting aside the Tribunal's judgment and declaring that Customs duty should be based on the quantity of crude oil received in an Indian port. The Tribunal, considering the Apex Court's judgment, found the appropriation untenable and set aside the impugned order, remanding the case for fresh adjudication as directed by the Apex Court. The Tribunal emphasized the need for de novo assessment and compliance with principles of natural justice.

4. The Tribunal's decision was based on the settlement of the matter by the Apex Court, which necessitated a fresh adjudication of the assessment finalized under Order-in-Original No. 113/2006. The Tribunal allowed the appeal by remand, emphasizing the importance of adhering to the Apex Court's directives and ensuring a fair opportunity for the appellant to present supporting documents during the fresh adjudication process.