2018 (12) TMI 799 - AT - Customs

Refund claim - Reduction of freight - refund rejected solely on the argument that the appellants had resorted to self-assessment procedure for payment of Customs Duty on imported Rock Phosphate and the impugned Bills of Entry including the declaration made there in respect of such goods - appellant have not challenged the same - Held that - Tribunal in the case of Commissioner of Customs (Export) New Delhi Vs. Lalit Kumar 2017 (1) TMI 7 - CESTAT NEW DELHI has held that since the Bill of Entry was assessed by the Customs Department and the assessed duty was paid by the respondent, it cannot be said that the duty was paid by the respondent in pursuance of an order of assessment. Appeal allowed - decided in favor of appellant.

Issues Involved:
1. Rejection of refund claims based on self-assessment procedure.
2. Applicability of the Supreme Court decision in Priya Blue Industries Ltd. vs. Commissioner.
3. Consideration of the Tribunal's decision in Commissioner of Customs (Export) New Delhi vs. Lalit Kumar.
4. Interpretation of Section 27 of the Customs Act, 1962 regarding refund claims.

Detailed Analysis:

1. Rejection of Refund Claims Based on Self-Assessment Procedure:
The appellants, manufacturers of fertilizer products, imported Rock Phosphates from Jordan and filed claims for a refund of customs duty based on changes in freight rates and rebates due to higher moisture and silica content. The Commissioner (Appeals) rejected these claims, arguing that the appellants had resorted to self-assessment for customs duty payment, and the declarations in the Bills of Entry were finalized through the RMS in the EDI system, which the appellants did not challenge.

2. Applicability of the Supreme Court Decision in Priya Blue Industries Ltd. vs. Commissioner:
The lower authorities referenced the Supreme Court's decision in Priya Blue Industries Ltd. vs. Commissioner, which held that as long as the order of assessment stands, duty is payable as per that order, and a refund claim is not an appeal proceeding. However, the Tribunal found that this case was distinguishable. The duty in Priya Blue was paid pursuant to an assessment order, whereas, in the present case, the appellants were not aggrieved by the assessment order as it was based on their own declarations.

3. Consideration of the Tribunal's Decision in Commissioner of Customs (Export) New Delhi vs. Lalit Kumar:
The Tribunal cited its decision in Commissioner of Customs (Export) New Delhi vs. Lalit Kumar, where it was held that the cause of action for filing an appeal arises from the decision of the adjudicating authority, not from the date of assessment of the Bill of Entry. The Tribunal noted that the refund claim was maintainable under Section 27 of the Customs Act, as the duty was borne by the importer, not paid pursuant to an assessment order.

4. Interpretation of Section 27 of the Customs Act, 1962 Regarding Refund Claims:
Section 27 provides the modalities for claiming a refund of customs duty, allowing claims for duty paid in pursuance of an assessment order or borne by the importer. The Tribunal found that the appellants' case fell under the latter category. The Tribunal referenced the Delhi High Court's decision in Aman Medical Products Ltd. vs. Commissioner of Customs, which held that duty borne by the importer qualifies for a refund under Section 27, even if no appeal was filed against the assessed Bill of Entry.

Conclusion:
The Tribunal concluded that the lower authorities erred in rejecting the refund claims based on the self-assessment procedure. The Tribunal set aside the impugned orders, allowing the appeals filed by the appellants. The Tribunal emphasized that the refund claims were maintainable under Section 27 of the Customs Act, and the non-filing of an appeal against the assessed Bill of Entry did not preclude the appellants from claiming a refund.

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