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2024 (3) TMI 1054 - AT - CustomsRefund of export duty paid in excess consequent to the issuance of duty reduction Notification No.62/2007 dated 03.05.2007 - conclusive evidence to discharge the burden of unjust enrichment - whether the incidence of duty has been passed on to the buyer? - HELD THAT - Clause 4 of the Contract dated 26.04.2007 between the buyer and the seller clearly stated that all Indian taxes on cargo will be borne by the seller is not under dispute. The Bank Realization Certificate, invoice, the bill amount in foreign exchange and dispatch amount due to the exporter was less than the FOB value shown in the shipping bill, are also facts that are not disputed. The learned Commissioner (Appeals) in the impugned order relies on the financial records to state that it is not shown as receivables and relying on the Board Circular dated 28.05.2008, without disputing the above facts rejects the refund claim without any justification for rejection. The fact that all the documents have been placed by the appellant justify that the export duty paid by them has not been passed on to the buyer brushing them aside without any reasoning is not sustainable. The seller has borne the incidence of duty. The undertaking by the buyer also is on record which states that the incidence of export duty for the impugned shipment was not passed on to them. In view of the above documents, there are no reason to sustain the impugned order. Appeal allowed.
Issues Involved:
1. Eligibility for refund of export duty. 2. Burden of proof regarding unjust enrichment. Summary: 1. Eligibility for Refund of Export Duty: The appellant, M/s. Muneer Enterprises, claimed a refund of export duty paid in excess due to Notification No.62/2007 dated 03.05.2007, which reduced the duty rate. The original authority verified the contract dated 26.04.2007 and concluded that the appellant had not charged or received any amount over the contracted price, thus holding that the incidence of duty was not passed on to the buyer and sanctioned the refund. 2. Burden of Proof Regarding Unjust Enrichment: The Commissioner (Appeals) did not dispute the facts but found them inconclusive for discharging the burden of unjust enrichment, relying on the Circular dated 28.05.2008, and rejected the refund claim. The appellant argued that the export duty was not recovered from the buyer, supported by the audited balance sheets, Chartered Accountant certificate, and other relevant documents. They cited several judgments to substantiate their claim that the burden of duty had not been passed on to the buyer. Judgment: The Tribunal noted that the primary question was whether the incidence of duty had been passed on to the buyer. It was observed that Clause 4 of the contract clearly stated that all Indian taxes on cargo would be borne by the seller. The Tribunal found that the Bank Realization Certificate, invoice, and other documents supported the appellant's claim that the duty was not passed on to the buyer. The Tribunal criticized the Commissioner (Appeals) for rejecting the refund claim without proper justification and relying on surmises and conjectures. The Tribunal referred to various judgments, including CCE vs. EL.P.EM. Industries and Indian Metals and Ferro Alloys vs. CCE, emphasizing that invoices are the best evidence to determine whether the duty burden has been passed on. It was noted that if invoices do not show any element of duty recovered from customers, it should be assumed that no burden of duty has been passed on. The Tribunal also referred to the Asia Pacific Commodities Ltd. vs. Assistant Commissioner of Customs case, which highlighted that under Incoterms 2000 for FOB shipments, the seller bears all expenses, including customs duties, before the goods are put on board. In conclusion, the Tribunal found that the appellant had borne the incidence of duty and that the Commissioner (Appeals) had erred in rejecting the refund claim. The appeal was allowed with consequential relief as per law. The decisions cited by the Revenue were deemed not applicable to the facts of the present case.
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