2023 (10) TMI 1460 - AT - Customs

Refund claim to be the amount excess paid based on the finalisation of the provisional assessments - HELD THAT - The matter is remanded to the original authority only to the limited extent of verification of the documents like BOE, TR-6 challans, finalisation of PD bond, etc., which appears to be have been submitted by the appellant to the assessment group and the appellant will also cooperate in providing all the documents wherever necessary. A reasonable opportunity of hearing may be granted to the appellant before the issue of refund is finalised.

Summary

Issues Involved:

1. Eligibility for refund based on the finalization of provisional assessments.
2. Non-submission of required documents for refund processing.
3. Applicability of the doctrine of unjust enrichment to the refund claim.

Detailed Analysis:

1. Eligibility for Refund:

The appellant filed a refund claim on 5.8.2015 for an excess amount paid, based on the finalization of provisional assessments as per Order-in-Original No.694/2014 dated 31.12.2014. The Commissioner (Appeals) initially rejected the refund claim, referencing Order-in-Appeal No.260/2016 dated 31.3.2016, which set aside the original order. However, this Tribunal, in its Final Order No.20870/2023 dated 18.5.2023, set aside the Order-in-Appeal No.260/2016, thereby reinstating the appellant's eligibility for a refund on merits. The Tribunal confirmed that the appellant is entitled to the refund of the excess amount paid for the period April 2002 to March 2003, based on the original order.

2. Non-Submission of Documents:

The Commissioner (Appeals) also rejected the refund claim due to the alleged non-submission of essential documents such as Bills of Entry (BOE), TR-6 challans, and finalization of the PD bond. The appellant contended that these documents were submitted to the assessment group on 14.10.2015. The Tribunal noted that the appellant had indeed communicated the submission of these documents to the department and thus remanded the matter to the original authority for verification of the submitted documents. The Tribunal emphasized that the appellant should be given a reasonable opportunity to provide any additional documents required for the refund process.

3. Doctrine of Unjust Enrichment:

The issue of unjust enrichment was also raised, questioning whether the appellant had passed on the duty incidence to another party, which would negate their refund claim. The appellant argued that the doctrine of unjust enrichment, as per Clause (5) to Section 18 of the Customs Act, 1962, does not apply to their case since the relevant amendment took effect from 13.7.2006, which is after the period in question. The Tribunal agreed with the appellant, citing precedents from cases such as M/s. Mangalore Refinery and Petrochemicals Ltd. and Indian Oil Corporation, which established that prior to the 2006 amendment, the doctrine of unjust enrichment was not applicable to refund claims under Section 18 of the Customs Act. Consequently, the Tribunal concluded that the refund claim should not be denied on the grounds of unjust enrichment for the period before the amendment.

Conclusion:

The Tribunal allowed the appeal by way of remand, directing the original authority to verify the necessary documents submitted by the appellant and to provide a reasonable opportunity for the appellant to present any further documentation if required. The Tribunal's decision effectively reinstated the appellant's eligibility for a refund, dismissing the applicability of unjust enrichment for the period prior to the 2006 amendment. The operative portion of the order was pronounced in open court.