2004 (3) TMI 229 - AT - Customs

Entitlement to refunds - Unjust enrichment - loading of declared value of imported goods - non-mention of duty element in invoices - burden of proof on passing of duty burden to consumer - Applicability of Section 28D - HELD THAT - It was for the Department to have brought on record evidence to prove the case of unjust enrichment burden passed on. The sale price and costing of the goods as submitted by the appellant that has not been questioned by both the authorities below. Therefore non-filing of IT returns and of Balancesheet to the Commissioner (Appeals) are issued not germane and are irrelevant for considering the question of unjust enrichment the sale of imported goods been made by the importer. The cost of goods is a pure question of fact and profit and loss are to be determined consequently to the cost of the goods of import duties, especially on enhanced value would be a important component of costs. Since the presumption raised by Sec. 28D of the Customs Act, 1962 is a rebuttable presumption of law and not conclusive merely because the documents of sale are not as per the provision of Section 28 DR it can't be presumed that whatever the appellants has recovered from his customer was first duty of customs and there-after his own costs. Vide Final Order No. A/1198/2003-NB (SM), dated 3-10-2003 in the case of Mohan Sales (India) 2003 (10) TMI 324 - CESTAT, NEW DELHI , the Tribunal set aside the finding of unjust enrichment and orders of credit to welfare fund in a case where Revenues conclusion that it is not possible to sell goods on losses was set aside after accepting the contention that presumption in law of having passed the duty burden is a rebuttable presumption and since invoice and certificate was not being disputed. The refunds were ordered as order directing the same to be credited to Consumer Welfare Fund have not sustained. Following this decision and finding the facts to be similar this appeal is also to be allowed since nothing contrary to this decision of Tribunal has been shown. In view of the finding orders arrived at by the lower authorities are set aside and appeal allowed.

Summary

Issues Involved:
The issues involved in the judgment are the rejection and loading of declared value of imported goods, entitlement to refunds, unjust enrichment, non-mention of duty element in invoices, burden of proof on passing of duty burden to consumer, and the applicability of Section 28D of the Customs Act, 1962.

Rejection of Declared Value and Refunds:
The appellant imported electric brick games at Chennai Air Cargo Complex with a declared value which was rejected and loaded. The Commissioner (Appeals) set aside the order of enhancement of value, leading to the appellant being entitled to refunds.

Unjust Enrichment and Burden of Proof:
The Deputy Commissioner called for documents to rule out unjust enrichment. The Deputy Commissioner held that the duty amount had been passed on to the buyers, leading to a refund order to be credited to the consumer welfare fund. However, the Commissioner (Appeals) found errors in this decision, stating that the burden of proof on passing the duty burden to the consumer was not conclusively established. The Commissioner (Appeals) highlighted that the non-mention of the duty element separately in the invoice does not necessarily bar the claim for refund, as the presumption of duty burden being passed on is rebuttable.

Authenticity of Documents and Burden of Proof:
After considering the submissions, it was found that the Commissioner (Appeals) erred in upholding the bar of unjust enrichment without sufficient evidence. The authenticity of the sale invoices was not in question, and the burden of proof on unjust enrichment was on the Department. The non-filing of certain documents like IT returns and balance sheets was deemed irrelevant in determining unjust enrichment. The presumption under Section 28D of the Customs Act, 1962 is rebuttable, and the burden of proof lies on the Department to establish unjust enrichment.

Precedent and Refunds:
Referring to a previous Tribunal decision, it was noted that the presumption of having passed the duty burden is rebuttable. Following this precedent, the appeal was allowed, setting aside the lower authorities' orders and allowing for refunds.

In conclusion, the judgment addressed issues related to the rejection of declared value, entitlement to refunds, unjust enrichment, burden of proof on passing duty burden to consumers, and the applicability of legal provisions in determining refund claims.