2004 (9) TMI 175 - AT - Customs

Summary

Issues Involved:

1. Relationship between the appellants and M/s. Caterpillar (Far East) Ltd.
2. Provisional assessment and loading of value.
3. Refund claims and time-bar.
4. Unjust enrichment.
5. Finalization of assessments.

Detailed Analysis:

1. Relationship between the appellants and M/s. Caterpillar (Far East) Ltd.:
The Special Valuation Branch (SVB) suspected that the appellants and M/s. Caterpillar (Far East) Ltd. were "related" persons under their agreement, leading to provisional assessment of all Bills of Entry with a 20% ad hoc loading on the invoiced value.

2. Provisional assessment and loading of value:
The Assistant Collector (SVB) reduced the loading to 8.3% after investigation. The Collector (Appeals) ruled that 8.3% loading applied only before the Customs Valuation Rules, 1988, and transaction value should be accepted thereafter. The Tribunal initially upheld the 8.3% loading for the entire period, but after the Supreme Court's remand, the Tribunal directed finalization based on transaction value, dismissing the department's appeal and allowing the importer's appeal.

3. Refund claims and time-bar:
The appellants filed refund claims post the Tribunal's order. A refund claim for Rs. 1,14,44,338 (238 Bills of Entry, March 1994 to February 1998) was rejected as time-barred. The Commissioner (Appeals) directed reconsideration, allowing the assessee to show the claim was not hit by unjust enrichment. Another refund claim for Rs. 85,48,045 (438 Bills of Entry, 1987-1988 to 1991-1992) was also rejected as time-barred. The Commissioner (Appeals) directed finalization of provisional assessments before any refund claim under Section 27 of the Customs Act. A third claim for Rs. 21,02,459 (440 Bills of Entry, 1986-1987 to 1990-1991) resulted in a partial refund of Rs. 14,91,488, subject to Section 27 requirements.

4. Unjust enrichment:
The appellants contended that extra duty deposits (EDDs) were provisional pre-deposits under Section 129E of the Customs Act, not subject to Section 27 or unjust enrichment. They cited Supreme Court and Tribunal decisions supporting their stance. The SDR countered, referencing the Supreme Court's decision in CCE v. Allied Photographics India Ltd., which held that refund of duty paid under protest attracted unjust enrichment bar.

5. Finalization of assessments:
The Tribunal recognized the provisional nature of the assessments and directed finalization based on transaction value. The original authority's rejection of refund claims as time-barred was found incorrect. The Tribunal ordered finalization of assessments for the relevant periods and allowed refund claims under Section 27, excluding unjust enrichment.

Conclusion:
The Tribunal directed:
- Final assessment of 238 Bills of Entry (March 1994 to February 1998) by the original authority, allowing refund claims within the limitation period under Section 27.
- Finalization of provisional assessments for 438 Bills of Entry (1987-1988 to 1991-1992) as directed by the Commissioner (Appeals), with subsequent refund claims under Section 27.
- For 440 Bills of Entry (1986-1987 to 1990-1991), the assessee to claim refund under Section 27 post-finalization of provisional assessments. For Bills of Entry from 6-4-1994 onwards, finalization by the original authority and subsequent refund claims under Section 27.
- No refund claim to be rejected based on unjust enrichment.

The appeals were disposed of with the impugned orders modified accordingly.