2004 (10) TMI 222 - AT - Customs

Adjudication - Refund - Unjust enrichment - manufacture of transformers from Sweden - rate of exchange calculated on the basis of Swiss Franc instead of Swedish Krones - duty paid in excess on account of clerical errors - HELD THAT - The learned Advocate has rightly emphasised that the fact of admissibility of refund claim has attained finality as the same has not been challenged by the Department in Appeal. It is, therefore, not open to the Commissioner (Appeals) to reject the refund claims on the ground that the provisions of Section 154 were not complied with. The judgment in the case of Priya Blue Industries Ltd. 2004 (9) TMI 105 - SUPREME COURT is also not applicable as Section 154 of the Customs Act, independent of Appeal, provides for correction of clerical or arithmetical mistakes in any decision or order by an officer of Customs. The Bombay High Court has held in Keshari Steels, 1997 (12) TMI 643 - SC ORDER , that once the clerical or arithmetic mistake is corrected, the assessee is entitled to have refund of the said amount which is paid due to an arithmetical mistake . The SLP preferred by Revenue has also been dismissed by the Supreme Court. Thus the refunds of excess amount of duty is admissible. Applicability of bar of unjust enrichment, we find that the Appellants have contended that the excess duty paid by them is appearing as sundry recoverable in their books of accounts which has also been certified by the Chartered Accountants. These submissions of the Appellants have not been considered by the Adjudicating Authority in the Order-in-Appeal at all. We, therefore, set aside the impugned order and remand both the appeals to the jurisdictional Adjudicating Authority for examining as to whether bar of unjust enrichment is applicable and decide the matters afresh after affording a reasonable opportunity of hearing to the Appellants. Both the appeals are thus, allowed by way of remand.

Summary

Issues involved: The issue involved in these two appeals is whether the refund of duty claimed by M/s. ABB Ltd. is to be sanctioned to them.

Details of the Judgment:

Issue 1 - Refund of duty claimed by M/s. ABB Ltd.:
The Appellants imported certain parts and components for use in the manufacture of transformers from Sweden. They paid duty in excess due to a clerical error in calculating the exchange rate. The Adjudicating Authority directed the refund amount to be credited to the Consumer Welfare Fund. The Commissioner (Appeals) rejected their appeals on the grounds of no correction under Section 154 of the Customs Act or filing of an Appeal. The Appellants argued that the excess duty paid was not passed on to customers, as evidenced by a Chartered Accountant's Certificate and Balance Sheet. They cited a relevant case law and emphasized that the excess duty refund claim had not been challenged by the Department in Appeal. The Tribunal agreed that the refunds of the excess duty amount were admissible as per Section 154 of the Customs Act, independent of Appeal.

Issue 2 - Applicability of bar of unjust enrichment:
The Departmental Representative argued that the Appellants cannot claim a refund as they did not challenge the assessment in Appeal, and the assessment had attained finality. He also contended that the bar of unjust enrichment would apply to the refund claim. However, the Tribunal found that the Appellants had shown the excess duty paid as recoverable in their books of accounts, certified by Chartered Accountants. This aspect was not considered by the Adjudicating Authority. Therefore, the Tribunal set aside the impugned order and remanded the appeals for further examination on the applicability of unjust enrichment.

In conclusion, both appeals were allowed by way of remand for a fresh examination on the applicability of unjust enrichment and a decision on the refund claims after providing a reasonable opportunity of hearing to the Appellants.