1993 (10) TMI 155 - AT - Customs

Summary

Issues Involved:
1. Effectiveness of Notification No. 304/85-Customs, dated 30-9-1985.
2. Consideration of the appeal despite pending Supreme Court cases.
3. Refund claim under Section 25 of the Customs Act, 1962.
4. Unjust enrichment argument.

Detailed Analysis:

1. Effectiveness of Notification No. 304/85-Customs, dated 30-9-1985:
The core issue revolves around when Notification No. 304/85-Customs, dated 30-9-1985, became effective. The appellants argued that the notification was made public on 2-11-1985, as evidenced by a letter from the Assistant Controller (Periodicals) in the Department of Publications, Ministry of Works and Housing, Government of India. The department did not provide any evidence to contradict this claim. The Tribunal, referencing various judgments, including those by the Bombay High Court and the Supreme Court, concluded that the notification became effective only when it was made available to the public, i.e., on 2-11-1985. Therefore, the differential duty collected for clearances made between 24-10-1985 to 31-10-1985 was deemed unauthorized, and the duty collected should be refunded.

2. Consideration of the appeal despite pending Supreme Court cases:
The Tribunal addressed the respondent's request to defer the decision until the Supreme Court ruled on similar issues. The Tribunal noted that the Supreme Court's existing judgments remain good law unless overruled. It emphasized that merely accepting appeals for hearing does not justify suspending or postponing decisions on identical issues. The Tribunal cited the Supreme Court's stance in Union of India v. Kamlakshi Finance Corporation and decisions from the Madras High Court, asserting that appeals should not be kept in abeyance pending Supreme Court decisions on similar issues.

3. Refund claim under Section 25 of the Customs Act, 1962:
Section 25 of the Customs Act empowers the Central Government to grant exemptions via notifications published in the Official Gazette. The Tribunal highlighted that the publication of such notifications is mandatory and becomes effective only when made available to the public. The Tribunal referenced multiple judgments, including those from the Bombay, Madras, and Calcutta High Courts, which consistently held that a notification becomes effective only when the Gazette is made available for public sale. The Tribunal concluded that Notification No. 304/85, dated 30-9-1985, became effective on 2-11-1985, the date it was made available to the public. Consequently, the differential duty collected for clearances made before this date was unauthorized, and the refund claim was valid.

4. Unjust enrichment argument:
The respondent argued that granting the refund would result in unjust enrichment, as the additional duty burden would have been passed on to the buyers. The Tribunal acknowledged this argument, referencing the Supreme Court's decision in Union of India v. ITC Ltd., which allows for such arguments to be raised at the appeal stage. The Tribunal noted that the factual position regarding whether the additional duty burden was passed on to the buyers was not clear. Therefore, it kept the issue open, allowing for further examination in accordance with the amended Section 27 of the Customs Act, without expressing a final opinion on the appellants' eligibility for refund.

Conclusion:
The Tribunal set aside the order rejecting the refund of differential customs duty and directed that the refund be sanctioned according to law. The notification was deemed effective from 2-11-1985, and the differential duty collected before this date was unauthorized. The issue of unjust enrichment was left open for further examination.