2012 (10) TMI 830 - AT - Customs

Refund claim benefit of Notification No. 21/2002-Cus. Held that - There is no contest or lis between the appellant and the department at the time of clearance of the goods - payment of higher rate of duty by the appellant is by way of inadvertent mistake without taking the benefit of notification - benefit of said notification, was available to the importer - it is clear case of payment of higher duty due to ignorance - appellants are entitled to refund of excess duty paid by them

Summary

Issues: Refund claim based on payment of higher basic customs duty than required; Challenge of refund claim due to non-challenge of assessment order by importer.

Analysis:
The case involved an appellant who imported electrolytic Tinplate sheets for use in their factory, filed a bill of entry paying a 10% basic customs duty, and later sought a refund claiming they should have paid only 5% based on a customs notification. The Assistant Commissioner verified and sanctioned a refund of Rs. 85,584, considering Modvat credit. The Revenue appealed this decision before the Commissioner (Appeals), who disallowed the refund citing non-challenge of the assessment order by the importer, following the precedent set by the Supreme Court in Priya Blue Industries case.

Upon appeal, the Appellate Tribunal found that the imported goods were indeed subject to a 5% duty rate, while the appellant paid 10% inadvertently. The Commissioner (Appeals) rejected the refund claim due to the importer not challenging the assessment order. However, the Tribunal referenced the Delhi High Court case of Aman Medical Products Ltd., which clarified that a refund claim can be filed even without challenging the assessment order if there is no dispute between the importer and the Revenue at the time of clearance. The Tribunal noted that in this case, there was no 'lis' or contest between the parties during clearance, and the higher duty payment was due to ignorance, not intentional evasion.

Based on the Delhi High Court's interpretation of the Customs Act and the similarity of facts with the Aman Medical case, the Tribunal concluded that the appellant was entitled to the refund of the excess duty paid. Therefore, the Tribunal set aside the Commissioner (Appeals) decision and upheld the original authority's order, allowing the refund claim.