2012 (11) TMI 647 - AT - Customs

Refund - provisional assessment - doctrine of unjust enrichment Held that - Consequent to provisional assessment, refund arising on final assessment does not require test of unjust - No case was brought out by Revenue with the cogent evidence showing that appellant made refund claim not arising out of finalisation of provisional assessment - import was for captive consumption and appellant has not been unjustly enriched in favor of assessee

Summary

Issues:
1. Whether refund arising on final assessment after provisional assessment requires the test of unjust enrichment.
2. Applicability of the doctrine of unjust enrichment in the case of refund.

Analysis:
Issue 1: The appellant argued that according to the law in force at the relevant time, refund arising from final assessment after provisional assessment does not need to meet the test of unjust enrichment. They relied on the Tribunal's decision in Timken India Ltd. vs. CC, Kolkata and a Delhi High Court case involving Indian Oil Corporation. The Tribunal stated that unless specifically required by statute, refund from final assessment against provisional assessment need not undergo the unjust enrichment test. The Tribunal referred to a decision by the Hon'ble Supreme Court in the case of Commr. of Central Excise, Mumbai II v. Allied Photographies, emphasizing that refund arising from finalization of provisional assessment does not attract the bar of unjust enrichment. The Tribunal concluded that in the absence of evidence showing otherwise, the refund claim in this case arose from the finalization of provisional assessment, and hence, allowed the appeal.

Issue 2: The Revenue argued that the refund should undergo the test of unjust enrichment. However, the Tribunal, after hearing both sides and examining the records, found that the appellant had not been unjustly enriched as the import was for captive consumption. The Tribunal, following the principles laid down in previous judgments, held that the refund arising from the finalization of provisional assessment does not attract the bar of unjust enrichment. Consequently, the appeal was allowed in favor of the appellant.

In conclusion, the Tribunal held that in cases where refund arises from final assessment after provisional assessment, the doctrine of unjust enrichment does not apply unless specifically required by statute. The decision was based on established legal principles and previous judgments, ultimately resulting in the allowance of the appeal in favor of the appellant.