2014 (9) TMI 217 - HC - Customs

Refund of excess duty - Petitioner exported iron ore 44,988 Dry Metric Tonnes, vide Shipping Bill No. 76/2008-09, dated 25-9-2008, and paid an amount of ₹ 2,91,18,483/- as export duty, provisionally as against ₹ 2,39,75,336/- actually payable. - Held that - merely because an SLP has been filed before the Supreme Court against the order of the Tribunal, the respondents cannot withhold the money, which is otherwise determined as the entitlement of the petitioner. As observed by the Appellate Authority in Order-in-Appeal No. 07/2009(G) Cus., dated 12-8-2009, primarily it is the duty of the authorities to levy, charge and collect the appropriate duty as applicable. In this case it is a finding of the authorities to the effect that at the time of clearance of the goods, petitioner had paid an excess amount of duty provisionally, and the petitioner was entitled to refund such excess amount. Petitioner is entitled to the refund as claimed by him - Decided in favor of assessee.

Issues Involved:
1. Refund of excess duty.
2. Legality of the letter dated 8-8-2012.
3. Applicability of interest on the refund amount.
4. Maintainability of refund claim without challenging the assessment order.
5. Finality of the assessment of the Shipping Bill.
6. Calculation method for export duty.

Detailed Analysis:

1. Refund of Excess Duty:
The petitioner sought a refund of Rs. 51,43,147/- paid as excess duty on the export of iron ore, arguing that the customs department assessed the export duty on the FOB value without deducting the duty element, contrary to C.B.E. & C. Circular No. 18/2008-Cus., dated 10-11-2008. The appellate authority and CESTAT confirmed the petitioner's entitlement to the refund, noting that the assessment was conditional and not final.

2. Legality of the Letter Dated 8-8-2012:
The petitioner challenged the letter dated 8-8-2012 issued by the respondents as illegal and arbitrary. The court found that the respondents' objections raised in the writ petition were not part of the original proceedings and hence could not be entertained at this stage.

3. Applicability of Interest on the Refund Amount:
The court referenced the Supreme Court judgment in Ranbaxy Laboratories Ltd. v. Union of India, which clarified that interest under Section 11BB of the Act becomes payable if the refund is not made within three months from the date of receipt of the refund application. The petitioner was deemed entitled to interest on the refund amount as per the relevant provisions of the Act.

4. Maintainability of Refund Claim Without Challenging the Assessment Order:
The appellate authority held that filing a refund claim itself is a challenge to the assessment order. This was supported by the CESTAT, which stated that a separate appeal against the assessment order was not required, and the refund claim could proceed irrespective of whether the assessment was final or provisional.

5. Finality of the Assessment of the Shipping Bill:
The appellate authority and CESTAT found that the assessment of the Shipping Bill was conditional and not final, as it was subject to the outcome of the Customs examination report. The Assistant Commissioner was required to correct any errors or omissions under Section 154 of the Customs Act, 1962.

6. Calculation Method for Export Duty:
The court referenced the Board's Circular No. 18/2008-Cus., which mandated that for exports made before 1-1-2009, the FOB price should be taken as inclusive of customs duty. The appellate authority and CESTAT concluded that the transaction value for calculating export duty should have been the FOB value minus the duty element, and the Assistant Commissioner's assessment was contrary to this directive.

Conclusion:
The court directed the respondents to implement the Order-in-Appeal No. 7/2009(G) Cus., dated 12-8-2009, as confirmed by the Tribunal's order dated 29-11-2010, and to refund the excess duty amount along with applicable interest. The writ petition was allowed, and no costs were imposed.

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