2015 (10) TMI 1773 - AT - Customs

Rejection of refund claim Unjust enrichment Impugned orders rejected refund claims of appellants on grounds of unjust enrichment Whether bar of unjust enrichment is applicable to cases wherein assessment has been finalized after 13.07.2006 but provisional assessment has been made prior to that under Customs Act or not Held that -In appellants own previous case wherein appellant sought relief of excess duty paid, came to be rejected on grounds that claim is hit by bar of unjust enrichment In said case after consideration it was concluded that there was no unjust enrichment in view of fact that price of MS petro product is being fixed by Government In present case also, admittedly price has been administered by APM regime and selling price has been fixed by Government Therefore, facts of appellant s own case are similar to facts of this case In said circumstances, bar of unjust enrichment is not applicable to facts of these appeals Appellant is entitled for refund claim Impugned orders set aside Decided in favour of assesse.

Summary

Issues:
- Refund claims rejected on the ground of unjust enrichment
- Applicability of unjust enrichment to cases with finalized assessment after 13.07.2006 but provisional assessment prior to that date

Analysis:
1. The appellants appealed against the rejection of their refund claims based on the bar of unjust enrichment. The provisional duty payment for their product was made between December 1999 and February 2002 and April 2001, with finalization in February 2009 to April 2009. Refund applications were submitted in August 2009 but were denied due to alleged failure to pass the unjust enrichment bar.

2. The appellant's counsel argued that the bar of unjust enrichment should not apply to provisional assessments made before 13.07.2006, citing relevant case laws and tribunal decisions. They contended that if the price is controlled by the government, passing the incident to the customer is neither reasonable nor logical, thus justifying their refund claim.

3. The opposing party argued that the final assessment was completed before 13.07.2006, making the case law cited by the appellant irrelevant. They maintained that the lower authorities correctly rejected the refund claim after verifying that the unjust enrichment bar was not passed. The opposing party also distinguished the relevance of a specific case law mentioned by the appellant.

4. The Tribunal considered whether the bar of unjust enrichment applies to cases where final assessment occurred after 13.07.2006 but provisional assessment was conducted earlier. Referring to a previous case, the Tribunal concluded that unjust enrichment would not apply to refund claims arising from provisional assessments made before a certain date, even if the final assessment was done later.

5. The Tribunal noted a similar case where the issue of unjust enrichment was discussed, and it was determined that if the price is fixed by the government, the bar of unjust enrichment may not be applicable. Applying this reasoning to the present case, where the price was administered by the government, the Tribunal held that the unjust enrichment bar did not apply, allowing the appellant's refund claim.

6. Consequently, the Tribunal ruled in favor of the appellant, setting aside the impugned orders and allowing the appeals with any necessary consequential relief. The judgment was pronounced on 22.07.2015.