2018 (2) TMI 494 - AT - Customs

Refund of excess duty paid - denial on the ground of unjust enrichment - whether the amount paid at the time of provisional assessment can be treated as pre-deposit of duty paid during the pendency of assessment or not? - Held that - Admittedly the appellant has opted for provisional assessment and the assessment has been finalized later on. So, therefore the amount paid by the appellant during the pendency of adjudication proceedings shall be the equivalent amount paid pending adjudication - after finalization of assessment, whatever excess duty has been paid by the appellant is refundable. The appellant is entitled to avail refund claim to excess duty paid by them before the finalization of the assessments - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Refund claim rejection based on unjust enrichment.

Analysis:
The appellant, a public sector undertaking, imported petroleum crude oil and paid duty on provisional assessment basis. Upon finalization, excess duty was found to have been paid, leading to a refund claim rejection due to alleged failure to pass the bar of unjust enrichment. The appellant contended that as selling prices were fixed by the Government, unjust enrichment did not apply. The AR argued the appellant failed to provide evidence of price fixation and thus was not entitled to a refund.

The crucial issue was whether the amount paid during provisional assessment could be considered a pre-deposit of duty. The Tribunal noted the appellant's provisional assessment choice and finalized assessment, concluding that excess duty paid was refundable. Citing the Allahabad High Court's stance on pre-deposits, the Tribunal held in favor of the appellant, emphasizing the refund entitlement for excess duty paid before assessment finalization.

The Tribunal rejected the Revenue's presumption argument regarding price fixation, emphasizing the historical practice of Government-set prices for petroleum products. Relying on judicial precedents, including the Ebiz. Com Pvt. Ltd. case, the Tribunal underscored that amounts paid as deposits during adjudication were not subject to unjust enrichment principles. Consequently, the Tribunal allowed the appellant's appeal, affirming their entitlement to the refund claim for excess duty paid prior to assessment finalization.