2018 (12) TMI 802 - HC - Customs

Refund of excess duty paid - rejection of refund on the ground that the Petitioner had not submitted reassessed bill of entries on the basis of which the Petitioner was claiming the refund - Section 27 of the Customs Act, 1962 - Held that - In consonance with amendments, defination of term assessment conferred in Section 2(2) of the Act has also been suitably modified. Prior to amendments of 8th April, 2011 term assessment was defined as so include provisional assessment, reassessment and any order of assessment in which duty assessed is nil. Post amendments of 8th April, 2011 term assessment includes self assessment also. Instead of referring to claim of refund of duty or interest paid in pursuance of the order of assessment or borne by him, the amended Section 27 merely refers to the claim of refund of duty or interest paid or borne by the refund claimant. Thus, earlier reference to the refund of duty or interest paid pursuant to an order of assessment is now deleted. This would be in consonance with the changed procedure for clearance of imported goods as contained in Section 17 of the Act. There is no question of challenging the self assessed bill of entries. The Department has cited as many as 10 defects in the refund application. - Once the Petitioner replied to such communication in detail, in subsequent communications the authority confined his objection only to the question of the assessment not having been revised or set aside. Thus, all other objections of not supplying documents or details were waived or can be seen to have been satisfied through correspondence. Section 149 of the Act provides that a proper officer may at his discretion authorize a document after it is presented in the Custom House to be amended. Proviso to Section 149 clearly lays down that no amendment of bill of entry shall be authorized to be amended after imported goods have been cleared for home consumption. Thus, the opportunity to have the bill of entry amended in terms of Section 149 of the Act, was simply not available to the Petitioner. Unjust enrichment - Held that - When there is no clarity in the order itself, whether the Competent Authority has accepted the Petitioner's evidence as to establishing the fact that the duty element has not been passed to any other person, we would like to tread cautiously. The sole objection contained in the impugned orders for rejection of the Petitioner's refund claims is overruled. The refund applications are revived - petition disposed off.

Issues Involved:
1. Rejection of refund claims by the customs authority.
2. Requirement of reassessment of bills of entry for claiming refund.
3. Compliance with deficiency memos issued by the customs authority.
4. Legal provisions and amendments under the Customs Act, 1962.
5. Applicability of Supreme Court and High Court judgments.

Detailed Analysis:

1. Rejection of Refund Claims by the Customs Authority:
The Petitioner, a company registered under the Companies Act, challenged the orders passed by the customs authority rejecting their refund claims for the period between July 2014 to June 2015. The Petitioner had paid additional duty of customs (CVD) at higher rates and later claimed that they were entitled to a concessional rate of 1% CVD under Notification No. 12 of 2012, as amended, based on the Supreme Court judgment in M/s SRF Limited Vs. CC, Chennai.

2. Requirement of Reassessment of Bills of Entry for Claiming Refund:
The customs authority rejected the refund claims on the ground that the Petitioner had not submitted reassessed bills of entry. The authority relied on the Supreme Court judgments in M/s Priya Blue Industries and CC v. Flock India Ltd., which stated that an importer must challenge the assessment order to claim a refund. The Petitioner contended that there is no legal requirement for reassessment of bills of entry for claiming a refund, citing several judicial pronouncements supporting their position.

3. Compliance with Deficiency Memos Issued by the Customs Authority:
The customs authority issued multiple deficiency memos pointing out various deficiencies in the refund applications, including the lack of reassessed bills of entry. The Petitioner responded to these memos, arguing that there is no statutory requirement for reassessment under the Customs Act, 1962, and cited relevant case law to support their claim. Despite these representations, the authority maintained its stance and rejected the refund claims.

4. Legal Provisions and Amendments Under the Customs Act, 1962:
The Court examined the statutory provisions and amendments under Sections 17 and 27 of the Customs Act, 1962. Prior to the amendments effective from 8th April 2011, the Act required examination and assessment by the proper officer. Post-amendment, the Act introduced self-assessment by the importer and provided for verification and reassessment by the proper officer if necessary. The amended Section 27 allowed any person claiming a refund of duty or interest paid or borne by them to make an application without the need for reassessment of the bill of entry.

5. Applicability of Supreme Court and High Court Judgments:
The Court referred to the Delhi High Court's judgment in Micromax Informatics Limited, which held that post-amendment, the customs authority must consider refund applications even if the assessment order has not been challenged. The Court concurred with this view and noted that the statutory scheme had undergone significant changes, eliminating the requirement for reassessment for claiming refunds. The Court also acknowledged that the Petitioner had cited relevant case law, including the Delhi High Court's decision, which the customs authority failed to consider.

Conclusion:
The Court overruled the sole objection of the customs authority regarding the requirement for reassessment of bills of entry. The refund applications were revived, and the customs authority was directed to process them afresh, focusing solely on whether the Petitioner had established that the excess duty collected had not been passed on to any other person. The fresh order was to be passed by 31st January 2019.

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