2023 (3) TMI 1132 - AT - Customs

Seeking refund of the excess additional duty of customs paid - period 26.03.2015 to 22.06.2015 - application was filed beyond the period of one year and hit by time limitation or not - principles of unjust enrichment - HELD THAT - It is undisputed that the issue was decided by the Hon ble High Court of Delhi in its judgement dated 06.08.2018 and the matter was remanded to the original authority to decide the refund on merits. It is also evident from the judgment that the question of limitation was asserted by the Revenue before the High Court and it was not accepted. Therefore, there was no error on the part of either the Assistant Commissioner or the Commissioner (Appeals) in sanctioning the refund without considering the limitation as both authorities were bound by the order of the Delhi High Court. Unjust enrichment - HELD THAT - By examining what treatment was given to the disputed amount of duty or tax in the accounts, it can easily be verified whether it was passed on, either directly or indirectly, to the customers. In this case it has not been so passed. Learned special counsel for the Revenue vehemently argued that the Chartered Accountant s certificate cannot be relied upon. However, on a query from the Bench, he could not produce any document whatsoever to either establish the fact that duty has been passed on by the respondent or to show that the Chartered Accountant certificate s was incorrect. There are no force in this submission of the learned special counsel. In the absence of any evidence by the Revenue on this count, the submission by the respondent that during the relevant period, M/s Naveen Associates were their Chartered Accountants must be accepted. Even otherwise, there is no requirement in law that a certificate must be issued only by the statutory auditors. So long as the certificate is issued by a Chartered Accountant and it is consistent with the accounts such as Balance Sheet and Profit and Loss statement, the certificate deserves to be accepted. The appeal filed by the Revenue deserves to be dismissed - Appeal dismissed.

Summary

Issues Involved:
1. Limitation
2. Unjust enrichment

Summary:

Limitation:
Revenue filed an appeal challenging the order dated 21.03.2022 by the Commissioner of Customs (Appeals), which upheld the Assistant Commissioner's decision to sanction a refund to the respondent. The respondent, a Private Limited Company importing and selling mobile phones in India, had paid additional duty of customs under protest. Following the Supreme Court's ruling in SRF Limited Vs. Commissioner of Customs, the respondent filed a refund claim on 24.06.2016 for the excess additional duty paid between 26.03.2015 to 22.06.2015. The Assistant Commissioner initially rejected this claim, but the Delhi High Court later ruled in favor of the respondent, directing the refund application to be decided on its merits. The Assistant Commissioner subsequently sanctioned the refund, which was upheld by the Commissioner (Appeals). Revenue argued that the refund was time-barred under Section 27(2) of the Customs Act, as it was filed beyond the one-year limitation period. However, the High Court had already addressed and dismissed this limitation argument, compelling the Assistant Commissioner and Commissioner (Appeals) to follow the High Court's order.

Unjust Enrichment:
Revenue also contended that the refund claim was subject to unjust enrichment, arguing that the importer had indicated the amount paid as duty under Section 27. The respondent countered this by submitting a self-declaration and a Chartered Accountant's certificate from M/s Naveen Associates, confirming that the excess amount was not passed on to consumers. The balance sheet for FY 2015-16 listed the excess duty as a receivable under "customs duty refund receivable." The Commissioner (Appeals) noted that the Chartered Accountant's certificate was valid, and the duty was not passed on to buyers. Revenue challenged the credibility of the Chartered Accountant's certificate, asserting that M/s Naveen Associates were not the statutory auditors. However, the respondent maintained that they were the statutory auditors during the relevant period. The Tribunal found no evidence from Revenue to disprove the Chartered Accountant's certificate or to establish that the duty was passed on to buyers. The Tribunal concluded that the refund was not hit by unjust enrichment.

Conclusion:
The Tribunal dismissed the Revenue's appeal, emphasizing that the Assistant Commissioner and Commissioner (Appeals) correctly followed the Delhi High Court's order. The Tribunal found no merit in Revenue's arguments regarding limitation and unjust enrichment, thereby upholding the refund to the respondent.