2024 (9) TMI 1041 - AT - Customs

Refund of duty - partial refund of duty denied on the ground that original documents towards payment of duty were not produced - principles of unjust enrichment - HELD THAT - The Original Authority, having found that the appellant was eligible for refund should not have been in a hurry to reject the claims and could have given them time to furnish the original documents. It is expected that quasi-judicial authorities follow a fair procedure and ensure that the taxpayer is treated in a just and judicious manner. The Supreme Court, in the case of SAMBHAJI VERSUS GANGABAI 2008 (11) TMI 393 - SUPREME COURT , has held that procedure cannot be a tyrant but only a servant. It is not an obstruction in the implementation of the provisions of the Act, but an aid. The procedures are handmaid and not the mistress. It is a lubricant and not a resistance. The matter is remanded to the Original Authority, only to examine the original challans which shall be submitted by the appellant before her/him and if found correct to sanction the refund without delay - Appeal disposed off by way of remand.

Summary

Issues:
1. Refund of duty denied due to lack of original documents.
2. Justification for refund and unjust enrichment.
3. Compliance with Customs Act, 1962 for refund claims.
4. Fair procedure and treatment of taxpayers by quasi-judicial authorities.

Detailed Analysis:
1. The appeals before the Appellate Tribunal CESTAT CHENNAI arose from a common Order in Appeal passed by the Commissioner of Central Excise, Trichy, regarding the refund of duty on imported coal. The appellant had filed Bills of Entry for coal of Indonesian origin, which were provisionally assessed due to the absence of original documents. The adjudicating authority partially allowed the refund but disallowed a portion due to the lack of original documents, a decision upheld by the Commissioner (Appeals).

2. Ms. Shobhana Krishnan, representing the appellant, argued that the refund claims were eligible and not passing on the excess duty to others satisfied the unjust enrichment test. Despite willingness to submit original documents later, the Commissioner (Appeals) rejected the refund on procedural grounds. The appellant requested the Tribunal to grant the refund, emphasizing that substantial relief should not be denied based on procedural technicalities.

3. The impugned order highlighted the necessity of submitting relevant documents, including those proving duty payment, for refund claims under the Customs Act, 1962. The adjudicating authority had allowed refunds based on supporting documents but disallowed some amounts due to the absence of original duty payment evidence. The Commissioner (Appeals) upheld this decision, emphasizing the importance of complying with the statutory provisions for refund eligibility.

4. The Tribunal, after considering the arguments, set aside the impugned order and remanded the matter to the Original Authority. It emphasized the importance of a fair procedure, citing the Supreme Court's stance on procedure as a servant, not a tyrant. The Tribunal directed the Original Authority to examine the original challans provided by the appellant and, if correct, to sanction the refund promptly. Any discrepancies or variations in claims should be addressed in a speaking order within 90 days, ensuring the appellant's right to present submissions and evidence.

In conclusion, the Tribunal disposed of the appeals by emphasizing the need for a fair and just procedure in handling refund claims, instructing the Original Authority to reexamine the original documents and process the refund accordingly.