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TMI Blog2024 (11) TMI 807X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal, it is not disputed that the amount has been paid twice because of some miscommunication or any other factor including what appellants are saying as malfunctioning of ICEGATE. It is not the case where it has been paid under the provision which has been held to be ultra vires of the constitution or it was paid due to incorrect appreciation of law. At best, it will fall within the category of clerical error or factual mistake or lack of information but by no stretch of imagination, such payment would fall under the nature of deposit or illegal levy. In this case there has been a mistake in making excess payment of Customs Duty, which is not being disputed by either sides, however, this excess payment, whether it is in the nature of duty or otherwise has been discussed in detail the foregoing paras and it is clear that in the given set of facts, it was in the nature of duty only and therefore, it would be required to be dealt with in accordance with the provisions under Section 27 of the Customs Act in view of various judgments cited in support of the submissions that refund of any amount under the Customs Act has to be dealt with in accordance with Section 27 only and not oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D-19 and thereafter worked out the due date for filing refund application as on or before 29.05.2022. However, since even after this exclusion, the refund application was filed much beyond the limitation period, it was held as time barred, considering the statutory provisions under Section 27 of the Customs Act, 1962. He also distinguished various case laws cited by the appellant and relied on the judgment of Hon ble Supreme Court holding that for the refund of any amount under Section 11B, the time limitation has to be followed mandatorily. He has also relied on the judgments in the following cases in support of his conclusion that provisions for time limit under the statute are mandatory and that a statutory authority cannot traverse beyond the confines of law and cannot grant relief by bypassing the bar of limitation:- a) M/s Cummins Technologies India Pvt Ltd Vs Assistant Commissioner, Mumbai [Writ Petition No. 4193 of 2022 (High Court Bombay)] b) Miles India Ltd Vs ACC [1987 (30) ELT 641 (SC)] c) CCE Vs Doaba Coop. Sugar Mills [AIR 1988 SC 2052 1988 (37) ELT 478 (SC)] 4. Commissioner (Appeals), in the impugned order, has examined various case laws relied upon by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ologies International Vs UOI [2016 (339) ELT 21] 6. Learned Advocate for the appellant has mainly argued that in the facts of the case, the amount deposited again on 17.01.2020 was not in the nature of duty but it was in the nature of deposit and therefore, the provisions of Customs Act would not be applicable and instead the provisions of General law of limitation would be applicable. As per the limitation law, three years period is admissible and if the period between 15.03.2020 and 28.02.2022 is excluded in view of the order of the Hon ble Supreme Court for exclusion of the same for computing limitation period on account of COVID, then the claim has been filed well within the period of three years. He has vigorously canvassed that Department cannot retain any unlawful amount and they are bound to return the same to the appellant. It has not been disputed that the amount of duty in respect of same Bill of Entry has been paid twice; once on 10.01.2020 and another on 17.01.2020. As regards the claim being filed as late as on 10.08.2023, he informs that they had realized their mistake on 17.01.2020 itself, however, they were not aware as to who would be the authority with whom they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y due to mis-construction, mis-interpretation or error of facts or law, the same has to be regulated by the provisions and rigour of limitation as provided under statutory provisions. In the case of MGM International Exports Ltd (supra), the Hon ble Madras High Court held that payment of tax and appropriation and collection by service tax department at best was on account of mis-construction of provision of Finance Act and therefore, any refund of such tax paid or borne by any person would be governed by provisions of Central Excise Act as made applicable to refund under Finance Act, 1994. In the case of Cannanore Handloom Exports (supra), the Hon ble High Court of Kerala relying on their earlier judgment of Division Bench of the same Court in the case of Southern Surface Finishers (supra), inter alia, held that mistake, if committed by the assessee, whether it be on law or facts, the remedy would be only under the statute and if that be so, the question of law has to be answered in favour of Revenue and against the assessee. Therefore, in this case also, even though the payment was made erroneously, the provision of statute would be applicable. In the case of Uniroyal Marine Expor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be regulated by limitation provided within Section 27 of the Customs Act. He has further relied and elaborated on the judgments in the case of Ericsson India Pvt Ltd Vs CC [2022 (5) TMI 587 CESTAT New Delhi], wherein it was held that double payment cannot be treated as duty and must be refunded as the department has no legal authority to retain them. Similarly, in the case of United News of India Vs UOI [2004 (168) ELT 442 (Del)], the Hon ble Delhi High Court ruled that payments made in advance without assessment do not constitute duty and should be refunded without applying Section 27 limitations. He has further submitted that the Customs Authorities should refund excess payment suo moto relying on the judgment of Hon ble High Court of Delhi in the case of Indo Rama Synthetics (India) Ltd Vs UOI (supra). Additionally, he has submitted that the excess payment was made on 17.01.2020 under bonafide mistake and on realizing the same, they were making efforts to recover the same through bank, etc., but due to pandemic caused by COVID leading to significant operational disruption from 15.03.2020, they could not do so and therefore, keeping in view the general exclusion of period fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dt.30.10.2024, that it is not correct to say that the appellant had not claimed the refund of the amount as duty as they had paid the amount of Rs.5,03,984/- vide Challan No. CKL9331354 as customs duty and again filed for refund on 04.08.2023 asking for refund of customs duty paid in excess and therefore, the claim has to be examined within the purview of Section 27 of the Customs Act. He has also submitted that the reliance placed on the decisions viz., UPL Ltd (supra) and DHL Express India Pvt Ltd (supra) are not correct as these decisions have not taken into consideration the majority decision of the constitutional bench in the case of Mafatlal Industries Ltd (supra) at Para 99 and therefore, they are per incuriam. He has also distinguished the reliance placed by the appellant on the decision of the Apex Court in the case of Vedanta Ltd (supra) as in the said case, there was payment made in advance as also non-consideration of the majority decision in the case of Mafatlal Industries Ltd (supra). In fact, he submits that Hon ble Bombay High Court in the case of Cummins Technologies (supra) distinguished the Vedanta Ltd decision holding that the petitioner therein had filed applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant had come to Hon ble Supreme Court. The issue was whether the Customs Authorities, acting under the Act, were justified in disallowing the claim for refund as they were bound by the period of limitation provided therefor under Section 27(1) of the Customs Act, 1962 or otherwise. The Tribunal, relying on the judgments of Hon ble Supreme Court in the case of Commissioner of Sales Tax, UP Vs M/s Parson Tools and Plants, Kanpur [AIR-1975-SC-1039] and in the case of Sharif Ahmad and others etc Vs The Regional Transport Authority, Meerut and others etc [AIR- 1978-SC-209], had, inter alia, held that any claim filed before the Customs Authorities for refund of excess duty has to be treated under Section 27 of the Customs Act because there is no other provision providing for application for refund before the customs authorities, and the parties filing such refund claim are to be regulated by and restricted to the time limit provided therein. It also, inter alia, held that Tribunal while examining orders passed by such customs authorities, acting under the Act, has to examine their propriety and legality solely with reference to the provisions of the Act itself and that it is an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judgment of Hon ble Supreme Court in the case of Mafatlal Industries Ltd (supra), held that when the duty is paid without authority of law, the refund provisions under Section 27 of the Customs Act would not be applicable and the limitation in terms of Limitation Act would be applicable. This judgment relied on the cases of Mafatlal Industries Ltd, KVR Construction (supra), Geojit BNP Paribhas Financial Services Ltd (supra), Hind Agro Industries Ltd (supra), GB Engineers (supra) and Joshi Technologies International (supra) and came to the conclusion that for the customs duty paid in excess, the Department is liable to refund the same and limitation provided under Section 27 of the Act would not be applicable. Similarly, in the case of Ericsson India Pvt Ltd [2022 (5) TMI 587 CESTAT New Delhi], the coordinate bench of this Tribunal, inter alia, held that when the amount is paid twice, one of the payments has to be refunded and in terms of Section 17 of Limitation Act where there is an application for a relief from the consequences of the mistake, the period of limitation would not begin to run until the plaintiff or applicant has discovered the mistake, or could with reasonable dili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ween August 6, 1977 and November 17, 1980 contained sub-rule (4) which expressly declared: (4) Save as otherwise provided by or under this rule, no claim of refund of any duty shall be entertained . Section 11B, as in force prior to April, 1991 contained sub-section (4) in identical words. It said : (4) Save as otherwise provided by or under this Act, no claim for refund of any duty of excise shall be entertained . Sub-section (5) was more specific and emphatic. It said : Notwithstanding anything contained in any other law, the provisions of this section shall also apply to a claim for refund of any amount collected as duty of excise made on the ground that the goods in respect of which such amount was collected were not excisable or were entitled to exemption from duty and no court shall have any jurisdiction in respect of such claim. It started with a non-obstante clause; it took in every kind of refund and every claim for refund and it expressly barred the jurisdiction of courts in respect of such claim. Sub-section (3) of Section 11B, as it now stands, is to the same effect - indeed, more comprehensive and all-encompassing. It says, (3) Notwithstanding anything to the contrary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntal and ancillary provisions. As pointed out in the Statement of Objects and Reasons appended to the Bill which became the Act, the Act along with the Rules was intended to form a complete central excise code . The idea was to consolidate in a single enactment all the laws relating to central duties of excise . The Act is a self-contained enactment. It contains provisions for collecting the taxes which are due according to law but have not been collected and also for refunding the taxes which have been collected contrary to law, viz., Sections 11A and 11B and its allied provisions. Both provisions contain a uniform rule of limitation, viz., six months, with an exception in each case. Sections 11 and 11B are complimentary to each other. To such a situation, Proposition No. 3 enunciated in Kamala Mills becomes applicable, viz., where a statute creates a special right or a liability and also provides the procedure for the determination of the right or liability by the Tribunals constituted in that behalf and provides further that all questions about the said right and liability shall be determined by the Tribunals so constituted, the resort to civil court is not available - except to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tract Act. So far as the jurisdiction of the High Court under Article 226 - or for that matter, the jurisdiction of this court under Article 32 - is concerned, it is obvious that the provisions of the Act cannot bar and curtail these remedies. It is, however, equally obvious that while exercising the power under Article 226/Article 32, the Court would certainly take note of the legislative intent manifested in the provisions of the Act and would exercise their jurisdiction consistent with the provisions of the enactment. . . 96. It would be evident from the above discussion that the claims for refund under the said two enactments constitute an independent regimen. Every decision favourable to an assessee/manufacturer, whether on the question of classification, valuation or any other issue, does not automatically entail refund. Section 11B of the Central Excises and Salt Act and Section 27 of the Contract Act, whether before or after 1991 amendment - as interpreted by us herein - make every refund claim subject to proof of not passing-on the burden of duty to others. Even if a suit is filed, the very same condition operates. Similarly, the High Court while examining its jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le 265 of the Constitution of India and hence, any tax collected, retained or not refunded in accordance with the said provisions must be held to be collected, retained or not refunded, as the case may be, under the authority of law. Both the enactments are self-contained enactments providing for levy, assessment, recovery and refund of duties, imposed thereunder . Section 11B of the Central Excises and Salt Act and Section 27 of the Customs Act, both before and after the 1991 (Amendment) Act are constitutionally valid and have to be followed and given effect to. Section 72 of the Contract Act has no application to such a claim of refund and cannot form a basis for maintaining a suit or a writ petition. All refund claims except those mentioned under Proposition (ii) below have to be and must be filed and adjudicated under the provisions of the Central Excises and Salt Act or the Customs Act, as the case may be. It is necessary to emphasise in this behalf that Act provides a complete mechanism for correcting any errors whether of fact or law and that not only an appeal is provided to a Tribunal - which is not a departmental organ - but to this Court, which is a civil court. (ii) Whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en passed on, the claimant cannot say that he has suffered any real loss or prejudice. The real loss or prejudice is suffered in such a case by the person who has ultimately borne the burden and it is only that person who can legitimately claim its refund. But where such person does not come forward or where it is not possible to refund the amount to him for one or the other reason, it is just and appropriate that that amount is retained by the State, i.e., by the people. There is no immorality or impropriety involved in such a proposition. The doctrine of unjust enrichment is a just and salutory doctrine. No person can seek to collect the duty from both ends. In other words, he cannot collect the duty from his purchaser at one end and also collect the same duty from the State on the ground that it has been collected from him contrary to law. The power of the Court is not meant to be exercised for unjustly enriching a person. The doctrine of unjust enrichment is, however, inapplicable to the State. State represents the people of the country. No one can speak of the people being unjustly enriched. 20. As would be apparent from the majority order that even when there is refund emanat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the assessees paid up the tax and later realised that they are entitled to exemption. Going by the majority judgment, in Mafatlal Industries Limited (supra), we have to find such cases being subjected to the rigour of limitation as provided under Section 11B. The limitation, in the relevant period, being one year, there could be no refund application maintained after that period. We, hence, find the order impugned in the writ petitions to be proper and we dismiss the writ petitions. We hold that the judgment dated 6-7-2015 in WP (C) No. 18126/2015 [2015 (39) S.T.R. 706 (Ker.)] [M/s. Geojit BNP Paribas Financial Services Ltd. v. Commissioner of Central Excise] is not good law, going by the binding precedent in Mafatlal Industries Limited (supra). The writ petitions would stand dismissed answering the reference in favour of the Revenue and against the assessees. No costs. 21. Similarly, in the case of Karanja Terminal Logistics Pvt Ltd Vs CCGST CE, Mumbai [2024 (10) TMI 1060 CESTAT Mumbai], after considering the judgment of Hon ble Supreme Court in the case of Doaba Cooperative Sugar Mills (supra), inter alia, it was held that on careful reading of the constitutional Bench judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act are bound by the provisions of the Customs Act and if the proceedings are taken under the Customs Act by the department, the provisions of limitation prescribed in the Customs Act will prevail. 24. I also find that in a recent judgment by the Larger Bench of the Tribunal in the case of Oil and Natural Gas Corporation Ltd [Final Order No. 40696 of 2024 dt.20.06.2024], it was, inter alia, held that all refunds relating to illegal levy have to be pursued under Section 11B of Central Excise Act with an exception to the jurisdiction of High Courts under Article 226 and Supreme Court under Article 32 of the Constitution of India. The relevant portion of the order is reproduced as under:- 73.A simple reading of the said observation it is clear that a claim of refund when it is in the nature of illegal levy , necessarily to be pursued under and in accordance with the provisions of the respective enactment whereunder it is paid; the mechanism/ procedure for its refund is prescribed under the said enactment, including the authorities specified thereunder and the period of limitation prescribed therein. This is clear from their lordships observation as: no suit is maintainable in that beh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as if it was being paid in discharge of levy or duty, it would be in the nature of duty itself even if at a later date it was found to be in excess or was not required to be paid at all for any reason other than the levy itself is held as unconstitutional. The law provides for remedy in the Act itself, however, that is subject to certain procedures and limitations. There is no unconstitutionality about either levy of Customs Duty under the proper provisions or for processing of refunds under Section 27. The grounds for seeking refund can be many and varied but the correct appreciation of majority judgment in the case of Mafatlal Industries Ltd (supra) would indicate that all the claims have to be processed within the four walls of the statute specially by the authorities working within the ambit of the statute. In other words, limitation under the relevant Act has to be complied with. The appellants have relied on plethora of case laws and I have perused the same. I find that these cases have either relied on some case laws, which had not taken into account the majority judgment in the case of Mafatlal Industries Ltd (supra) and therefore, may not have the binding precedent. In th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n ble Kerala High Court in the case of Southern Surface Finishers (supra). The judgment in the case of Hind Agro Industries Ltd (supra), relied upon by the appellant, was distinguished by the Division Bench of Hon ble Delhi High Court in the case of HT Media Ltd [2017 (6) GSTL 266 (Del)]. In fact, in the case of HT Media Ltd (supra), the Hon ble Delhi High Court, at Para 9, held as follows:- 9. In both, Hind Agro Industries Limited (supra) and Alar Impex Private Limited (supra), the question examined was whether the levy in question, which was cess in one case (Hind Agro) and service tax in the other (Alar Impex), was at all payable in the first instance. As far as the levy of cess is concerned, this Court in Hind Agro Industries Limited (supra) held that it was outside the purview of customs duty under Section 27 of the Customs Act, 1962. In Alar Impex Private Limited (supra), this Court found that the CESTAT had failed to satisfy itself that the services rendered by the appellant were, on facts, amenable to Service Tax . Where the services rendered were not amenable to service tax, the question of applying for refund under Section 11B of the CE Act would not arise. 27. The judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, on appreciation of various case laws of Hon ble Supreme Court, Hon ble High Courts and Tribunals, I am of the view that barring the situation where the refund is filed on account of unconstitutionality of the levy itself, all kinds of refund have to be dealt with the statutory provisions within the statute and its entire provisions would be applicable in full force including limitation. In the present appeal, it is not disputed that the amount has been paid twice because of some miscommunication or any other factor including what appellants are saying as malfunctioning of ICEGATE. It is not the case where it has been paid under the provision which has been held to be ultra vires of the constitution or it was paid due to incorrect appreciation of law. At best, it will fall within the category of clerical error or factual mistake or lack of information but by no stretch of imagination, such payment would fall under the nature of deposit or illegal levy. When the second payment was made on 17.01.2020, it was made as if it was being paid as duty of customs and the claim for refund has also been filed before the customs authority in the provided format as if it was duty of custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at challan was rejected initially as the duty was short paid, which was made good on 17.01.2020. Thus, the first payment on 10.01.2020 as well as additional payment made subsequent thereto, on 17.01.2020 have all been made in the nature of customs duty only even though it may be an excess payment of duty than what was otherwise required to be paid. In view of the clear decision of the Hon ble Supreme Court, it is now a settled position that except for unconstitutionality of the levy, the rest of the refunds are to be dealt with within the provisions of Customs Act only. It is also settled position that authorities working under the Customs Act cannot entertain a refund claim applying the general law of limitation. As far as the various case laws cited and the non-applicability of the judgment relied upon by the Commissioner (Appeals), I find that it has been fairly explained by the learned AR that all these judgments are either distinguishable on account of there being per incuriam or there being difference in the nature of duty paid viz., advance payment of duty either for export or import. Hence I do not find any substantive grounds in the claim of the learned Advocate that the C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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