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TMI Blog2025 (3) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant did not become entitled for a refund on their filing of the Bill of Entry for warehousing but only after it was finalized. After the first final assessment order, the appellant filed an appeal before Commissioner (Appeals) which was allowed vide order dated 03.06.2008. Therefore, assessee became entitled for refund as a result of the order of Commissioner (Appeals) dated 03.06.2008. Therefore, the appellant was bound to get the refund application processed under Section 27 of the Customs Act. Whether the refund application was barred by limitation as it was not filed within the prescribed period mentioned in Section 27 of Customs Act? - HELD THAT:- No doubt the duty paid by the appellant was made refundable by the Commissioner (Appeals) vide order dated 03.06.2008 but the department opted for continuation of the said litigation by filing an appeal before the CESTAT. Once that option got exercised, the final judgment about entitlement of appellant to have the refund of the said duty paid, is the judgement pronounced by CESTAT on 13.10.2015 in the said appeal. Since the appeal of the department was dismissed by CESTAT on 13.10.2015, the entitlement of the appellant to refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd. Feeling aggrieved from the said decision the department preferred an appeal before Hon'ble Tribunal and the same was rejected by the CESTAT vide order dated 13.10.2015. In these circumstances, the appellant filed a refund claim for Rs. 6,19,110/- on 1st December, 2015 under Section 27 of the Customs Act, 1962, as a consequence of order No. A/11442/2015 dated 13.10.2015 passed by CESTAT rejecting the appeal against Order-in-Appeal No. 125/JMN/2008 dated 3rd June, 2008. 1.2 The lower adjudicating authority found vide order dated 16.02.2016 that the duty had become refundable as a consequence of the relevant order-inappeal dated 3rd June, 2008 passed by the first appellate authority. The said Order-in-Original remained in force during that period. The claim has been filed on 1st December, 2015 and it was not filed within the stipulated time limit in terms of Section 27 of the said Act and therefore, it is hit by limitation. The lower adjudicating authority also found that even otherwise the refund amount was to be credited to the Consumer Welfare Fund since the refund amount Rs. 6,19,110/- has been booked on 30.09.2015 in the fiscal year 2015-16 under "claims receivable fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is filed on 19.02.2018 which, therefore, is very much within one year. Therefore, the refund application was wrongly held to be barred by time. Accordingly, Tribunal set aside the findings arrived at by the Commissioner (Appeals) and allowed the appeal. 2.2 The learned Counsel for the appellant in the light of the observations made in the above decision argued that in this case, the Bill of Entry was filed by the appellant which was assessed provisionally and when subsequently, the appellant filed ex-bond Bill of Entry for Home Consumption under Section 68 of the Customs Act for clearance of imported warehoused goods, they were also assessed provisionally. However, the period of limitation shall be counted from the date of final order passed by the CESTAT dated 13.10.2015 and not from the date of the order passed by the Commissioner dated 03.06.2008 because no doubt, the duty paid by the appellant was made refundable by the Commissioner (Appeals) vide order dated 03.06.2008 but the department opted for continuation of the said litigation by filing an appeal before the CESTAT. Once that option got exercised, the final judgment about entitlement of appellant to have the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mit such document or information within such time, and the proper officer shall finalise the provisional assessment within such time and in such manner, as may be prescribed.] (2) When the duty leviable on such goods is assessed finally 3 [or re-assessed by the proper officer] in accordance with the provisions of this Act, then-- (a) in the case of goods cleared for home consumption or exportation, the amount paid shall be adjusted against the duty 4 [finally assessed or reassessed, as the case may be,] and if the amount so paid falls short of, or is in excess of 5 [the duty 4 [finally assessed or re-assessed, as the case may be,]], the importer or the exporter of the goods shall pay the deficiency or be entitled to a refund, as the case may be; (b) in the case of warehoused goods, the proper officer may, where the duty 4 [finally assessed or re-assessed, as the case may be,] is in excess of the duty provisionally assessed, require the importer to execute a bond, binding himself in a sum equal to twice the amount of the excess duty. 6 [(3) The importer or exporter shall be liable to pay interest, on any amount payable to the Central Government, consequent to the final a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his behalf and the application shall be accompanied by such documentary or other evidence (including the documents referred to in section 28C as the applicant may furnish to establish that the amount of duty and interest, if any, paid on such duty in relation to which such refund is claimed was collected from, or paid by, him and the incidence of such duty and interest, if any, paid on such duty had not been passed on by him to any other person: Provided that where an application for refund has been made before the commencement of the Central Excise and Customs Law (amendment) Act, 1991, such application shall be deemed to have been made under this subsection and the same shall be dealt in accordance with the provisions of subsection (2): Provided further that the limitation of one year or six months, as the case may be, shall not apply where any duty or interest has been paid under protest. Provided also that in the case of goods which are exempt from payment of duty by a special order issued under sub-section (2) of section 25, the limitation of one year or six months, as the case may be, shall be computed from the date of issue of such order, Provided also that where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment and Explanation II to Section 27 is not applicable since Bill of Entry was provisionally assessed on 10.06.2006 and the provision of unjust enrichment was introduced from 13.07.2006. This argument has no force because after going through Section 18(2) of the Customs Act, it is clear that in case of provisional assessment, the party becomes entitled for refund only after final assessment, as the provision of this section starts with "When the duty leviable on such goods is assessed finally". 3.2 The learned Authorized Representative further submitted that in the instant case Bill of Entry for warehousing was provisionally assessed on 10.06.2006 Ex-Bond Bill of Entry was filed on 12.06.2006, the Bill of Entry was finalized on 15.03.2007 since some original documents were pending, so final assessment was done for the first time on 15.03.2007 which is certainly after 13.07.2006. The appellant did not become entitle for a refund on their filing of the Bill of Entry for warehousing but rather only after it was finalized, though even the first final assessment did not result into refund for the appellant. After the first assessment order, the appellant filed an appeal be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Authorities below. 4. I have heard learned Counsel for the appellant and learned Authorized Representative for the department and perused the record. 4.1 As far as the first argument of the learned Counsel for the appellant is concerned that the refund claim is not barred by limitation and it was wrongly held by the Commissioner (Appeals) that it is barred by limitation, I am of the view that in case of Provisional Assessment under Section 18 of the Customs Act, the party become entitled for refund only after final assessment, because the provision of Section 18(2) of the Customs Act starts with words "When the duty leviable on such goods is assessed finally". Further in Sub Section 18 (a) and (b), it has been provided that the amount paid shall be adjusted against the duty finally assessed. In the present case, Bill of Entry was finalized on 15.03.2007 and final assessment was done for the first time on 15.03.2007 after the cut-off date 13.07.2006, after which the doctrine of Unjust Enrichment became applicable. I also agree with the learned Authorized Representative that the appellant did not become entitled for a refund on their filing of the Bill of En ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this connection, it was submitted that the amount of refund was shown as receivable in books of accounts and the certificate of the Chartered Accountant clearly confirmed this fact. Therefore, the question of Unjust Enrichment could not apply. In this connection, the learned Counsel for the appellant drew my attention towards Order-in-Original dated 16.02.2016 passed by the Assistant Commissioner, Customs in file No. VIII/20RD/26/2015-16 at page no.07 of the judgment in para 23 of which it has been mentioned "I further find that the claimant had shown an amount of Rs.1,67,21,345/- as claimable in its books of account as on 31.03.2007. Based on the final assessment of the Bills of Entry, the department allowed a refund of Rs.1,42,44,722/- vide Order-in-Original No.228/AC/R/2008-09 dated 28.04.2008. Therefore, the differential amount seems to have been adjusted in the books of accounts, as an amount of Rs.6,19,110/- has been booked on 30.09.2015 in the Fiscal Year 2015-2016 now under Claims Receivable from Customs. This is evident from the relevant extract of the Ledger of Claims Receivable from Customs and relevant documents viz. List of Tanker wise Customs claims at Vadinar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... department, I am of the view that when the Chartered Accountant has given a certificate after verification of accounts and corroborative evidences that the duty incidence has not been passed on to the customers then this certificate should not be brushed aside without any cogent reason and the lower Adjudicating Authority and the learned Commissioner (Appeals) has brushed aside the Chartered Accountant certificate without any cogent reason. 4.8 I also agree with the learned Counsel for the appellant that appellant is a public sector undertaking under the control of the Union Ministry of Petroleum and Natural Gas. This Tribunal can take notice of the fact that the prices of the petroleum products were fixed at the relevant time by the Government. During the period of disputes, the prices of major petroleum products like MS, HSD, LPG (Domestic) and SKO (PDS) were controlled by Government due to their sensitive nature. Due to Government control, these products were sold at a uniform price by all Public Sector Undertakings/ marketing companies which were generally lower than the price computed on the basis of import parity/ trade parity. Thus, the cost of raw material or other element ..... X X X X Extracts X X X X X X X X Extracts X X X X
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