Provisional customs assessment deposits were treated as security, making unjust enrichment and refund-bar rules inapplicable on finalisation.

Amounts deposited at provisional clearance under Section 18 of the Customs Act were treated as security for provisional assessment, not as payment of customs duty, where final assessment accepted the declared value. On that basis, refund arising on finalisation was held outside the ordinary customs duty refund bar under Section 27, by applying the reasoning that Section 18 and Rule 9B of the Central Excise Rules operate on a pari materia basis. The doctrine of unjust enrichment was held inapplicable to such a refund, and the manner in which the amount was shown in the balance sheet was treated as irrelevant. The importer was entitled to refund of the full deposit.

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Issues: Whether the amount deposited at the time of provisional clearance of imported goods was a mere security deposit refundable on finalisation of assessment, and whether the doctrine of unjust enrichment and the refund bar under Section 27 of the Customs Act applied to such refund.

Analysis: The clearance had been permitted on provisional assessment under Section 18 of the Customs Act against 5% loading, and on finalisation the declared value was accepted. The amount paid was therefore in the nature of security for provisional assessment and not a payment of customs duty. On the reasoning adopted in the decision treating Section 18 of the Customs Act and Rule 9B of the Central Excise Rules as pari materia, recoveries or refunds arising from finalisation of provisional assessment do not attract the statutory provisions governing duty refunds. The doctrine of unjust enrichment was held inapplicable to such a refund, and the consideration of how the amount was reflected in the balance sheet was treated as irrelevant.

Conclusion: The importer was entitled to refund of the entire amount deposited, and the refund could not be denied or restricted on the ground of unjust enrichment.

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