Settlement scheme adjustment of pre-deposit bars later refund claim after final computation of duty arrears.

A pre-deposit made during appellate proceedings was adjusted while computing duty arrears under the Kar Vivad Samadhan Scheme, and that adjustment became final once the assessee voluntarily opted for settlement and obtained relief on that basis. Amounts already paid or deposited are treated under the scheme as payments towards the disputed duty, penalty, fine or interest, with only the balance counted as arrears for settlement. The assessee could not reopen the settled computation or claim refund of the sum appropriated in determining scheme liability. The refund claim was therefore not maintainable, and its rejection was upheld.

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Issues: Whether the pre-deposit made during the earlier proceedings could be claimed as refund after the assessee opted for settlement under the Kar Vivad Samadhan Scheme and the designated authority adjusted that amount while computing the duty arrears.

Analysis: The pre-deposit had been made pursuant to the appellate proceedings and was specifically taken into account while working out the amount payable under the settlement scheme. Under the scheme, part payments or deposits already made are treated as amounts paid towards the duties, fine, penalties or interest in dispute, and only the balance is reckoned as arrears for settlement. Once the assessee voluntarily opted for the scheme, declared the amount accordingly, and obtained settlement on that basis, the adjustment became final. In such circumstances, the assessee could not reopen the settlement or seek refund of the very amount that had been appropriated in computing the scheme liability.

Conclusion: The refund claim was not maintainable and the rejection of the claim was correct.

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