Refund under protest in customs dispute cannot be denied as time-barred where assessment and classification were contested.

Refund of duty paid during a challenge to assessment was treated as payment under protest where the dispute concerned classification and customs law did not prescribe an equivalent protest procedure to Rule 233B of the Central Excise Rules, 1944. The Tribunal held that the refund could not be rejected solely as time-barred on that basis, because the protest character of the payment flowed from the pending assessment dispute itself. The assessee therefore succeeded on limitation and the refund was not barred by time.

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Issues: Whether refund of duty could be denied as time-barred when the duty had been paid during challenge to the assessment and the payment was to be treated as payment under protest.

Analysis: The Tribunal held that the situation was not governed by Rule 233B of the Central Excise Rules, 1944 in the same manner as excise cases, because the refund arose under customs law and no equivalent protest procedure was prescribed there. It accepted the view that when the assessment itself is contested and the dispute concerns classification, the payment is to be treated as made under protest. On that basis, the refund could not be rejected solely on limitation grounds.

Conclusion: The refund was not barred by time limitation and the assessee succeeded on the issue.

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