Tribunal grants refund claim for interest payment, citing specific Customs Act provisions. Precedent set for similar cases.

The Tribunal allowed the appeal, setting aside the lower authorities' decision to deny the appellant's refund claim for interest paid under protest. The Tribunal held that the appellant was entitled to the refund without having to establish unjust enrichment, as specific provisions of the Customs Act and a relevant circular exempted interest refunds from the unjust enrichment requirement. The decision emphasized the importance of statutory provisions and circulars in determining refund eligibility for interest payments under the Customs Act, establishing a precedent for similar cases. The adjudicating authority was directed to implement the refund within 30 days.

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Issues:
Refund of interest requiring passing the bar of unjust enrichment.

Analysis:
The appellant imported S.S. Tubes under an 'Into Bond Bill of Entry' for warehousing without the necessary import license, leading to the department demanding interest for the warehousing period. The appellant paid the interest under protest and later sought a refund, which was denied by lower authorities citing unjust enrichment. The appellant argued that as per Section 129 of the Customs Act, unjust enrichment should not apply to interest refunds. They also referenced a CBEC Circular and a previous case to support their position.

The Tribunal noted that the appellant had indeed paid interest under Section 61(2) of the Customs Act, and as per Circular No. 475/39/90-Cus VII, the provisions of Section 27 regarding unjust enrichment did not apply in this case. Citing a previous decision, the Tribunal ruled that the appellant was entitled to the refund claim of interest without having to pass the bar of unjust enrichment. Consequently, the impugned order was set aside, and the appeal was allowed with directions for the adjudicating authority to implement the order within 30 days.

This judgment clarifies the applicability of unjust enrichment in cases of interest refunds under the Customs Act, emphasizing that specific provisions and circulars can override general principles. The decision provides a clear precedent for similar cases where interest payments are made under specific sections of the law, offering guidance on the refund process and the requirement of passing the bar of unjust enrichment.

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