Rubber cess not leviable as additional customs duty on imports; refund claim still subject to limitation and unjust enrichment

Cess under Section 12 of the Rubber Act, 1947 was held not leviable as additional duty of customs under Section 3 of the Customs Tariff Act, 1975 on imported rubber, following the view accepted in the Supreme Court orders rather than the contrary Larger Bench view. The refund dispute was not finally decided on merits because the lower authority had not examined whether the claim was within limitation or hit by unjust enrichment. Those statutory bars were remitted for fresh determination by the original authority.

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Issues: Whether cess levied under Section 12 of the Rubber Act, 1947 was recoverable as additional duty of customs under Section 3 of the Customs Tariff Act, 1975 on imported rubber, and whether the refund claim required fresh examination on limitation and unjust enrichment.

Analysis: The question had already been answered in earlier decisions of the appellate forum, and the Court preferred the view reflected in the Supreme Court's orders over the contrary Larger Bench view. On that basis, it was held that no cess under Section 12 of the Rubber Act, 1947 was payable as additional duty of customs under Section 3 of the Customs Tariff Act, 1975 in respect of imported rubber. Since the lower appellate authority had proceeded on the footing that the duty was payable, it had not examined whether the refund claim was within time or barred by unjust enrichment. Those questions required consideration by the original authority.

Conclusion: The liability to pay cess as additional duty of customs on the imported rubber was negatived, and the refund matter was sent back for determination of limitation and unjust enrichment.

Final Conclusion: The assessee succeeded on the core duty-liability issue, and the matter was remitted for adjudication of the refund claim on the remaining statutory bars.

Ratio Decidendi: Cess under the Rubber Act is not leviable as additional duty of customs on imported rubber under Section 3 of the Customs Tariff Act, 1975, and any refund claim arising from such levy must still be tested on limitation and unjust enrichment.

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