Provisional assessment refund: unjust enrichment bar inapplicable to identified excess duty; fresh refund claim not required.

Refund arising from finalisation of provisional assessment under the Customs Act was held not to attract the bar of unjust enrichment where the excess duty was specifically identified on the facts. In that setting, the refund was treated as consequential relief and could be granted without insisting on a fresh refund claim. The claimed exemption benefits, duty-free stores benefit, and deduction based on ship LDT were rejected because the vessel had been permitted for ship breaking, was no longer a foreign-going vessel, and no evidence supported exclusion of fuel, oil, foodstuffs, or bonded items from LDT.

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Issues: (i) Whether the bar of unjust enrichment applied to refund arising from finalisation of provisional assessment; (ii) whether refund could be granted without a separate refund claim; (iii) whether the importer was entitled to the claimed exemption benefits, duty-free stores benefit, and deduction related to ship LDT.

Issue (i): Whether the bar of unjust enrichment applied to refund arising from finalisation of provisional assessment.

Analysis: The assessment was provisional under Section 18 of the Customs Act, 1962 and the dispute related only to the differential duty. The amount found payable was later reduced, and the balance was held refundable. For the refundable portion, the duty was paid in the peculiar factual setting after the provisional assessment process and there was no sound basis to presume passing on of the burden in the same manner as in an ordinary final assessment dispute. The bar of unjust enrichment was therefore held inapplicable to the refundable amount.

Conclusion: The bar of unjust enrichment did not apply to the refund of the amount found excess.

Issue (ii): Whether refund could be granted without a separate refund claim.

Analysis: The matter had travelled through multiple rounds of proceedings, and the refund amount had already been identified as the excess balance after finalisation. In the peculiar facts of the case, insisting upon a fresh refund application was held unnecessary, and the refund was directed to follow as a consequential relief.

Conclusion: Refund was to be granted suo motu without insisting on a separate claim.

Issue (iii): Whether the importer was entitled to the claimed exemption benefits, duty-free stores benefit, and deduction related to ship LDT.

Analysis: The claimed exemptions were found not available on the facts, the benefit of imported stores retention on board was held confined to foreign-going vessels, and vessels already permitted to be beached for ship breaking no longer answered that description. No evidence supported the claim for reduction of the ship's LDT by excluding fuel, oil, food stuffs, or bonded items.

Conclusion: The claimed exemption benefits, duty-free stores benefit, and LDT-based deduction were rejected.

Final Conclusion: The appeal succeeded only to the extent that the identified excess amount was ordered to be refunded without the bar of unjust enrichment, while the remaining claims failed.

Ratio Decidendi: Refund arising from finalisation of provisional assessment, where the excess duty is specifically identified on the facts of the case, need not attract the bar of unjust enrichment and may be granted consequentially without a fresh refund claim.

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