2017 (4) TMI 1116 - AT - Customs

Tribunal rules against Revenue in import case, citing unjust enrichment provisions.

Commissioner of Central Excise, Lucknow Versus M/s Indian Oil Corporation Ltd.

The Tribunal dismissed the Revenue's appeal, ruling that the provisions of unjust enrichment were not applicable in the case involving import of Crude ... Refund of customs duty - rejection on the ground of unjust enrichment and non filing of requisite documents - Held that: - the provisions of Section 18 of CA, 1962 that there was no need to file application for refund because the provisions of Section 18 of CA, 1962 have provided for consequential refund suo-moto by the Officer assessing finalization of provisional assessment and since such a refund order was not passed on finalization the respondents were compelled to file refund application u/s 27 of CA, 1962 - Hon’ble High Court of Delhi in the respondent's own case, Commissioner of Customs Versus Indian Oil Corporation [2012 (1) TMI 31 - DELHI HIGH COURT] has ruled that when an amount becomes refundable after a final order is passed, the same has to be refunded immediately and for such purpose, the assessee is not required to move an application u/S 27 of CA, 1962 - appeal dismissed - decided against Revenue. Issues:- Applicability of provisions of unjust enrichment in the case.Analysis:The appeal was filed by the Revenue against the Order-in-Appeal passed by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Lucknow. The case involved the import of Crude Petroleum, warehousing, and subsequent clearance to M/s Indian Oil Corporation Ltd. at Mathura. The assessments were initially provisional, resulting in a refund of Customs duty in excess of the duty finally assessed. The respondent filed 12 claims for refund, which were rejected by the Original Authority on grounds of unjust enrichment and non-filing of requisite documents. The Commissioner (Appeals) allowed the appeal, relying on previous judgments related to the applicability of unjust enrichment in cases of finalization of provisional assessments. The Revenue contended that the provisions of unjust enrichment were applicable in the present case.The Tribunal considered the provisions of Section 18 of the Customs Act, 1962, which provide for consequential refund suo-moto by the assessing officer upon finalization of provisional assessment. It was noted that the amendments to Sub-section 3, 4, and 5 of Section 18 were made effective from 13/07/2006, while the provisional assessments in this case were for the period before that date. Referring to a ruling by the Hon'ble High Court of Delhi, it was established that when an amount becomes refundable after a final order is passed, the refund must be made immediately without the need for the assessee to file an application under Section 27 of the Customs Act, 1962. The Tribunal held that the provisions of unjust enrichment were not applicable based on the interpretation of the relevant legal provisions and precedents cited.In conclusion, the Tribunal dismissed the appeal filed by the Revenue, stating that the respondent would be entitled to consequential relief as per the law. The Stay Application filed by the Revenue was also dismissed as infructuous. The decision was based on the understanding that the provisions of unjust enrichment did not apply in the circumstances of the case, as determined through a detailed analysis of the legal framework and relevant judicial interpretations.