Customs duty refund follows where split airway bills caused excess duty payment and the transaction was not short shipment.

Where a consignment booked under one master airway bill was split by the freight forwarder into two house airway bills without the importer's knowledge, and duty on the first bill of entry was paid for 1,200 pieces though it covered only 600, the situation was not short shipment. The shipping documents and examination report showed that the full consignment had arrived on the same aircraft, so the precedent cited by the Revenue did not apply. Correction of the bill of entry under Section 149 of the Customs Act was maintainable, and the excess customs duty paid on the first bill of entry was refundable.

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Issues: Whether the importer was entitled to refund of customs duty paid on the first bill of entry after it was found that the consignment had been split into two house airway bills and duty had been paid on 1200 pieces though the first bill of entry actually covered only 600 pieces, and whether the matter was a case of short shipment.

Analysis: The consignment was originally booked as one master airway bill and was later split by the freight forwarder into two house airway bills, each covering 600 pieces, without informing the importer. The examination report for the second bill of entry and the shipping documents showed that the entire consignment of 1200 pieces had in fact arrived on the same aircraft, and that duty on the first bill of entry had been paid on the basis of 1200 pieces though it related only to 600 pieces. On these facts, the situation was not one of short shipment, and the precedent relied on by the Revenue was held inapplicable. The importer's claim for correction under Section 149 of the Customs Act was therefore maintainable, and the excess duty paid on the first bill of entry was refundable.

Conclusion: The importer was entitled to refund of the excess customs duty, and the rejection of the refund claim was unsustainable.

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