DEPB Scrip Refund Granted: Excess Customs Duty Refundable under Customs Act

The Tribunal allowed the appeal, granting the appellant a refund of Rs. 43,95,212 paid through the DEPB scrip. The decision was based on precedents from various High Courts and the Customs Act, 1962, concluding that excess custom duty paid through DEPB scrip is refundable. The Tribunal set aside the previous order, emphasizing the appellant's entitlement to the refund.

---

---

Issues:
Refund of excess custom duty paid through DEPB scrip.

Analysis:
The appeal was filed against an Order-in-Appeal by the Commissioner (Appeals) upholding the decision of the Dy. Commissioner regarding the refund of excess custom duty paid by the appellant on imported Rock Phosphates. The appellant imported raw materials for fertilizer manufacturing and paid custom duties on a provisional assessment basis. The Dy. Commissioner found an excess payment of Rs. 1,24,70,514, refunding a portion but withholding Rs. 43,95,212 paid via DEPB scrip. The appellant argued for full refund citing relevant case laws. The Commissioner (Appeals) upheld the decision based on a CBEC Circular. The appellant then appealed to the Tribunal.

The main issue was whether excess custom duty paid through DEPB scrip is refundable under the Customs Act, 1962. The Tribunal analyzed the lower authorities' orders, grounds of appeal, and submissions. It noted that the CBEC Circular relied upon by the Commissioner (Appeals) had been declared ultra vires by the Delhi High Court and Madras High Court in previous cases. Additionally, the Calcutta High Court had ruled that the right to refund is not lost by using the DEPB scheme. Based on these precedents, the Tribunal concluded that the appellant was entitled to the refund of the balance amount paid from the DEPB scrip.

The Tribunal set aside the impugned order and allowed the appeal, granting the appellant the refund of Rs. 43,95,212 paid through the DEPB scrip. The decision was made in accordance with the judgments of the High Courts and the provisions of the Customs Act, 1962.

---