2025 (2) TMI 1284 - AT - Customs

Refund of excess CVD under Section 3(5) denied for not challenging Bills of Entry under Section 128

The Tribunal (CESTAT Kolkata) dismissed the appellant-importer's appeals seeking refund of alleged excess CVD paid under Section 3(5) of the Customs ... Refund claims of excess CVD paid u/s 3(5) of the Customs Tariff Act, 1975 - absence of the re-assessment order of the Bills of Entry - without challenging the assessment or seeking modification of the assessment, whether the refund claims are maintainable or not? - HELD THAT:- The said issue has been answered by the Hon'ble Apex Court in the case of ITC Ltd. v. Commissioner of Central Excise, Kolkata-IV [2019 (9) TMI 802 - SUPREME COURT (LB)] wherein the Hon'ble Apex Court observed that 'the claim for refund cannot be entertained unless the order of assessment or self-assessment is modified in accordance with law by taking recourse to the appropriate proceedings and it would not be within the ken of Section 27 to set aside the order of self-assessment and reassess the duty for making refund; and in case any person is aggrieved by any order which would include self-assessment, he has to get the order modified under Section 128 or under other relevant provisions of the Act.' Thus, as the assessment of the Bills of Entry was neither modified nor challenged, the refund claims filed by the appellant are not maintainable - the appeals filed by the appellant are dismissed. 1. ISSUES PRESENTED AND CONSIDERED 1.1 Whether refund claims of excess CVD paid under section 3(5) of the Customs Tariff Act, 1975 are maintainable under section 27 of the Customs Act, 1962 when the original assessments on the relevant Bills of Entry have not been challenged, modified or re-assessed under the Act. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Maintainability of refund claims without challenging or modifying assessment of Bills of Entry Legal framework (as discussed by the Tribunal) 2.1 The Tribunal noted that the refund claims were filed under section 27 of the Customs Act, 1962, claiming excess CVD paid on imported goods, based on a subsequently claimed exemption/concessional rate. 2.2 The Tribunal relied on the judgment of the Supreme Court in ITC Ltd. v. Commissioner of Central Excise, Kolkata-IV [2019 (368) E.L.T. 216 (S.C.)], particularly paragraph 47, wherein it was held that a claim for refund cannot be entertained unless the order of assessment or self-assessment is modified in accordance with law by recourse to appropriate proceedings (e.g., appeal under section 128), and that section 27 does not empower the authority to set aside the order of self-assessment and reassess duty for the purpose of refund. Interpretation and reasoning 2.3 The Tribunal recorded that the appellant had filed refund claims for excess CVD paid, asserting entitlement to a concessional rate under a specific exemption notification, but had not challenged the assessments of the Bills of Entry or sought their re-assessment or modification. 2.4 The lower authorities had rejected the refund claims on the ground that the appellant had not produced any re-assessment orders of the Bills of Entry and had not challenged the original assessments, holding the refund claims as not maintainable. 2.5 The Tribunal framed the core question as whether, without challenging or seeking modification of the assessments, the refund claims could be entertained. 2.6 Applying the ratio of the Supreme Court in ITC Ltd., the Tribunal interpreted that any grievance regarding the quantum of duty assessed, including self-assessment, must first be addressed by having the assessment order modified through prescribed statutory mechanisms; a refund authority under section 27 cannot itself revisit or alter an assessment. 2.7 The Tribunal held that in view of the binding precedent of the Supreme Court, the failure of the appellant to challenge or seek modification of the assessments on the Bills of Entry rendered the refund claims legally non-maintainable, irrespective of the substantive arguments on entitlement to the concessional rate of CVD or the applicability of other case law cited by the appellant. Conclusions 2.8 The Tribunal concluded that, since the assessments of the relevant Bills of Entry had neither been challenged in appeal nor modified/re-assessed under the Customs Act, the refund claims were not maintainable under section 27. 2.9 The Tribunal upheld the rejection of the refund claims by the authorities below and dismissed the appeals.