Refund of customs investigation deposits and interest directed, with unjust enrichment held inapplicable under Section 27.

Amounts collected by customs during investigation were treated as not being duty paid for refund purposes under Section 27 of the Customs Act, 1962, so the refund could not be denied on unjust enrichment grounds. The Tribunal held the amount refundable to the applicant and applied the same approach to interest, directing interest at 12% on the refundable sum in line with the precedent relied upon. The issue of fixing responsibility for delay in implementation was left open for later consideration.

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Issues: (i) whether the amount collected by the customs department during investigation was refundable to the applicant and could be denied on the ground of unjust enrichment; (ii) whether interest was payable on the refundable amount.

Issue (i): whether the amount collected by the customs department during investigation was refundable to the applicant and could be denied on the ground of unjust enrichment.

Analysis: Amount collected during investigation is not duty paid for the purpose of Section 27 of the Customs Act, 1962. The objection based on unjust enrichment was rejected, and the amount was treated as refundable to the applicant.

Conclusion: The applicant was held entitled to refund of the amount collected during investigation.

Issue (ii): whether interest was payable on the refundable amount.

Analysis: In similar matters, interest had been directed on refunded sums, following the Supreme Court decision relied upon by the Tribunal. The same approach was applied here.

Conclusion: Interest at 12% was directed on the refundable amount.

Final Conclusion: The refund claim was allowed with interest, while the question of fixing responsibility for the delay in implementation was kept open for later consideration.

Ratio Decidendi: Amounts collected by customs during investigation are not treated as duty paid for refund purposes under Section 27 of the Customs Act, 1962, and refund cannot be denied on unjust enrichment grounds in such cases; interest may also be directed on the refundable sum.

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