Appellate Tribunal allows appeal on duty paid for imported software, considers assessment challenge a valid protest

The Appellate Tribunal CESTAT, New Delhi allowed the appeal filed by M/s. Hutchison Max Telecom Pvt. Ltd., extending the benefit of Notification No. 11/97-Cus for duty paid on imported computer software. The Tribunal held that the refund claim, rejected for being time-barred under Section 27 of the Customs Act, was filed within the time limit as the assessment was challenged through appeal, constituting a protest. The matter was remanded to the Adjudicating Authority to assess unjust enrichment following principles of natural justice.

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Issues involved: Appeal against rejection of refund claim u/s Section 27 of the Customs Act for duty paid on imported computer software under Notification No. 11/97-Cus.

Summary:
In the appeal before the Appellate Tribunal CESTAT, New Delhi, filed by M/s. Hutchison Max Telecom Pvt. Ltd., the issue pertained to the rejection of their refund claim for duty paid on imported computer software. The Appellants, a Mobile Telephone service provider, had imported software and claimed exemption u/s Notification No. 11/97-Cus. The Customs Department did not grant the exemption, and the goods were cleared on payment of duty. Subsequently, the Tribunal allowed their appeal, extending the benefit of the notification. The Appellants then filed a refund claim, which was rejected as being beyond the time limit specified in Section 27 of the Customs Act. The Appellants argued that the refund claim was filed within the time limit as the assessment of the goods was done by the Tribunal. The Revenue contended that filing an appeal does not equate to duty paid under protest and does not protect against filing a refund claim beyond the time limit.

Upon considering the submissions, the Tribunal noted that the Appellants had challenged the denial of the notification benefit through appeal, which constitutes a protest. It was established that the Appellants did not file the refund claim without challenging the assessment, in line with the Tribunal's previous decision. Therefore, the Tribunal held that the refund of duty paid cannot be denied on the grounds of being time-barred. The matter was remanded to the Adjudicating Authority to determine the applicability of the principle of unjust enrichment in the case, following the principles of natural justice.

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