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of <h1>Importer cannot claim Additional Duty refund without mandatory re-assessment under Section 17 of Customs Act</h1> <h3>Commissioner of Customs, ACC Import Commissionerate Versus M/s. Micromax Information Ltd. (Vice-Versa)</h3> Commissioner of Customs, ACC Import Commissionerate Versus M/s. Micromax Information Ltd. (Vice-Versa) - TMI 1. ISSUES PRESENTED and CONSIDEREDThe core legal issues considered in this judgment include:(A) Departmental Appeals:i. The legality and propriety of the Order-in-Appeal no. CC(A)Cus/D-I/ACC-Import/Refund/NCH/664/2018-19 dated 11.02.2019, which held that the appellants are entitled to a refund of Rs.18.38 crores and remanded the case for a fresh order based on a CA certificate and other documents.ii. The legality and propriety of the Order-in-Appeal no. CC(A)Cus/D-I/ACC-Import/Refund/NCH/666/2018-19 dated 11.02.2019, which similarly held that the appellants are entitled to a refund of Rs.35.89 crores and remanded the case for a fresh order based on a CA certificate and other documents.(B) Party Appeals:i. The legality and propriety of the Order-in-Appeal no CC(A)Cus/D-I/Import/NCH/5130/2023-24 dated 01.03.2024, which allowed the Departmental appeal and set aside the impugned Order-in-Original No. 101/VP/2019 dt. 24.06.2019.ii. The legality and propriety of the Order-in-Appeal no CC(A)Cus/D-I/Import/NCH/5129/2023-24 dated 01.03.2024, which allowed the Departmental appeal and set aside the impugned Order-in-Original No. 102/VP/2019 dated 27.06.2019.2. ISSUE-WISE DETAILED ANALYSISA. Requirement of Re-assessment before Refund- Relevant Legal Framework and Precedents: The judgment in ITC Ltd. v. CCE Kolkata [2019 (368) ELT 216] emphasizes that a refund application cannot be processed without reassessment. Self-assessment is considered an assessment, and any aggrieved party must file an appeal for reassessment under Section 128 of the Customs Act.- Court's Interpretation and Reasoning: The Court held that the self-assessment done by Micromax amounts to an assessment. Without reassessment of the Bills of Entry, the benefit under the relevant notifications cannot be availed.- Key Evidence and Findings: The Court noted that Micromax did not file an appeal for reassessment of the Bills of Entry, which is a prerequisite for claiming a refund.- Application of Law to Facts: The Court applied the ITC judgment to conclude that the refund claim filed by Micromax without reassessment is not legal.- Treatment of Competing Arguments: The Court rejected the argument that the refund was not subject to reassessment, emphasizing the need for reassessment as per the ITC judgment.- Conclusions: The refund claims are not sustainable without reassessment, and the appeals based on such claims are dismissed.B. Unjust Enrichment- Relevant Legal Framework and Precedents: The doctrine of unjust enrichment prevents a party from retaining a benefit unjustly. The burden is on the claimant to prove that the duty has not been passed on to the consumer.- Court's Interpretation and Reasoning: The Court found that Micromax failed to demonstrate that the duty was not passed on to consumers, thus attracting the doctrine of unjust enrichment.- Key Evidence and Findings: The adjudicating authority's examination of balance sheets and CA certificates indicated that the duty had been passed on.- Application of Law to Facts: The Court concluded that the incidence of duty was passed on to the buyers, making the refund claim unsustainable.- Treatment of Competing Arguments: The Court rejected the argument that the refund was not subject to unjust enrichment, citing the lack of evidence to support the claim.- Conclusions: The refund claims are barred by unjust enrichment, and the appeals based on such claims are dismissed.3. SIGNIFICANT HOLDINGS- The Court emphasized the necessity of reassessment before processing refund claims, as established in the ITC judgment.- The doctrine of unjust enrichment applies, barring refunds when the duty incidence is passed on to consumers.- The Court upheld the Departmental appeals, setting aside the Orders-in-Appeal that granted refunds without reassessment.- The Court dismissed the party appeals, affirming the Orders-in-Appeal that set aside the Orders-in-Original granting refunds.- The Court reinforced the principle that claims based on another party's judgment are not sustainable without independent reassessment.- Final Determinations:(A) In Departmental appeals:i) Order-in-Appeal no. CC(A)Cus/D-I/ACC-Import/Refund/ NCH/664/2018-19 dated 11.02.2019 is set aside, and departmental appeal C/51109/2019 is allowed.ii) Order-in-Appeal no. CC(A)Cus/D-I/ACC-Import/Refund/NCH/ 666/2018-19 dated 11.02.2019 is set aside, and departmental appeal C/51110/2019 is allowed.(B) In Party Appeals:i) Order-in-Appeal no CC(A)Cus/D-I/Import/NCH/5130/2023-24 dated 01.03.2024 is upheld, and party's appeal C/50824/2024 is rejected.ii) Order-in-Appeal no. CC(A)Cus/D-I/Import/NCH/ 5129/2023-24 dated 01.03.2024 is upheld, and party's appeal C/50825/2024 is rejected.
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