Component parts may include spare parts for customs exemption, but refund claims remain subject to unjust enrichment.

Customs exemption notifications can extend the expression "component parts" to spare parts where the wording and factual setting support that coverage, so warranty spares for centrifugal compressors were treated as eligible for concessional duty. Refund entitlement, however, remains subject to the amended post-1991 regime under Section 27 of the Customs Act, under which the bar of unjust enrichment applies. The commentary therefore distinguishes between eligibility for notification benefit and the separate statutory test governing refund claims.

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Issues: (i) Whether driving lever with bellows imported as warranty spares for centrifugal compressors was eligible for concessional duty under Notification No. 111/86-Cus. dated 17-2-1986 and Notification No. 60/87-Cus. dated 1-3-1987. (ii) Whether the refund claim was barred by unjust enrichment under Section 27 of the Customs Act.

Issue (i): Whether driving lever with bellows imported as warranty spares for centrifugal compressors was eligible for concessional duty under Notification No. 111/86-Cus. dated 17-2-1986 and Notification No. 60/87-Cus. dated 1-3-1987.

Analysis: The expression "component parts" in the relevant notifications was held to cover spare parts. The imported goods were found to be component parts of compressors over 7.5 H.P. meant for use in refrigerators and air-conditioning equipment, and the earlier view denying the benefit merely because the goods were spares was rejected.

Conclusion: The benefit of the notifications was held to be available to the imported goods, in favour of the assessee.

Issue (ii): Whether the refund claim was barred by unjust enrichment under Section 27 of the Customs Act.

Analysis: The refund claim was directed to be tested under the amended post-1991 regime of Section 27 of the Customs Act, under which the bar of unjust enrichment applies.

Conclusion: The bar of unjust enrichment was held applicable, against the assessee.

Final Conclusion: The goods were held entitled to the notification benefit, but any refund was made subject to the amended statutory bar of unjust enrichment.

Ratio Decidendi: For customs exemption notifications, the expression "component parts" may include spare parts where the notification and factual setting support such coverage, but refund entitlement remains governed by the amended unjust enrichment requirement under Section 27 of the Customs Act.

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