TaxTMI 
TaxTMI 
TaxTMI 
2026 (3) TMI 217
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....submitted by them. The petitioner had also obtained clearance of the imported goods from the Customs Department based on their declaration in the 11 Bills of Entry. Subsequently, DRI had investigated the matter on the ground that Shrimp Larvae Feed imported by the petitioner was not in pellet form, and therefore, the benefit of exemption granted to the petitioner from paying higher customs duty at 30% Ad valorem was incorrect, and hence, the petitioner is liable to pay the differential duty for the import of Shrimp Larvae Feed in non-pellet form during 2014-2017 under 11 Bills of Entry. 3. According to the petitioner, based on the advise of DRI, it had deposited a sum of Rs.3,16,91,824/- with the Customs Department, being the differential customs duty payable by them. The petitioner claims that even though on the advise of DRI they had deposited a sum of Rs.3,16,91,824/- with the Customs Department, they were under the belief that they should seek clarification in the notification relied upon by DRI for claiming differential customs duty from them. Therefore, the petitioner claims that they had stated in the letter dated 05.03.2019 that they desire to approach the related Minist....
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....ther than in pellet form will also attract 5% customs duty, has passed the impugned order dated 04.07.2022 rejecting the petitioner's request for refund of Rs.3,16,91,824/-. 7. The second respondent in the counter affidavit has raised the preliminary objection as to the maintainability of the writ petition on the ground of availability of alternative appellate remedy to the petitioner, if aggrieved by the impugned order. According to the respondents, the basic customs duty for import of Prawn Feed, Shrimp Larvae Feed and Fish Feed in non-pellet form is 30%. But, if Prawn Feed, Shrimp Larvae Feed and Fish Feed are imported in pellet form, then the importers are entitled for an exemption under the basic customs duty and the rate of duty to be paid is only 5% instead of 30%. 8. According to the respondents, the petitioner, by letter dated 05.03.2019, admitted to the stand taken by DRI and they paid the entire differential duty along with applicable interest. According to the respondents, the petitioner, upon payment of basic customs duty, requested the respondents to conclude the investigation. According to the respondents, based on their request, DRI concluded the investigation....
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....use notice as per the provisions of Section 28 of the Customs Act, 1962. Time to issue show cause notice under Section 28 of the Customs Act had also got expired in the case on hand. Since the sum of Rs.3,16,91,824/- was collected by the Customs Department without issuing show cause notice under Section 28 of the Customs Act, the said sum has to be refunded to the petitioner by the respondents. 11. The learned Senior counsel appearing for the petitioner, in support of his contention that any payment made during DRI investigation is a payment made under protest, has relied upon the following authorities:- (a) Commissioner of C.Ex., Coimbatore Vs. Pricol Ltd. [2015 (320) ELT 703 (Mad.)]; and (b) Commissioner of C.Ex., Lucknow Vs. Eveready Industries India Ltd. [2017 (357) ELT 11(All.)]. (c) WPIL Ltd., Ghaziabad Vs. Commissioner of Central Excise, Meerut, UP [MANU/SC/0122/2005] 12. According to the learned Senior counsel appearing for the petitioner, even in the absence of the word 'protest' in the letter issued by the petitioner or in the challan, the amount deposited by the petitioner during DRI investigation ought to have been necessarily treated as....
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....on, and therefore, it is clear that the 2019 notification is only an amendment and by way of an amendment, the basic customs duty has been reduced to 5%. All amendments are only prospective in nature. Since the subject goods were imported by the petitioner between 2014 and 2017, the amendment Notification, 2019, does not apply to the petitioner's case. When the payment of the differential customs duty was paid by the petitioner voluntarily, and that the petitioner had also requested for closure of DRI investigation, there is no necessity to issue show cause notice as contemplated under Section 28 of the Customs Act, 1962. (h) The judgments relied upon by the learned Senior counsel for the petitioner are not applicable to the facts of the instant case, since, in all those cases, the importer never asked for closure of investigation, and Notification No.25/2019-Customs relied upon by the petitioner is only an amendment notification, which is prospective in nature and is not a clarificatory notification as claimed by the petitioner. DISCUSSION: 14. Based on the contentions of the respective parties, the following issues arise for consideration in this writ petition:- ....
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....closed the DRI investigation, the petitioner never raised any dispute with regard to collection of differential customs duty from them by the Customs Department. (e) Only after the closure of DRI investigation, the petitioner has agitated the issue for refund. 16. By relying upon the Finance Bill, 2019, and Notification No.25/2019-Customs, dated 06.07.2019, issued by the Government of India, Ministry of Finance, Department of Revenue, which stipulates that the customs duty payable for Prawn Feed, Shrimp Larvae Feed and Fish Feed in pellet form and non-pellet form is one and the same, the petitioner had filed an application seeking for refund of the differential customs duty paid by them to the Customs Department under Section 27 of the Customs Act, 1962, on 20.09.2019. The said application was filed seeking to refund a sum of Rs.3,01,01,534/- paid by them by way of differential customs duty and interest during DRI investigation. 17. Under the impugned order, the second respondent has rejected the petitioner's request for refund on the following grounds:- (a) The petitioner had paid the differential customs duty and interest voluntarily during the investigati....
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....well as in this writ petition, the petitioner has been raising the issue only with regard to the payment made by them during DRI investigation, which, according to them, was made only under protest. When the petitioner had not raised any hue and cry in the earlier writ petition as well as in this writ petition, with regard to the request made by them for closure of DRI investigation, the question of considering/entertaining their request for refund of the differential customs duty does not arise. If such a request is entertained, it will defeat the very purpose of DRI investigation and its sanctity will be lost. 20. The Customs Act provides for two methods of refund; one is refund of customs duty under Section 27 of the Customs Act, and the other is refund of deposit (Ex. Extra Duty Deposit (EDD)). The refund of the customs duty is governed by Section 27 of the Customs Act, while the deposit refund stem from the provisional assessment under Section 18 of the Customs Act. The limitation period for claiming customs duty refund is one year from the date of payment, whereas EDD refund often has no strict limitation period. For the customs duty refund, the importer must prove that th....
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....oner's request for closure of DRI investigation, the petitioner had raised any dispute with regard to the differential duty and interest collected from the petitioner during DRI investigation. Only as an afterthought, after DRI had accepted the request of the petitioner, and had also closed the DRI investigation, which was also communicated to the petitioner through the DRI's letter dated 03.07.2019, the petitioner, for the first time, had made an allegation that the payment collected from the petitioner by DRI was a payment made under protest. The conduct of the petitioner is clearly hit by the doctrine of "estoppel by conduct". Having made to believe that the petitioner will not raise any dispute with regard to collection of the differential duty and interest, and DRI having acted upon the request of the petitioner to close the DRI investigation, the petitioner's conduct in reopening the issue will amount to giving a go-by to the sanctity of the DRI investigation and will also amount to unjust enrichment if the application for refund is now entertained. 23. Notification No.25/2019-Customs, dated 06.07.2019, issued by the Government of India, Ministry of Finance, Revenue Depart....
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....thereto shall be omitted; (7) ............................." 24. The Finance Act, 2019, also did not incorporate Sl.No.45 of Finance Bill, 2019, which was relied upon by the learned Senior counsel for the petitioner during the course of his arguments. Sl.No.45 of the Finance Bill, 2019, read as follows:- "45. 2309.. Clarification is being issued that prawn feed and shrimp larvae feed, other than in pellet form will also attract 5% customs duty applicable on other fish feed in pellet form." 25. As could be seen from the Finance Act, 2019, which is binding, and not the Finance Bill, the Finance Act, 2019, did not use the terminology 'clarification', and it has used the term 'amendment', which means any changes are only prospective and not retrospective. 26. In the earlier writ petition filed by the petitioner in W.P.No.14126 of 2020, this Court, by its order dated 24.11.2021, while remanding the matter back to the respondent for fresh consideration, observed that the amount paid by the petitioner during DRI investigation has to be treated as an amount paid under protest. The said observation made in the earlier writ petition has no bearing for deciding the ....
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....r that the principle of unjust enrichment is applicable for such refund. (c) The decision of the Hon'ble Supreme Court in WPIL Ltd., Ghaziabad Vs. Commissioner of Central Excise, Meerut, UP [MANU/SC/0122/2005] is not applicable to the facts of the instant case. When Notification No.25/2019-Customs, dated 06.07.2019, relied upon by the learned Senior counsel for the petitioner has made it clear that the said notification is only an amendment to the earlier notification, and being an amendment, which has been made in public interest, the said amendment is only prospective and not retrospective as claimed by the learned Senior counsel for the petitioner. Therefore, the aforesaid decisions relied upon by the learned Senior counsel for the petitioner do no enure to the benefit of the petitioner. 28. Having made DRI to close the investigation, the petitioner cannot now reopen the issue of refund, that too, when the petitioner either in this writ petition or in the earlier writ petition had not explained as to why a request was made to DRI to close the investigation. If such a refund application is entertained, Pandora's box will be opened by permitting unscrupulous claims of ....