ORDER
S.S. Sekhon, Member (T)
1. The issue in this appeal is whether the refund claim made under Section 27 of the Customs Act, 1962 could be rejected on the grounds that the classifications and chargeability to C.V. Duty has been determined and the said assessments have not been challenged. The lower authorities have rejected the refund applications only on the ground that in respect of 12 BEs mentioned in this case, demand notices were issued and in respect of certain bills of entries, the short levies were confirmed, which have been paid by the importer and also in respect of certain BEs. The goods were assessed at higher rates of duty and since the demands had been confirmed and have not been nullified by any higher authorities, the assessments made under the higher rate classifying the goods was in order and the refund claims were not maintainable.
2. After hearing both sides, and considering the issues it is found :
(a) Whereas the learned Advocate for the appellants submits that in the case of Mecon Ltd. v. CC, Calcutta reported in 2003 (153) E.L.T. 574 = 2003 (55) RLT 219 (CEGAT-Kol.), after finding and holding as follows :-
(i) after considering the provisions of Section 27 of the Customs Act, 1962 it was held that if the refund claim cannot be made as the order of assessment itself has not been got set aside by filing a separate appeal against such an order, then provisions of Section 27(1)(i) will be rendered totally nugatory and meaningless. If this view is to be accepted, it would mean that refund claim can never be filed or allowed unless the Order of Assessment itself is separately appealed against and set aside. When that Section 27(1)(i) mentions about the duties paid in pursuance of “an order of assessment” it would obviously mean an “Order of Assessment” was in existence and that the duty in question was paid in pursuance of such Order of Assessment, refunds of which was being sought.
(ii) Relying upon the full Bench decision of Apex Court in the case of M/s. Karnataka Power Corporation, 2002 (143) E.L.T. 482, wherein the Supreme Court found that in that case, no appeal was filed against an order of assessment on the bills of entries and the customs duty so assessed was paid and thereafter the assessee had filed an application for reassessment and refund, the rejection of the same was found not correct. It was set aside and the matter was remanded back to the Assistant Collector to decide the claim of the assessee.
(iii) It was also held that availing of a refund claim would itself amount to filing a request for re-assessment and the Bill of Entry by the proper order and thereafter a refund would require to be met as per the provisions of Section 27 of the Customs Act, 1962.
(iv) They also relied upon the case of Dunlop India Ltd. v. U.O.I. [1995 (75) E.L.T. 35 (S.C.) = 1995 (7) RLT 11 (SC)] and the instructions in the CBEC Customs Manual of Instructions dated 11-9-2001, Chapter 15 thereof which prescribe that refunds could be claimed by an importer or exporter for even an incorrect assessment of duty of Customs under Section 27.
(v) They held, that the case of Flock India [2000 (120) E.L.T. 285 (S.C.) = 2000 (40) RLT 131 (SC)], would not be relevant to deny the benefit of refund if otherwise maintainable under Section 27 of the Customs Act as that decision was rendered by a Division Bench of the Hon’ble Apex Court, in the case of refund under Central Excise Act and it was found that the provisions of the Section 11B of the Central Excise Act and Section 27 were not para-materia.
(b) The Advocate for the appellants have relied upon the case of MSCO Pvt. Ltd. v. U.O.L and Ors. -1985 (19) E.L.T. 15 (S.C.) and on Shiv Shankar Dal Mills v. State of Haryana and Ors. (AIR 1980 SC 1037) to submit that if money recovered under colour of public laws is later discovered to be erroneous, levies are required to be erroneous and the rejections of refunds by the lower authorities was not good in law.
(c) On the other hand, the learned DR relied upon the decision in the case of National Engineering Industries Ltd. v. CCE, Jaipur [2002 (140) E.L.T. 122], wherein a Coordinate Bench of the Tribunal at Delhi had held that in view of the decision of Flock India Ltd., refunds under Section 27 of the Customs Act could not be granted.
(d) When we find that conflicting view as to the applicability of the law as laid down by the Apex Court in the case of Flock India [2000 (120) E.L.T. 285 (S.C.) = 2000 (40) RLT 131 S.C.] as regards the eligibility of refund under Section 27 exist, it would be necessary to refer this matter to a Larger Bench to resolve the dispute
being now created with the existence of these two contrary
views. The question to be placed for resolving before the Larger
Bench would be “For refunds under Section 27 of the Customs
Act, 1962 whether the view held in the Calcutta case should
prevail or the view held in the Jaipur case should prevail.”
3. The matter may therefore be placed before the Hon’ble President for referring this question to the Larger Bench.