Gowri Shankar, Member (T)
1. The appellant filed 56 refund claims (one for each bill of entry in which the goods were cleared) to the Assistant Collector at Kandla Customs House in August, 1988 seeking refund of the difference of duty payable according to the decision of the Bombay High Court and the duty actually paid. The claim was not acted upon for six years. By order passed in 1994, the Assistant Collector held the claim (except for a small amount) to be admissible on merits but held that, the appellant had not proved, as was required by application of Sub-section (2) of Section 27 of the Act, as it stood after its amendment after 1991, that the incidence of duty has not been passed on. He therefore ordered it to be credited to the Consumer Welfare Fund. This order was confirmed by the Commissioner (Appeals) on appeal filed by the importer. Hence this appeal.
2. The contention of the advocate for the appellant is that the refund arose as a consequence of the finalisation of provisional assessment. It was not necessary for the appellant to file the refund claims. Section 18 of the Act itself provides, in such a situation that, consequent upon finalisation of provisional assessment, any amount collected from the importer in excess shall be refunded. In paragraph 96 of its judgment in Mafatlal Industries v. Union of India that any refund arising out of adjustment under Sub-rule (5) of Rule 9B of the Rules, will not be governed by Section 11A or Section 11B of the Act. The same position will apply to the provisions under the Customs Act.
3. The logic of this argument has to be accepted. It was, in fact, not necessary for the appellant to file the refund claims. Even if they had not been filed, the department would have been obligated in terms of Sub-section (2) of Section 18 of the Act to refund the amount to the appellant. The refund that was granted to the appellant therefore was a refund consequent upon the finalisation of the provisional assessment under which the goods were cleared.
4. Clause (a) of Sub-section (2) of Section 18 of the Act are, except for differences required by the context in pari materia the provisions of Sub-rule (5) of rule 9B of the Rules, both the Rule 9B(c) and Section 18 (2) (a) of the Act provides that when the duty leviable on the goods is assessed finally, the duty provisionally assessed shall be adjusted against the final duty assessed, and if the duty provisionally assessed falls short of, or is in excess of the duty finally assessed, the assessee, in the case of rule 9B (c), the importer or the exporter, in case of Section 18, shall pay the deficiency or be entitled to refund, as the case may be.
5. The Supreme Court in its judgment, relied upon by the advocate for the appellant, has held that refund payable under rule 9B(c) will not be subjected to the provisions of Section 11A of the Act. The observation of the Supreme Court apply on equal force to the refund of Customs duty, as a result of provisional assessment. The same principles of law, and the same procedures apply here. Accordingly, the ratio of the Supreme Court’s judgment will apply to the facts before me. The qualification in the Court’s judgment that this would not apply where an appeal is filed against an order of assessment need not concerned us, as no such appeal has been filed.
6. It will then follow that the appellant could not be denied the refund, by application of Section 27 of the Act and would therefore be entitled to receive the refund.
7. The appeal is accordingly allowed and the impugned order set aside. Consequential relief.