Custom, Excise & Service Tax Tribunal
Commissioner Of Customs (Import), ... vs Bajaj Auto Ltd on 29 October, 2015
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Appeal No.
C/482/04
- Mum
(Arising out Order-in- Appeal No. 21/04-APTE (Airport) dated 17.02.2004 passed by the Commissioner of Customs, Mumbai)
For approval and signature:
Honble Mr. S.S. Garg, Member (Judicial)
Honble Mr. Raju, Member (Technical)
1. Whether Press Reporters may be allowed to see No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the No CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy Yes
of the Order?
4. Whether Order is to be circulated to the Departmental Yes
authorities?
Commissioner of Customs (Import), Mumbai
Appellant
Vs.
Bajaj Auto Ltd.
Respondent
Appearance:
Shri Chatru Singh, AC (AR) for the appellant Shri Makarand Joshi, Advocate for the respondent CORAM:
Honble Mr. S.S. Garg, Member (Judicial) Honble Mr. Raju, Member (Technical) Date of hearing : 07.10.2015 Date of decision : 29.10.2015 O R D E R No:..
Per : S.S. Garg This is a departments appeal against the order of Commissioner (Appeals) no. 21/04-APTE (Airport) dated 17.02.2004 by which the order of Adjudicating Authority was set aside.
2. The brief facts of the case are that Bajaj Auto Ltd. had imported Automatic Exhaust Emission Analysis System and filed bill of entry no. 4660/18.09.91 seeking classification of the goods under CTH 902710 along with benefit of Notification 243/78-Cus for basic duty and additional duty and Notification 23/91-Cus and Notification 70/90-CE for benefit of auxiliary duty. The benefit of these Notifications were denied to them by the original authority against which respondent filed appeal to the Commissioner (Appeals) and then to the CEGAT. CEGAT vide its order no. 10-11/99B, 219 & 220/00 dated 27.01.2000 had remanded back the case to the Asst. Commissioner with certain direction and then assessment was finalised. Thereafter Bajaj Auto filed a refund claim but their claim was rejected vide Order-in-Original no. S/3-13/92 VAA ACC dated 22.08.2003 on the ground that the claimant of the refund failed to produce the evidence to show that the incidence of duty was not passed on to the consumers. Accordingly, refund sanctioned was credited to the Consumer Welfare Fund. Against the Order-in-Original, appeal was filed before the Commissioner (Appeals), who vide order dated 17.2.2004 set aside the Order-in-Original dated 22.08.2003 and held that the doctrine of unjust enrichment will not be applicable and the order of Adjudicating Authority to credit the amount of refund to the Consumer Welfare Fund could not be sustained. Now the revenue is before us by way of this appeal.
3. The ld. AR submitted that Order-in-Appeal passed by the Commissioner (Appeals) is not sustainable in law as the same has been passed by not considering the binding precedent of the Courts as well as the amendments made in sub-rule (5) of Rule 9B of Central Excise Rules by virtue of which all the cases of refund arising out of finalisation of the provisional assessment are subject to unjust enrichment clause. The ld. AR after taking us through the grounds of appeal relied on the decision of the Hon'ble High Court of Bombay in the case of Bussa Overseas & Properties P. Ltd. 2003 (158) ELT 135 in support of their contention that any refund due consequent to finalisation of provisional assessment is also governed of the unjust enrichment clause. He also submitted that SLP filed against the above judgment was summarily dismissed by the Hon'ble Supreme Court. He also cited the following case laws in support of his contention:
* Sahakari Khand Udyog Mandal Ltd. vs. CCE 2005 (181) ELT 328 (SC) * United Spirit Ltd. vs. CC 2008 (228) ELT 360 (Tri-Mum)
4. On the other hand, ld. counsel for the respondent submitted that Section 18 of the Customs Act, 1962 has been amended with effect from 14.07.2006 specifically providing for application of unjust enrichment in respect of the refund arising out of finalisation. He therefore submits that their refund claim related to the period prior to 14.07.2006 and therefore the sanction of the refund claim is in order and not hit by bar of unjust enrichment. In support of his submission, he cited the following judgements:-
> Oriental Exports vs. CC 2001 (127) ELT 578 (Tri-Del) > A.P. Gas Power Corp.Ltd. 2008 (224) ELT 469 (Tri-Bang) > CC vs. Tulsidas Ramjibhai 2008 (223) ELT 489 (Tri-Ahmd) > CC vs. Hindalco Inds. ltd. 2008 (231) ELT 36 (Guj) > Hindustan Petroleum Corporation Ltd. vs. CC 2009 (245) ELT 268 (Tri-Ahmd) > Bhikkamal Chotelal vs. CC 2009 (245) ELT 268 (Tri-Ahmd) > CCE vs. Paradeep Phosphates Ltd. 2010 (252) ELT 502 (Ori) > CC vs. Hindalco Inds. Ltd. 2010 (262) ELT 106 (Guj) > CC vs. Indian Oil Corporation 2012 (282) ELT 368 (Del) > CC vs. Essar Steel Ltd. 2012 (279) ELT 273 (Tri-Ahmd) > CCE vs. Panasonic Battery India Co. Ltd. 2014 (303) ELT 231 (Tri-LB)
5. The ld. counsel further submitted that this Tribunal in the case of Oriental Exports (supra) has held that in view of the observation made by the Supreme Court in the case of Mafatlal Inds., the bar of unjust enrichment is not applicable to the provisional assessment in terms of Section 18 of the Customs Act, 1962. He also submitted that the Revenue filed appeal before the Supreme Court of India and the Supreme Court while dismissing the appeal has passed the following order:
These appeals have been filed by the Revenue.
The Tribunal, in the impugned order, following its earlier decision, in Messrs Needle Industries India Ltd. v. CCE [1998 (101) E.L.T. 286 (T)] has taken the view that the doctrine of unjust enrichment is not applicable to provisional assessment in terms of Section 18 of the Customs Act which is similar to Rule 9B of the Central Excise Rules.
A two-Judge Bench of this Court in Commissioner of Central Excise, Mumbai v. Allied Photographics India Ltd. [2004 (163) E.L.T. 401 (S.C.) = 2004 (4) SCC 55], noticing the inconsistency, doubted the correctness of two decisions rendered by three-Judge Bench of this Court in, i.e., (i) Sinkhai Synthetics & Chemicals (P) Ltd. v. Commissioner of Central Excise [2002 (9) SCC 416 = 2002 (143) E.L.T. 17] and (ii) Commissioner of Central Excise v. TVS Suzuki Ltd. [2003 (7) SCC 24 = 2003 (156) E.L.T. 161] as contrasted to the Constitution Bench decision in Mafatlal Industries Ltd. v. Union of India [1997 (89) E.L.T. 247 (S.C.) = 1997 (5) SCC 536].
The three-Judge Bench which considered the correctness of the aforesaid two decisions (of three-Judge Bench) has in Commissioner of Central Excise, Mumbai-II v. Allied Photographics India Ltd. [2004 (166) E.L.T. 3 (S.C.) = 2004 (4) SCC 34] held that the judgment in Sinkhai Syntheticss case (supra) was per incuriam [para 14 at page 52] and approved the decision in the later case, i.e., TVS Suzukis case (supra). The three-Judge Bench has also taken the same view, as was taken by the Tribunal, to the effect that the doctrine of unjust enrichment is not applicable to the provisional assessment even after the finalisation thereof.
The point in issue in the present case is, thus, squarely covered by the three-Judge Bench decision in Allied Photographics case [2004 (166) E.L.T. 3 (S.C.) = 2004 (4) SCC 34]. In view of this, the appeals are dismissed and the order passed by the Tribunal is affirmed. No costs. [Commissioner v. Oriental Exports - 2006 (200) E.L.T. A138 (S.C.)] It was further pointed out that in the present case imports were prior to amendment of Section 18 and therefore in view of the amendment with effect from 14.07.2006 it is very clear that the provisions of Section 27 of the Act could not be read into the provisions of Section 18 of the Act, to deny the refund on the ground of unjust enrichment.
6. Ld. counsel further cited a decision of this Tribunal in the case of Hindalco Inds. Ltd. 2007 (215) ELT 113 which has taken into consideration the vital aspect of the amendment of Section 18 and has held that since the requirement of non-passing of amount of duty in the case of provisional assessment was incorporated only with effect from 14.07.2006, any assessment finalised by the authorities would be governed by the provisions of Section 18 as it stood during the relevant period and the assessment finalised by the authorities subsequent to 14.07.2006 and any refund arising out of such assessment will be governed by the provisions with effect from 14.07.2006. The ld. counsel also submitted that the decision of the Hon'ble High Court of Bombay in the case of Bussa Overseas & Properties P. Ltd. (supra) has been rendered prior to the amendment of Section 18 of the Customs Act, 1962. The decision of the Tribunal in the case of Hindalco Inds. (supra) has taken into account the amendment to Section 18 with effect from 14.07.2006. It is pertinent to note that in the case of Hindalco Inds. reported in 2008 (231) ELT 36, the Hon'ble High Court of Gujarat after discussing the various judgments of the Hon'ble Supreme Court has observed in para 14 as under:-
14.?In light of the law laid down in the aforesaid decisions by the Apex Court, the judgment in case of Bussa Overseas & Properties Pvt. Ltd.(supra) rendered by Mumbai High Court cannot be considered to be correct exposition of law, more particularly when the judgment in case of Allied Photographic India Ltd. (supra) which has been rendered subsequently was not considered. It is equally well settled that mere rejection of a petition for Special Leave to Appeal cannot be treated as authoritative pronouncement of law by the Apex Court and therefore reliance placed by the revenue on the note appearing in 2004 (164) E.L.T. A177 cannot assist the revenue.
7. Ld. AR for the Revenue cited the case of United Spirits Ltd. (supra) and submitted that the doctrine of unjust enrichment will be applicable to all cases of refund irrespective of whether amount refunded is duty or otherwise. Ld. counsel for the respondent assessee submitted that the judgment of United Spirits Ltd. (supra) cited by the ld. AR has been recently set aside by the Hon'ble Supreme Court of India in the case of CC (I) vs. Finacord Chemicals (P) Ltd. in Civil Appeal no. 1633-1638 of 2004 dated 08.04.2014. In view of the judgment of the Supreme Court in the above cited case and considering the number of judgements cited by the ld. counsel for the respondent wherein the various Tribunals and the Hon'ble High Court of Gujarat and the Hon'ble Supreme Court has taken a consistent view and has held that bar of unjust enrichment is not attracted upon finalisation of provisional assessment related to the period prior to 14.07.2006.
8. Considering the submission of both sides, we find that in this case, the doctrine of unjust enrichment will not be applicable as the present refund claim relates to the period prior to amendment in Section 18 of the Customs Act, 1962 i.e. 14.07.2006. The judgment in the case of Oriental Exports (supra) relied upon by the respondent and upheld by the Hon'ble Supreme Court, is squarely applicable in the facts and circumstances of the case.
9. In view of the facts and circumstances and the judgment cited at bar, we do not find any valid ground to interfere with the impugned order passed by the Commissioner in favour of the respondent. Consequently, the appeal filed by the department is rejected.
(Pronounced in Court on .) (Raju) Member (Technical) (S.S. Garg) Member (Judicial) //SR 9 c-482-04