Customs, Excise and Gold Tribunal - Tamil Nadu
Psi Data Systems vs Commissioner Of Customs on 4 December, 1996
Equivalent citations: 1997(91)ELT695(TRI-CHENNAI)
ORDER
V.P. Gulati, Vice President
1. The issue in the appeal relates to grant of refund of duty paid for ex-bond clearance. The appellants paid duty in respect of the bonded goods on 22-2-1993 and cleared the goods from the warehouse on 4-3-1993. The relevant date for demand of duty in terms of Section 15(1)(b) read with Section 68 of the Customs Act is the date of actual clearance of the goods from the warehouse. On the date of clearance the rate of duty had come down and the appellant therefore became entitled to the refund of the excess duty paid by them earlier. The refund claim was filed on 1-9-1993. The learned lower authority has taken 24-2-1993 as the relevant date for reckoning the period of limitation of 6 months for filing refund claim and has held that the refund claim should have been filed by 23-8-1993. The appellants' claim has also been held as not sustainable in terms of Section 11B(2) as the appellants have not produced evidence that the duty burden had not been passed on to their customers.
2. The learned Advocate for the appellants pleaded that the appellants imported loaded PCBs for computers and used them captively in the manufacture of computers. He has pleaded that inasmuch as the appellants had captively consumed these PCBs the ratio of the decision of the Hon'ble Bombay High Court in the case of Solar Pesticides v. U.O.I, reported in 1992 (57) E.L.T. 201 would apply. He has also stated that this said ratio has been followed in the case of Vardhaman Spinning & General Mills v. Collector of Customs reported in 1993 (68) E.L.T. 919. He has pleaded that the learned lower authority has not distinguished the ratio of the decision of the Hon'ble Bombay High Court and has merely held that the issue regarding passing on [of] the duty burden to the customers will have to be examined with reference to the nexus of the same with the price of the products sold by the appellants to the consumers. We also observe that the learned lower authority has stated that the appellants have not produced any evidence to his satisfaction that the burden of excess payment has not been passed on to any other person. He has urged there is no findings to the effect that the appellants had sold the PCBs as such. Once the PCBs has been used captively the ratio of the decision of the Hon'ble Bombay High Court in the case of Solar Pesticides would squarely apply to the facts of this case.
3. The learned SDR has pleaded that the judgment of the Hon'ble Bombay High Court in the case of Solar Pesticides has been taken up in appeal before the Hon'ble Supreme Court. He has also urged that the duty element in respect of the goods in question would have been subsequently included in the cost of the end products manufactured by the appellants and for that reason therefore the duty element claimed as refund would have been passed on to the customers.
4. We observe that the Hon'ble Bombay High Court in the case of Solar Pesticides has clearly held that in case any goods are captively consumed by the importer the amended provisions of Section 27 in regard to unjust enrichment would not come into play. So what has to be satisfied by the appellants is that they had used the goods captively and once that is done in terms of the judgment cited supra the amended provisions of Section 27(2) regarding unjust enrichment cannot be invoked against the appellants. We therefore hold that in case the appellants are able to satisfy that they have used the goods captively, the benefit in terms of the judgment of the Bombay High Court will have to be given to the appellants. In regard to the limitation point urged before us, we observe that in the scheme of Customs Act, in the case of warehoused goods at the time of warehousing the Bill of Entry is first assessed and based on the rate of duty applicable at that time when the goods are warehoused, duty payable in respect of the goods is shown on the bonded Bill of Entry and bond in terms of Section 59 based on this duty amount worked out is taken. The actual duty payable however is to be quantified only when the goods are sought to be cleared and the rate of duty payable is with reference to the actual date of clearances of the goods from the warehouse. Therefore the appellants when allowed to clear the goods in terms of Section 68 are required to pay the duty payable under law along with other charges. The date of assessment of this duty for ex-bond clearance purposes and the date of actual removal of the goods may not always be the same. The excess duty payable on the goods therefore gets quantified only with reference to the date of actual clearance of the goods from the warehouse. In the present case the appellants got the ex-bond Bill of Entry assessed on 22-2-1993 and paid the duty and other charges as determined by the authorities, but they came to clear the goods only on 4-3-1993, by then the rate of duty applicable to the goods had changed. The appellants in terms of Section 15(1)(b) was required to pay duty at the rate applicable as on 4-3-1993. The cause of action for refund therefore in the circumstances could only arise on that date. Any assessment done earlier to that could not be taken to be final and in these circumstances we hold that the relevant date for the purpose of reckoning the limitation would be the one when the cause of action for the refund arose. Taking 4-3-1993 as the relevant date, the appellants' refund claim which was received on 2-9-1993 therefore was within time. We therefore set aside the order of the learned lower authority and remand the matter to the learned original authority for passing orders afresh in the light of what we have held above. The appeal is therefore allowed by remand.