UNNATI CORPORATION Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are a partnership firm and carrying on business as Manufacturers, Processors and Suppliers in Fibre Glass Cloth which is woven from Glass Fibre Yarn. The petitioners had imported Glass Fibre Yarn from, Marglass, England and Itoman, Japan from January 1979 onwards, and the Customs duty as well as the additional duty/countervailing duty referred to in Section 3 of the Customs Tariff Act, 1975 was duly paid. Glass Fibre Yarn falls under Item 22-F of the First Schedule to the Central Excises & Salt Act. The petitioner had imported between the period from January 1979 to January 1981, 21 consignments of Fibre Glass Yarn and had paid additional duty/countervailing duty amount to Rs. 2,34,848.49.

(2.) In July 1981, the Government of India, Ministry of Finance, in the case of M/s. Montex Glass Fibre Industries Pvt. Limited and M/s. Mica Glass Industries Limited held that Glass Fibre Yarn falling Under Central Excise Tariff No. 22 F(1) was yarn spun-wholly out of glass fibres and that the said glass yarn filament was covered by Exemption Notification dated March 16, 1976. The Notification exempts payment of countervailing duty in respect of the import of Glass Fibre Yarn. After the decision of the Government of India in revisions, the petitioners filed 21 refund applications before the Assistant Collector of Customs, Refund Department, claiming refund of amount of additional duty. The applications were rejected by the Assistant Collector on the ground that the applications were time barred under Section 27 of the Customs Act. The appeals preferred by the petitioners before the Collector of Customs (Appeals) Bombay met with the same fate by order dated July 30, 1982. The petitioners have approached this Court by filing present petition under Article 226 of the Constitution of India to challenge the legality of the action of the authorities below in dismissing the refund applications on the ground of limitation under Section 27 of the Act.

(3.) Shri Joshi, learned counsel appearing on behalf of the petitioners, submitted that the decision of the authorities below cannot be sustained in view of several decisions of this Court holding that the provisions of Section 27(1) of the Customs Act have no application where duty is paid under mistake of law. The learned counsel urged that as the duty was recovered by the respondents without any authority of law, the same will have to be refunded without bar of Section 27(1) of the Act. The submission of the learned counsel is correct and deserves acceptance. Shri Rege, learned counsel appearing on behalf of the respondents, had to concede that the petitioners are entitled to the relief in view of several decisions of this Court.