ESCORTS CLASS LTD. Vs. CC

JUDGEMENT

(1.) THE brief facts of this case are as follows: - - The appellants, engaged in the manufacture of Combined Harvesters, imported from Germany several consignments of component parts for the final product.

(2.) The relevant Bills of Entry were provisionally assessed by the jurisdictional Assistant Commissioner of Customs. At that stage, an amount of Rs. 3,61,658/ - being prescribed percentage of the invoice value of the imported goods was deposited by the importers pending determination of assessable value of the goods by Special Valuation Branch. The provisional assessments were finalised, later on, as per Order dated 11.7.1995 by the Assistant Commissioner (SVB). This final assessment was not challenged by the assessees as it was in acceptance of the gross invoice value of the imports. According to the appellants, they became entitled to refund of the aforesaid extra amount of deposit pursuant to the final order of assessment. Therefore, they filed a refund claim with the Assistant Commissioner on 9.5.1996. This claim was allegedly not received by the Assistant Commissioner, who advised the party to file fresh refund claim. The appellants, therefore, filed a fresh refund claim on 8.8.1997. This claim was rejected by the Assistant Commissioner as time -barred under Section 27 of the Customs Act. The appeal filed against such rejection of refund claim was also rejected by the Commissioner (Appeals), who upheld the order of the Assistant Commissioner. Hence the present appeal of the assessee before the Tribunal.

(3.) LD . Advocate Sh. M.M. Mathur for the appellants submits that the lower authorities rejected the appellant's claim for refund solely on the ground of time bar without going into the merits of the claim. According to Ld. Counsel, as long as the appellants did not challenge the final assessment and also did not seek to re -agitate any assessment -related issues in their refund claim, they were entitled to suo motu refund of the amount without any formal claim for such refund. He has raised this contention on the basis of the provisions of Section 18(2)(a) of the Customs Act. Ld. Counsel also relies on the Hon'ble Supreme Court's ruling in Mafatlal Industries v. Union of India [1997 (68) ECR 209 (SC)]. He further relies on the Tribunal's decision in the case of Alcatel Modi Net Works Systems v. CC, New Delhi [1999 (82) ECR 813]. In Mafatlal Industries (supra), Supreme Court was considering the question whether a formal refund claim was required to be filed under Section 11B of the Central Excise Act pursuant to a final order of assessment under Sub -Rule 5 of Rule 9B of the Central Excise Rules. The Court held that any refund consequent upon adjustments under Sub -Rule 5 of Rule 9B would not be governed by Section 11B of the Act. Ld. Counsel draws parallel between this position considered by the apex Court and the present appellant's position under the Customs Act. In other words, his submission is that any refund consequent upon adjustments under Section 18(2) of the Customs Act cannot be governed by Section 27 of the said Act and, therefore, the provisions of limitation contained in the latter Section of the Act would not affect any such refund. The ruling of the Supreme Court in Mafatlal Industries was followed by the Tribunal in Alcatel Modi Net Works Systems (supra) wherein the question arose whether a refund consequent on finalisation of provisional assessment under the Customs Act had to be allowed suo motu or not. The Tribunal answered the question in the affirmative by following the aforesaid ruling of the Supreme Court under the Central Excise Act. Ld. Counsel, therefore, prays for allowing this appeal and for a remand of the matter to the adjudicating authority for fresh decision on the appellant's refund claim on its merits.