COMMISSIONER OF CUSTOMS Vs. ATLAS GRANITES

JUDGEMENT

(1.) This appeal is by the Revenue against an order passed by the Commissioner of Customs (Appeals). The lower appellate authority held that the assessee's refund claim was not time -barred and was liable to be allowed subject to verification of unjust enrichment. Accordingly, it set aside the order of the Deputy Commissioner, who had rejected the refund claim as time -barred.

(2.) In the present appeal, the Revenue has raised a contention that the payment of duty by the assessee was not categorically 'under protest' and, therefore, the claim for refund of the duty filed on 9 -1 -2002 after about 19 months from the date (7 -6 -2000) of payment of duty was barred by limitation in terms of Section 27 of the Customs Act, 1962. The appellant has gone to the extent of taking the view that it is erroneous not to apply the bar of limitation under Section 27 of the Act to a case where the payment of duty was made under protest. Ld. DR has reiterated these grounds of the appeal. Ld. Counsel for the respondents refers to the relevant proceedings of the Jt. DGFT and submits that the duty in question was paid in pursuance of the Jt. DGFT's advice and not on the assessee's own volition. According to Counsel, this fact is apparent on the face of letter dated 10 -10 -2002 of the Jt. DGFT addressed to the Commissioner of Customs. The payment of duty pursuant to the Jt. DGFT's direction should be treated as one made under protest as rightly held by the lower appellate authority, the Counsel argues. After examining the records, f am inclined to accept this argument of the Counsel.

(3.) The payment of duty was in respect of a certain quantity of raw material imported by the party under the DEEC Scheme on the strength of an Advance Licence issued by the DGFT. The importer fulfilled the export obligation under the Scheme by exporting their finished goods against four Shipping Bills. But they could produce Realisation Certificates in respect of two Shipping Bills only. The Jt. DGFT noted the shortfall of realisation of sale proceeds and, in a letter dated 31 -5 -2001, advised the respondents to make up the shortfall or, in the alternative, pay up the customs duty. The respondents opted for payment of duty and effected the payment on 7 -6 -2000, which was intimated to the Jt. DGFT. The latter then acknowledged the fulfillment of export obligation and discharged the importer. The Jt. DGFT, further, in a letter dated 10 -10 -2002 informed the Commissioner of Customs that the respondents had fulfilled their export obligation in respect of the subject imports. The relevant part of this letter, which the Counsel has relied on, is reproduced below : "Although they fulfilled the Export Obligation by exporting goods against 4 shipping bills, they could produce the Bank Realisation Certificates for the Shipping Bills No. 3281 and 5708 only. This office considered the case and issued a letter dated 31 -5 -2000 advising them to regularise the shortfall of US 58,667. Accordingly, the firm paid a sum of Rs. 1,18,270/ - representing the duty plus interest for the shortfall in realization and produced the original receipt No: S405/32/2000/ Cr. 7, dated 7 -6 -2000 and fulfillment letter was issued on 8 -6 -2000." It appears from the above letter of the Jt. DCFT that the respondents had paid the duty and interest on 7 -6 -2000 pursuant to the advice of the former. Such a payment cannot be considered to have been made by the party on their own volition and the same should be considered as payment "under protest" for the purpose of refund. The decision of the Commissioner (Appeals) is based on a correct appreciation of the facts of the case and the same is sustained. The refund is admissible to the respondents, subject, of course, to verification, by the original authority, of unjust enrichment.