COMMR. OF CUS., KANDLA Vs. HINDUSTAN ZINC LTD.

JUDGEMENT

(1.) BEING aggrieved with the order passed by Commissioner (Appeals) vide which he has held that the refund of customs duty arising out the provisional assessment is not hit by the bar of unjust enrichment, Revenue has filed the present appeal. It stands relied upon the decision of the Honble Supreme Court in the case of UOI v. Raj Industries [2000 (120) E.L.T. 50 (S.C.) that the principles of unjust enrichment shall apply in all proceedings. It stands further contented before use that as per provisions of Rule 9B(5), the assessee becomes entitled to refund of finalization of assessment but such refund is not to be granted without testing the principles of unjust enrichment. The above grounds stand reiterated by Shri M.M. Mathkar, ld. JDR appearing for the Revenue.

(2.) SHRI B.L. Narsimhan, ld. Advocate appearing for the respondents draws our attention to various decisions of the Tribunal laying down that prior to amendment of Section 18 of the Customs Act w.e.f. 13 -7 -2006, the doctrine of unjust enrichment cannot be applied to the refund arising consequent to finalization of provisional assessment under Section 18 of the Customs Act, 1962. Specific attention has been drawn to the Tribunals decision in the case of M/s. A.P. Power Corporation Ltd. v. CC, Visakhapatnam [2008 (85) RLT 552 (CESTAT -Bangalore)], wherein after allowing rectification of mistake application, the appeal was allowed. In the case of M/s. Timken India Ltd. v. CC, Kolkata [2007 (217) E.L.T. 197 (Tri. -Kolkata)], it was held that refund arising out of the final assessment order under Section 18 (2) of the Customs Act, 1962 will not attract the doctrine on unjust enrichment. Further, in the case of CC, Jamnagar v. Tulsidas Ramjibhai [2008 (223) E.L.T. 489 (Tri. -Ahmd.)], it was held that in respect of refund clains upon finalization of provisional assessment relating to the period prior to 14 -7 -2006, principles of unjust enrichment will not get attracted. To the similar effect is another decision of the Tribunal in the case of CC, Kandla v. Care India, vide its order No. A/1431 and 1432/WZB/AHD/07 dated 8 -6 -2007 and in the case of CC, Ahmedabad v. Hindalco Industries Ltd. [2007 (215) E.L.T. 113 ( Tri. -Ahmd.)].

(3.) HOWEVER , we find that the Tribunal in the case of CC, Ahmedabad v. Reliance Industries Ltd. [2007 (219) E.L.T. 225 (Tri. -Mumbai)] has held that irrespective of the amendment of the provisions of Section 18, refund of customs duty would be subjected to principles of unjust enrichment. For arriving at the above conclusion, the Bench has taken note of the Honble Supreme Courts latest decision in the case of M/s. Sahakari Khand Udyog Mandal Ltd. v. Commissioner [2005 (181) E.L.T. 328 (S.C.)] laying down that doctrine of unjust enrichment is based on equity and irrespective of applicability of Section 11B, the doctrine can be invoked to deny the benefit to which person is not otherwise entitled. Section 11B of the Central Excise Act or similar provision merely gives legislative recognition to this doctrine. As such by referring to the Honble Bombay High Courts decision in the case of M/s. Bussa Overseas and Properties Pvt. Ltd., which stands confirmed by the Honble Supreme Court when the appeal against the same was rejected as reported in 2004 (164) E.L.T. A177 (S.C.), Tribunal held that all types of refund are liable to doctrine of unjust enrichment and allowed the Revenues appeal to that extent.