Home Case Index All Cases Customs Customs + AT Customs - 2015 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (4) TMI 158 - CESTAT BANGALOREDenial of refund claim - Unjust enrichment - whether the refund amount has to be credited to the Consumer Welfare Fund as per the mandates of Section 27(2) of the Customs Act, 1962 by applying the doctrine of unjust enrichment, or the same is required to be paid to the appellant - Held that:- As per the first proviso to sub-section (2) of the said section, the amount of duty as determined by the statutory authority shall, instead of being credited to the said Fund, be paid to the applicant, if such amount is relatable to the duty paid by the importer, if he had not passed on the incidence of such duty to any other person. Section 28D of the Act contains fiction to the effect that every person who has paid the duty on any goods under the Act shall be deemed to have passed on the full incidence of the duty to the buyer of the goods. This presumption is rebuttable by the person who claims refund of the duties. Therefore every person claiming refund under Section 27 of the Act has to demonstrate by relevant documentary evidence that he is not benefited by unjust enrichment. If the incidence of duty paid is borne by another/any other person, then the person claiming the refund will be unjustly enriched at the cost of other(s). Thus, in such eventuality, the refund amount shall be credited to the said Fund, instead of sanctioning in favour of the applicant. Showing the excess amount of Customs duty in the Balance Sheet for the period 2011-12, that to after rejection of the refund application by the original authority, is not at all relevant since the said amount was admittedly considered in the cost of production for the year 2008-09 and was absorbed in the sale value. Therefore, as per my opinion, the appellant has no locus standi to seek refund from the revenue to be unjustly enriched at the expense of some other person. In absence of any plausible evidence, the certificate furnished by the appellant cannot be relied on to arrive at the conclusion that the refund claimed amount has not been loaded in the costing of the garments sold in the year of import. If the refund is sanctioned to the assessee without proper verification of the books of account, there is every possibility of enrichment by the receipt of a benefit to which he is not entitled to, and accordingly, the advantage of refund benefit at some other's cost and expense will be unjust. Considering the said view, the doctrine of unjust enrichment was incorporated in the Customs statute in the year 1991 consequent to the enactment of the Central Excise and Customs Law (Amendment) Act, 1991. The effect of the amendment is that every assessee seeking refund of any duty to prove that he had not passed on the burden of such duty to any other person. - Thus, it is erroneous to assume that the provisions of Income Tax Act will be applicable for refund of customs duty. Refund amount has not been collected or retained illegally by the exchequer, rather the refund claim has been sanctioned and the amount has been credited to the Consumer Welfare Fund, in absence of any evidence produced by the appellant that the incidence of such duty amount has been borne by it and not passed on to any other person. Even assuming that the amount has been collected without the authority of law, still the doctrine of unjust enrichment is applicable for its refund to the applicant as per the ruling of Hon'ble Supreme Court in the case of Mafatlal Industries Ltd. -Vs. - Union of India, reported in [1996 (12) TMI 50 - SUPREME COURT OF INDIA]. - Decided against assessee.
|