TMI Blog2010 (6) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... in Appeal case No. C/468/2003-NB (B) disposed on 1-6-2004 [2004 (173) E.L.T. 276 (Tribunal)] the matter was taken up for hearing. 2.Following two questions of law were before the Hon'ble High Court for answer : "1. Whether the authority letter dated 8-11-2000 in favour of Shri Chetan Kothari could be nullified or rendered nugatory merely on an earlier statement rendered by him in 1944 when neither the letter dated 8-11-2000 was withdrawn but supported with the affidavit of Shri Bhavesh Gandhi and the refund was to be issued in the name of the Appellant and not in the name of Chetan Kothari? 2. Whether the theory of unjust enrichment will apply when the goods at the time of clearance were neither charged to duty and no duty at the time of clearance (1992 to 1994) was collected from the buyer and the payment for which refund is sought was made between September to November 1997 when the investigation was going on?" 3. So far as the first question is concerned, Hon'ble Court did not find any fault with the authorisation given by the company. 4. So far as the second question on unjust enrichment is concerned, relevant part of the order of the Hon'ble ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... countered the above argument by referring to the relevant challans, whereunder the amounts had been paid by Shri Bhavesh Gandhi qua partner of the firm. We have also perused copies of these challans available on record, which describe the payments as "payments towards the Customs duty evaded on import cargo cleared against Bond Bills of Entry and sold in the local market". Relying on the Tribunal's decision in Sun Export Pvt. Ltd. v. CCE [2003 (156) E.L.T. 801], DR has also contended that the refund claim filed by a person who had not paid the duty cannot be allowed. DR has further contended that the bar of unjust enrichment is applicable in respect of past period also. In this connection, he has relied on the Supreme Court's decision in Union of India v. Jain Spinners Ltd. [1992 (61) E.L.T. 321 (S.C.)]. Learned SDR has also relied on the Supreme Court's judgment in Mafatlal Industries Ltd. v. U.O.I. [1997 (89) E.L.T. 247 (S.C.)] and the Bombay High Court's decision in Bussa Overseas and Properties Pvt. Ltd. v. U.O.I [2003 (158) E.L.T. 135 (Bom.)], to argue that all claims of refund of duty should pass the test of unjust enrichment." Submissions of Appellant 6.Ld. Counsel appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he duty amount involved was paid in respect of the goods which were bonded in bonded warehouse and for the diversion of the goods from that place, the duty became dischargeable. Since duty was paid after clearance that shall not be hit by doctrine of unjust enrichment. Similarly, any payment made to Revenue over and above the show cause notice demand also is barred by this doctrine. Similarly any amount paid against export need not undergo test of unjust enrichment. So also the proceeding was time barred. Doctrine of unjust enrichment need not test the payment of duty made voluntarily when the invoice does not show duty element. Invoices were also certified by Chartered Accountant. If at all the test of unjust enrichment shall apply; that shall apply to the amount of Rs. 21,99,059/- covered by two shipping bills only which were held by the Tribunal as time barred. Since refund arises, interest shall also be payable to the appellant. Submissions of Revenue 7. Ld. JCDR appearing on behalf of the Revenue submitted that the impugned goods were imported during July 1992 to March, 1994 and were warehoused on 8-6-93. Those were physically removed from warehouse on 26-7-93 withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of its documents by revenue having been discarded on the basis of materials available on record, the appellant has no claim before Tribunal. Further Xerox copy is not at all a primary evidence to entertain refund. Finding and Decision of Tribunal 8. Record reveals that the refund application for Rs. 63,08,933/- was made by the appellant on 12-9-2000 in pursuance of Tribunal's Final Order No. A/963-966/99 dated 29-10-99. This refund related to the adjudication made against the appellant on 5-7-01. Consequent upon search and seizure operation conducted on 10-9-1997, certain deposits were made by the appellants during the period September 1997 to November, 1997 in respect of the imported goods kept in warehouse but were removed without payment of duty. Ld. Adjudicating authority finding that the appellant contravened the provisions of Section 27(1)(i) (ii) and Section (1)(b) of Customs Act, 1962 due to improper removal of imported goods and failed to provide evidence to prove that it had not passed on duty incidence to the buyers, issued show cause notice dated 16-5-2001 to the appellant asking the reason why refund application made them shall not be rejected and also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investigation mentioned about the recovery of invoices. 12. Ld. Adjudicating authority also found that there were discrepancies in the individual invoices/bills and there was mismatching of the description of goods imported with the invoices produced. This comes out from para 25 appearing at page 9-12 of the adjudicating order. That authority in para 26 of the order also noticed that the invoices did not bear any serial number and were also not issued from the same invoice book. There was no availability of sales invoices in the course of search. Nor also the appellant adduced any evidence of the invoice in the course of search. The appellant adduced only Xerox copies of the documents with reply to show cause notice dated 21-5-2001 alongwith affidavit dated 19-6-2001 after 8 (eight years) of removal of goods warehoused under bond. When the ld. Adjudicating authority found that there was mismatching of the description of the goods in invoices with the goods imported, he inferred that the invoices were liable to be discarded being irrelevant and did not pertain to the matter in controversy. So also he noticed that the invoices were issued prior to 26-7-93 i.e. day on which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng incidence of duty itself. Thus, there was an unjust enrichment made by the appellant at the cost of revenue as held even in first appeal, which called for rejection of refund application of the Appellant upholding adjudication on that count. 15. When the first Appellate Order did not go in favour of the appellant, the appellant again challenged the issue of unjust enrichment before Tribunal in appeal case No. C/468/03/NB (B). Such appeal was disposed on 1-6-04 holding that the applicant making the refund not being competent to make application, presumption of unjust enrichment stood unrebutted for which the claim was held to be hit by bar of unjust enrichment. While deciding this issue the Tribunal in para 6 of its order recorded that certain amount was paid after clearance of the goods and prior to issuance of show cause notice. 16. Being unsuccessful before Tribunal, the appellant went in appeal to the Hon'ble High Court of Bombay in Customs Appeal No. 2/05 Hon'ble High Court held that authorisation was not faulty and the decision on unjust enrichment having been made by Tribunal questioning locus standi of the applicant for which, such issue was required to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, such failure before 3 successive stages of the proceedings shows that the appellant has not come out with clean hands to buttress its claim. So also failure to produce seizure memo discards custody thereof by the Investigating Agency. 19.Xerox copy of the invoice No. 401069 dated 8th December, 1992, Xerox copy of bill No. DMC/SDMS/MFG/01/92-93 and Xerox copy of Bill No. SSC/SKMS/MFG/04/92-93 dated 14-1-93 were produced by the appellant to show that there was no realisation of duty through these documents. All these Xerox copies relate to pre-clearance period. The appellant has also failed to explain on the mismatched description of goods before the learned Authorities below. Therefore, vague pleas of Appellant at a subsequent stage are untenable. Xerox copies not being primary evidence is not entertainable when the appellant's plea that its documents are in the custody of Revenue was rightly discarded by Authorities below. 20. Ld. Counsel relied on the decision of Apex Court in the case of M/s. Collector v. Metro Tyres Ltd. - 1997 (94) E.L.T. A51 (S.C.). In this decision, Tribunal's conclusion that burden to prove that incidence of duty was passed on to the customer wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar of unjust enrichment was not invoked. But the appellant has neither produced invoice in original before the Authorities below nor proved its bona fide through its modus operandi was bound to be denied of the refund by those Authorities and the appellant does not get any benefit from the citation made. 23. The appellant further placed reliance on the decision of Apex Court in the case of Delhi Cloth and General Mills Co. Ltd., etc. v. The Commissioner of Sales Tax, Indore in Civil Appeal Nos. 1272-1273 of 1967 and No. 2453 of 1968 dated 28th July, 1971 to claim that when duty was not collected separately there was no unjust enrichment. The Apex Court in that case dealing with the sales tax matter arising under Madhya Pradesh General Sales Tax Act, 1958 held that "unless the price of an article is controlled, it is always open to the buyer and seller to agree upon the price to be payable. While doing so, it is open to the dealer to include in the price the tax payable by him to the Government. If he does so he cannot be said to be collecting the tax payable by him from his buyers. The levy and collection of tax is regulated by law and not by contract." When the present app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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