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Hindustan Construction Co. Ltd. Versus Commissioner of Customs (I) , Mumbai

Refund claim - excess custom duty paid - revenue deposit to the Government of India - provisional assessment - classification of imported machinery - entry 8207.19 or entry 8431.43 - doctrine of unjust enrichment - whether the refund be allowed keeping in mind the principles of unjust enrichment w.e.f. 13/7/2006? - Held that: - provisional assessments are governed by the provisions of Section 18 of the Customs Act, 1962 and during the relevant period, the section specifically mandated for recove .....

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ut of finalization of provisional assessment will apply only from 13.7.2006. - Also a certificate issued by a Chartered Accountant in July 2005, who, after verifying the books of accounts and records and other relevant records of the appellant, had certified that the amount for which refund has been claimed is not charged to profit and loss account as an expense, the said amount is shown as a revenue deposit and was not recovered from the Municipal Corporation of Greater Mumbai or any other .....

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ount which has been held in favour of the appellant-assessee by the adjudicating authority. 4. The appellant herein imported cutter head with cutters for tunnel boring machine and filed bill of entry on 2.3.2001 seeking classification of the product under heading 8431.43, whereas the Revenue was of the view that the imported goods are classifiable under 8207.19. The bill of entry was provisionally assessed and a revenue deposit of ₹ 40,95,032/- was directed to be paid, which was paid. The .....

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s are not expensed out and are shown in the balance sheet as receivable, held in favour of the assessee and directed for the refund of the said amount. Aggrieved by the said decision, Revenue filed an appeal before the first appellate authority. The first appellate authority, after considering the submissions made before him relying upon the judgment of the Hon ble High Court of Bombay in the case of Bussa Overseas and Properties Pvt. Ltd. vs. UOI 2003 (158) ELT 135 (Bom.), held that the refund .....

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essed by the authorities in 2004 and held that the appellant has paid excess duty as revenue deposit. It is his submission that Section 27 which is relied upon by the first appellate authority, is incorrect as during the relevant period, Section 18 did not have the clause of unjust enrichment. He would submit that the provisions of Section 18(3)(4) were introduced w.e.f. 13.7.2006. He would submit that the question of bar of unjust enrichment in the case of provisional assessment being finalized .....

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It is his submission that once the law is settled that prior to 13.7.2006 in the case of provisional assessment, question of unjust enrichment does not arise, the first appellate authority was not correct in relying upon the judgment of Bussa Overseas & Properties Pvt. Ltd. (supra) as this specific point of amendment to Section 18 was not discussed and was not before the Hon ble High Court of Bombay. It is also his submission that the appellant had produced positive evidence in the form of .....

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ch has been settled by the apex court in the case of Sahakari Khand Udyog Mandal Ltd. vs. CCE 2005-TIOL-48-SC-CX-LB. It is his submission that once it is the law which has been settled, doctrine of unjust enrichment needs to be satisfied in favour of an assessee or importer before the refund is sanctioned. He would rely upon the Revenue s submission in the case of Bussa Overseas and Properties Pvt. Ltd. in paragraphs 26, 29, 30 and 33. 7. On perusal of the records, I find that the entire issue i .....

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fically mandated for recovery of short paid and refund of excess paid on finalization of the provisionally assessed bill of entry. The said section did not have a clause of unjust enrichment has to be satisfied before the refund is sanctioned. On 13.7.2006, an amendment was carried out, by which it mandated in Section 18(3) & (4) that any refund that arises due to finalization of provisional assessment has to also satisfy the doctrine of unjust enrichment. In my considered view, this amendme .....

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