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TMI Blog2025 (3) TMI 858X X X X Extracts X X X X X X X X Extracts X X X X ..... etween 08.06.2015 and 18.06.2015 for home consumption and paid countervailing duty [CVD] @ 12.5% on the 4 Bills of Entry, as the benefit of the Notification dated 17.03.2012, subsequently amended on 01.03.2015 [the Notification], extending concessional rate of 1% CVD on imports of mobiles phone for home consumption was not extended to the appellant for the said import. 3. The appellant filed an appeal against assessment of the Bills of Entry before the Commissioner (Appeals) with a prayer that the benefit of concessional rate of CVD should also be granted to the appellant in terms of the judgment of the Supreme Court in SRF Ltd. vs. Commissioner of Customs, Chennai [2015 (31B) E.L.T. 607 (SC)]. The Commissioner (Appeals) rejected the appeal filed by the appellant by an order dated 29.06.2016. This order was assailed by the appellant by filing Customs Appeal before the Tribunal. The Tribunal, by a decision dated 05.01.2017, allowed the appeal and directed the adjudicating authority to examine the claim of the appellant denovo within a period of four months after providing an opportunity of hearing to the appellant. Thereafter, an order was passed by the Deputy Commissioner in Marc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner (Refund) on these two issues are as follows: "At the outset, it is essential to find out whether the refund claim submitted by the importer is well within time. The party has filed refund claim application on 13.03.2018 against the excess duty paid by them. Bill of entries has been re-assessed on 09.02.2018. Therefore, the refund claim has been filed well within the time limit of one year from the date of re-assessment. So, the refund claim is not hit by bar of limitation. Hence refund claim is not barred by limitation, as per provision to section 27(1) of the Customs Act, 1962. I further find that the party has submitted their relevant books of accounts and audited financial statement for the year 2015-16 in which the duty recoverable under the head "current assests sub-group (note 13) short-term loans & advances" in "balances with statutory/government authorities". I found that the burden of CVD has not been passed on by the importer to their customers directly or indirectly, I have already taken note of the facts that the importer has submitted a Chartered Accountant's Certificate dated 09.04.2018 issued by D K Munjal & Associates (Firm Reg. No. 023194N) to the effec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - was included in said stated amount of Rs. 17,38,94,156/- shown in the Balance Sheet for Financal Year 2015-16. The Respondent has also not adduced any evidence in this regard in their response to appeal filed by the Department. The entire Balance Sheet of Financial Year 2015-16 does not contain any breakup or details of Rs. 17,38,94,156/- from which it can be concluded that the refund amount of Rs. 1,67,79,311/- was part of said amount. 5.4.1. I further note that the Refund Sanctioning Authority relied upon certificate dated 09.04.2018 of Sh. D.K. Munjal, Charted Accountant and Proprietor of M/s. D.K. Munjal & Associates. First of all, the said Charted Accountant was not the firm which audited the balance sheet of Finance Year 2015-16. Further the certificate dated 09.04.2018 is not in respect of impugned refund of Rs. 1,67,79,311/- which is related of finally assessed bills of entry while the certificate dated 09.04.2018 referred to provisionally assessed bills of entry. 5.4.2 Respondent Importer submitted that the certificate is in respect of total amount including provisionally assessed BOEs and reassessed BOEs which were initially self-assessed. In this connection, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the appellant. However, the order passed by the Commissioner (Appeals) completely ignores Note 9 of the Balance Sheet that explicitly shows "Customs Duty Receivable" of Rs. 17,38,94,156/- from the customs for the year ended 31.03.2016. Learned counsel, therefore, submitted that an adverse conclusion could not have been drawn by the Commissioner (Appeals) merely for the reason that there was no separate mention of the amount of refund of the relevant Bills of Entry in the Balance Sheet; (iii) It is a settled law that when the customs duty is reflected to be receivable in the Books of Accounts, the burden of duty would not be passed to the customers and would be borne by the assessee itself. In this regard, reliance has been placed on the following decisions: (a) Bridgestone India Pvt. Ltd. vs. CGST CC and CCE, Indore [Excise Appeal No. 50610 of 2018 decided on 30.07.2018]; (b) Commissioner of Cus., Tuticorin vs. Virudhunagar Textile Mills Ltd. [2008 (230) E.L.T. 411 (Mad.)]; (c) Commissioner of C. Ex. & Cus. vs. Manisha Pharmoplast Pvt. Ltd. [2008 (222) E.L.T. 511 (Guj.)]; (d) IOC Ltd. vs. Commissioner of Central Excise, Meerut [2016 (335) E.L.T. 313 (Tri. - All.) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noticed that the appellant had submitted relevant Books of Account and audited Financial Statement for the year 2015-16 in which the duty recoverable was shown under the head "Current Assests Sub-Group (Note 13) Short-term Loans & Advances" in "Balances with Statutory/government authorities". The Assistant Commissioner (Refund) also noted that the appellant had submitted a Chartered Accountant Certificate dated 09.04.2018 certifying that the burden of duty under the refund claim had not been passed on to the buyers and the amount that was claimed was shown in the Books of Account/Balance Sheet as amount recoverable from the customs. The Assistant Commissioner (Refund) further recorded a finding that the appellant had discharged the statutory obligation cast upon him of rebutting the presumption of unjust enrichment and, therefore, the burden of duty had not been passed to the buyers. It is for this reason that the Assistant Commissioner (Refund) found as a fact that the appellant had discharged the burden contemplated under section 28D of the Customs Act. 20. The Commissioner (Appeals), however, did not agree with the finding recorded by the Assistant Commissioner (Refund) t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OMSOEVER IT MAY CONCERN Based on the examination of Financial Statements, details and documents produced before us and as per the information and explanation provided to us of M/s vivo Mobile India Private Limited ("the Company") having its registered office at 10th & 11th Floor, Palm Springs Plaza (Complex) Village Wazirabad, Sector-54 Gurugram, Haryana-122003, we hereby confirm that the Company having IEC No. 0514053739, has imported mobile phones and paid Custom Duty (CVD) on the basis of provisional bills of entry. At the time of filing the provisional bills of entry, the Company paid CVD @ 12.5%. Now these provisional bills of entry have been finalized/reassessed by the Hon'ble Deputy Commissioner of Customs Group VA and the Duty payable has been assessed @ 1% Only. This resulted into excess duty paid by the Company and same is refundable to the Company. Further the aforementioned amount has been accounted as "Custom Duty Receivable" which is reflected under the major head of "Short Term Loans & Advances" in the Balance Sheet. Also the Company has not passed the burden of excess duty to any other entity or Individual. This certificate is issued on the request of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 43,32,900.00 12.06.2015 3,46,632.00 39,86,268.00 4. 9614231 dt. 18.06.2015 59,57,250.00 19.06.2015 4,76,580.00 54,80,670.00 Total 1,82,38,382.50 14,59,070.60 1,67,88,778.00 (b) The abovesaid amount of CVD and Cess was paid by Vivo at 12.5% even when the benefit of Serial No. 263A of Notification No. 12/2012-CE dated 17.03.2012 was available to them which grants the benefit of reduced rate of CVD at 1%. Accordingly, the excess amounts paid by Vivo were refundable to Vivo. On this basis, the above Bills of Entry have also been reassessed by the Hon'ble Deputy Commissioner of Customs and communicated vide letter C. No. VIII/12/Acc-Imports/Gr.-VA/2444/2018 as part of a group of 27 Bills of Entry which were reassessed. (c) Vivo has considered the abovesaid amount of Rs. 1,67,88,778 as part of "Customs Duty Receivable" under the major head of "Loans and Advances" in the Financial Statements of Vivo for the financial year ended 31st March, 2016 which totals to Rs. 17,38,94,156/-. (Annexure-1). (d) Vivo has not considered the abovesaid amount of Rs. 1,67,88,778 as part of their expense as evident from the books of accounts and docume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... placed reliance upon this Note. However, the Commissioner (Appeals) observed that it cannot be concluded from this Note that the amount of Rs. 1,67,79,311/- was included in the amount of Rs. 17,38,94,156/- shown as "customs duty receivable". The Chartered Accountant Certificate dated 09.04.2018 clearly mentions that at the time of filing the provisional Bills of Entry, the appellant had paid CVD @ 12.5% and the said Bills of Entry have been finalized/re-assessed, holding that the appellant was required to pay duty only @ 1%. The Certificate also mentions that the appellant had paid excess duty which was required to be refunded. The Certificate also notes that this amount has been accounted as customs duty receivable in the Balance Sheet. A conjoint reading of Note 9 and the Certificate would clearly show that Rs. 1,67,79,311/- was receivable by the appellant from the customs department. If the Commissioner (Appeals) was not to place reliance upon the Financial Statement and the Certificate issued by the Chartered Accountant as it did not specifically refer to the amount of Rs. 1,67,79,311/-, the appellant could have been asked to explain the position but that was not done and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner of Customs vs. Telecare Network (India) Pvt. Ltd. [(2023) 13 Centax 8 (Del.)], the Delhi High Court approved the following findings recorded by the Tribunal: "8. Dealing with the objection of unjust enrichment, the CESTAT has in paragraph 18 held as follows:- "18. ***** As far as the unjust enrichment is concerned, from the Chartered Accountant's certificate it is evident that the duty was not passed on and it was treated by the respondent as a receivable. Revenue has not produced even a shred of evidence either to establish that the Chartered Accountant's certificate was wrong or to establish that the duty was indeed passed on to the buyers. Learned special counsel also asserted that M/s Naveen Associates were not the statutory auditors of the respondent. Learned counsel for the respondent asserts that they were their statutory auditors during the relevant period. In the absence of any evidence by the Revenue on this count, the submission by the respondent that during the relevant period, M/s Naveen Associates were their Chartered Accountants must be accepted. Even otherwise, there is no requirement in law that a certificate must be issued only by the statutory audit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excise sales tax authorities". The certificate of the cost accountant indicated that the differential custom duty was included in this receivables account. I do not find any evidence to the contrary in the records before me. Evidently, the amount is added in the books of accounts as "amount receivables" and not as "cost of raw materials" and it could not have been passed on indirectly to the customers. In view of the above, I find that the appellant is entitled to refund of the differential duty and their claim is not hit by the clause of unjust enrichment." (emphasis supplied) 34. In Principal Commissioner of Customs, ACC (Import) Commissionerate vs. Telecare Network (India) Pvt. Ltd. [(2023) 13 Centax 7 (Tri. - Del.)], the Tribunal observed as follows: "16. When goods are manufactured or imported land sold there are two ways of treating the cost of the goods - either take the cost of the goods plus all taxes as the cost of the goods and then fix the sale price or take the cost of the goods and taxes but exclude such taxes and duties which are disputed and then decide the sale price. In the first case, the amount incurred as duty will be added to the cost of the goods which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... larified from the appellant but that was not done. 37. The decision of the Tribunal in Kohinoor India, on which reliance has been placed by the learned authorized representative appearing for the department, holds that mere production of a Certificate of the Chartered Accountant does not ipso facto grant refund to the respondent until material is produced by the assessee to show that burden of duty has not been passed on to the buyers. This decision would, therefore, not help the department. 38. In view of the aforesaid factual position and the decisions referred to above, it is evident that the appellant had not passed the burden of duty to the customers in respect of the duty paid on the 4 Bills of Entry and was shown as recoverable from the customs department. 39. The Commissioner (Appeals), therefore, committed an illegality in holding that the appellant had not established that the burden of duty had not been passed to the customers. 40. The impugned order dated 05.07.2021, to the extent it holds that refund amount should be credited in the Consumer Welfare Fund, therefore, deserves to be set aside and is set aside. The appellant would be entitled to refund of the amou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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