ITC Limited Vs Commissioner of Central Excise (Supreme Court of India)
The Supreme Court considered appeals filed by assessees as well as the Union of India concerning whether a refund application against assessed customs duty can be entertained without first challenging the assessment order in appeal. The Court examined conflicting views taken by different High Courts and the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
The Tribunal, in the case concerning ITC Limited, had held that unless an assessment order was challenged in appeal, no refund application against the assessed duty could be entertained. However, the Delhi and Madras High Courts had taken the view that refund claims under Section 27 of the Customs Act, 1962 could be maintained even without filing appeals against assessed Bills of Entry, especially where there was no dispute or speaking assessment order.
The Supreme Court examined the statutory framework under Sections 17, 27, 28 and 128 of the Customs Act, including amendments introduced by the Finance Act, 2011. The assessees argued that after the 2011 amendment introducing self-assessment, refund applications could be filed directly under Section 27 because the requirement that duty should be paid “in pursuance of an order of assessment” had been removed. It was contended that self-assessment was not equivalent to a formal assessment order and that refund claims should be maintainable even without filing appeals. Reliance was placed on judgments including Micromax Informatics Ltd. and Aman Medical Products Ltd.
