Refund of excess additional custom duty paid was rightly sanctioned as authorities were binding by HC order

Principal Commissioner of Customs ACC (Import) Commissionerate Vs Telecare Network (India) Pvt. Ltd. (CESTAT Delhi)

Conclusion: Refund claim seeking refund of the excess additional duty of customs paid during the period 26.03.2015 to 22.06.2015 was rightly sanctioned as there was no error on the part of either the Assistant Commissioner or the Commissioner (Appeals) in sanctioning the refund without considering the limitation as both authorities were bound by the order of the Delhi High Court.

Held: Assessee was a private limited company which imported and sold mobile phones in India. The goods which were imported into India were chargeable to basic customs duty and additional duty of customs levied under Section 3.  Notification No. 12/2012-CE dated 17.03.2012 as amended exempted mobile sets from excise duty in excess of 1% ad valorem subject to the condition that no Cenvat credit was availed on the inputs used in the manufacture of such goods. The Company’s claim of the exemption notification was denied by assessee on the ground that the exemption notification would not apply to imported goods. The company paid the duty under protest. Later, the Supreme Court held in the case of SRF Limited Vs. Commissioner of Customs ² that the exemption notification will apply to additional duty of customs on imported goods also. Thereupon, the company filed a refund claim seeking refund of the excess additional duty of customs paid during the period 26.03.2015 to 22.06.2015 under 103 bills of entry. This application for refund was initially rejected by the Assistant Commissioner by order in original dated 07.03.2017. Aggrieved by the rejection, the company filed a writ petition. It was held that there was no error on the part of either the Assistant Commissioner or the Commissioner (Appeals) in sanctioning the refund without considering the limitation as both authorities were bound by the order of the Delhi High Court. As far as the unjust enrichment was concerned, from the Chartered Accountant’s certificate it was evident that the duty was not passed on and it was treated by the respondent as a receivable. Revenue had 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. M/s Naveen Associates were not the statutory auditors of the respondent. Respondent asserted 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 was no requirement in law that a certificate must be issued only by the statutory auditors.  So long as the certificate was issued by a Chartered Accountant and it was consistent with the accounts such as Balance Sheet and Profit and Loss statement, the certificate deserved to be accepted.

FULL TEXT OF THE CESTAT DELHI ORDER

Revenue filed this appeal to assail the order in appeal dated 21.03.2022 passed by the Commissioner of Customs (Appeals), New Customs House, New Delhi¹ whereby he upheld the order in original dated 14.01.2018 passed by the Assistant Commissioner sanctioning refund to the respondent.

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