Nokia India Sales Pvt. Ltd. Vs Commissioner of Customs, Airport & Air Cargo Commissionerate (CESTAT Bangalore)
The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Bangalore Bench, has allowed appeals filed by Nokia India Sales Pvt. Ltd., overturning lower authorities’ decisions and clearing the way for the company to receive refunds of Additional Duty of Customs (CVD) paid on imported mobile phones.
The dispute centred on refund claims for CVD paid by Nokia during periods in late 2014 and 2015. Nokia had initially paid the CVD without availing a concessional rate available under Notification No. 12/2012-CE. This was because the company believed it did not satisfy a specific condition of the notification at the time.
However, a subsequent ruling by the Hon’ble Supreme Court in the case of SRF Limited Vs. CC [2015(318) ELT 603 (SC)] clarified the eligibility criteria for the said notification, deciding the issue in favour of assessees like Nokia. Following this Supreme Court judgment, Nokia filed refund claims for the difference between the full CVD paid and the concessional rate they were now deemed eligible for.
The refund claims, however, faced rejection at the initial adjudication stage and subsequently by the Commissioner of Customs (Appeals). While the Commissioner (Appeals) agreed that the refund claims were substantively in order based on the Supreme Court’s ruling, the rejection was upheld primarily on the ground of ‘unjust enrichment’. This principle dictates that a refund can only be granted if the claimant proves they have not passed on the burden of the duty sought to be refunded to their customers.
Aggrieved by the Commissioner (Appeals)’s decision, Nokia approached the CESTAT, Bangalore. Three separate appeals covering different periods of import were heard together by the tribunal due to the common issues involved.
The appellant, Nokia India Sales Pvt. Ltd., raised three primary points before the CESTAT:
