By TIOL News Service

MUMBAI, NOV 23, 2016: THIS is a Revenue appeal.

The respondent is a unit of Department of Space, Government of India and registered as a scientific institution with Department of Scientific & Industrial Research.

They imported 1 nos. '50 cm Multi-application Solar Telescope (MAST) with additional components' and cleared it on payment of duty of Rs.1,35,96,202 on 22 nd February 2013 by availing benefit of notification no. 51/96-Cus dated 23rd July 1996. Realizing that they were entitled to exemption under notification no. 24/2007-Cus dated 1 st March 2007 and notification no. 16/2007-CE dated 1 st March 2007, an application for refund of Rs.61,12,187 paid as additional duty was filed.

The claim was rejected by the AC following which an appeal was filed before Commissioner of Customs (Appeals) who set aside the rejection and allowed the refund.

Aggrieved, Revenue is before the CESTAT.

The AR submitted that recourse to refund without appeal against assessment is not in accordance with the decision of the Supreme Court in Flock (India) Pvt. Ltd. - 2002-TIOL-208-SC-CX and in Priya Blue Industries Ltd.- 2004-TIOL-78-SC-CUS. It is further informed that the reliance placed on the decision in Aman Medical Products Ltd. - 2009-TIOL-566-HC-DEL-CUS may not be sound as against this decision the SLP filed has been admitted by the Supreme Court.

The respondent relies on the following decisions in support of their claim - Hero Cycles Ltd. - 2009-TIOL-317-HC-MUM-CUS, Aman Medical Products - 2009-TIOL-566-HC-DEL-CUS, Andrew Telecom India P. Ltd. - 2014-TIOL-251-CESTAT-MUM.

The Bench inter alia observed -

++ In a regime of self- assessment, the scope for grievance and filing of appeal is non-existent. Nor can the assessing officer be compelled by assessee to resort to re-assessment to enable filing of appeal.

++ It has been made clear (in Hero Cycles Ltd. - 2009-TIOL-317-HC-MUM-CUS that even if the benefit of notification has not been claimed, responsibility is cast on the tax authority in an assessment. More important is the observation that writ jurisdiction can be invoked to allow refunds without filing an appeal even if the law has been interpreted to require an appeal to seek refund of excess duty.

++ In the matter before us, filing of an appeal is questionable owing to self-assessment. At the same time, the self-assessment regime prevents the officer from extending the benefit of notification that importer was entitled objected to. In the circumstances, the law laid down in re Flock (India) Pvt Ltd and Priya Blue Industries Ltd. is not applicable.

++ The High Court of Delhi in re Aman Medical Products has elucidated that 'duty having been borne' is a qualification in section27 of Customs Act,1962 in addition to 'duty paid by him' which was the rationale for the decision in re Flock (India) Pvt Ltd and re Priya Blue Industries.

Noting that the said judgment in Aman Medical Products has not been stayed, the Bench opined that there was no reason to hold that the first appellate authority had erred.

The appeal filed by the Revenue was dismissed.

(See 2016-TIOL-3037-CESTAT-MUM)