Legal principle

A Chartered Accountant's certificate, consistent with the financial statements showing the duty as receivable, cannot be lightly brushed aside without cogent evidence from Revenue that the certificate is incorrect or that the duty incidence was passed on to buyers.

Court decision

The Tribunal allowed Vivo's appeal and set aside the impugned order dated 05.07.2021 to the extent it directed that the refund be credited to the Consumer Welfare Fund, holding that the appellant had not passed the burden of duty to customers and was entitled to the refund with interest.

Facts

Vivo Mobile India Pvt Ltd, a manufacturer of mobile phones, imported mobile phones for home consumption between 08.06.2015 and 18.06.2015 and paid countervailing duty @ 12.5% on 4 Bills of Entry because the concessional rate of 1% CVD under the Notification dated 17.03.2012 (amended 01.03.2015) was not extended to it. After the Tribunal allowed its appeal and directed de novo consideration, the Deputy Commissioner re-assessed the Bills of Entry in March 2018 charging CVD @ 1%, and Vivo applied on 08.03.2018 for refund of excess duty of Rs. 1,67,79,311/-. The Assistant Commissioner (Refund) sanctioned the refund under section 27(2) of the Customs Act, holding the claim within the one-year limitation and that the unjust-enrichment presumption under section 28D stood rebutted. The Department appealed, and the Commissioner (Appeals) by order dated 05.07.2021 held that although the claim was within time, the bar of unjust enrichment was not crossed, directing the amount to be credited to the Consumer Welfare Fund. Vivo assailed that order before the Tribunal.

Key provisions

• Section 28D, Customs Act, 1962 — Presumption that incidence of duty has been passed on to the buyer
• Section 27(2), Customs Act, 1962 — Claim of refund duty
• Section 28, Customs Act, 1962 — Recovery of duties not levied or not paid or short-levied or short- paid or erroneously refunded
• Section 28C, Customs Act, 1962 — Price of goods to indicate the amount of duty paid thereon
• Section 128A(3), Customs Act, 1962 — Procedure in appeal
• Section 3(1), Customs Tariff Act, 1975 — Levy of additional duty equal to excise duty, sales tax, local taxes and other charges