A refund of customs duty is subject to the doctrine of unjust enrichment, and where an exporter realizes proceeds in excess of the declared FOB value, the burden lies on the claimant to prove that the duty incidence was not passed on to the buyer.

[ORDER PER: ANGAD PRASAD]

M/s Sesa Strelite Ltd., (hereinafter referred to as appellant) are in appeal against the Order-in-Appeal No. 01/2013 (G)(D) CUS dated 08.08.2013. The learned Commissioner (Appeals), while allowing the Departmental appeal, rejected the refund sanction on the grounds of unjust enrichment.

2. The Adjudicating Authority had sanction refund of Rs. 12,10,234/- to M/s Sesa Goa Ltd., (now M/s Sesa Sterlite Ltd.,). In respect of excise duty paid on export goods. Subsequently, Department has issued Show Cause Notice dated 28.01.2013, proposing recovery of the erroneous refund on the ground that the appellant had realized an amount higher than the FOB value declared, thereby, attracting the doctrine of unjust enrichment.

3. No one was present for the appellant to argue the matter on several hearings in past. No one was present for the appellant even on the date of final hearing. Therefore, we heard the Learned AR and perused the records.

4. Learned AR reiterates the findings given by the Learned Commissioner (Appeals), and also submit that impugned order is based on law and recent judgments of Hon’ble Supreme Court and Tribunals. Learned AR has relied on following decisions:

i) Commissioner of Central Excise, Madras Vs M/s Addison & Co. Ltd., [2016 (8) TMI 1071 – SC]

ii) Sahakari Khand Udyog Mandal Ltd., Vs Commissioner of Central Excise & Customs [2005 (3) TMI 116 – SC]

iii) Mafatlal Industries Ltd., Vs Union of India [1996 (12) TMI 50 – SC]

iv) Sagar Cements Ltd., Vs Pr. Commissioner of Central Tax Rangareddy – GST [2024 (7) TMI 1071 – CESTAT Hyderabad]

v) Charbhai Bedi Works, Shaz Enterprises, Arshad and Co. Nav Udyog Beedi Works and Hyderabad Beedi Manufactures Vs CC & CE, lHyderabad – I, [2017 (9) TMI 869 – CESTAT Hyderabad]

vi) CCE & ST, Hyderabad – I Vs Sirpur Paper Mills Ltd., [2017 (9) TMI 1490 – CESTAT Hyderabad]

vii) Lorenzo Bestonso Vs Commissioner of Customs, JNCH [2016 (9) TMI 725 – CESTAT Mumbai]

5. The short issue involved is whether the refund sanction to the appellant is hit by the doctrine of unjust enrichment, in view of excise realisation over the declared FOB value. In this regard it is important to mention the relevant findings of impugned order which is as thus:

“6. At the outset, I find that the disputed shipping bill was reassessed on 25.07.2011 as per the directions given vide Order-in-Appeal No.3/2009 (G) CUS. dated 30.04.2009 passed by the Commissioner (Appeals), Guntur. As seen from the correspondence file C,No.VIII/20/02/2011-R of the Refund Sanctioning authority, I find that the respondent have filed a refund claim on 16.08.2011 arising on account of reassessment of shipping bill no.43/08-09 dated 15.07.2011. The said shipping bill was assessed provisionally and duty of Rs. 1,38,91,038/- paid by the respondent on 14.07.2008. The shipping bill was reassessed and the duty payable was worked out to Rs. 1,26,80,805/- vide speaking order dated 25.07.2011 and 14.10.2011. Consequent upon the reassessment, the respondent filed the refund claim and the instant refund was sanctioned by the refund sanctioning authority (i.e. AC, Customs, Krishnapatnam Port basing on the certificate dated 08.12.2011 given by M/s S.J.Thaly & Co, Chartered Accountants, Goa stating that the company has recovered only the price of the export goods from the overseas customers, as per the terms and conditions of respective export contract and accordingly, the incidence of the duty in respect of the above referred export is borne by the company and has not been recovered from the overseas customer.

7. In this contex