General Manager, Vehicle Factory vs Cce, Bhopal

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

Customs Appeal Nos. 1676 & 956 of 1988

(Arising out of order-in-appeal No. 5838/87 dated 30.12.1987 passed by the Collector of Customs (Appeal) Bombay).

General Manager, Vehicle Factory Appellant

Vs.

CCE, Bhopal Respondent

Appearance:

Sh. Mukesh Kumar Tiwari, Advocate for the appellant-assessee

Ms. Suchitra Sharma, Commissioner (AR) for the Revenue

Coram:

Honble Mr. Justice G. Raghuram, President

Honble Mr. R. K. Singh, Member (Technical)

Final Order Nos. 53127  53128 / 2015

Per: R. K. Singh:

These Appeals have been filed against orders-in-appeal in terms of which refund claims of the appellant were dismissed on the ground that the assessment / classification of the impugned goods was not challenged and the Assistant Commissioner incharge of refund cannot sit in judgment over the assessment ordered by the Assistant Commissioner who assessed the bill of entry.

2. The appellant has contended that the impugned goods were unmachined cylinder head castings. These castings were unmachined and required further processing (machining) to convert the same into motor vehicle parts (parts ready to fit in) and therefore they were leviable to CVD @ 80 PMT as per Notification No. 62/85 dated 17.03.1985 and as duty was paid at the higher rate, the appellant was entitled to refund. It pleaded that the invoices also described the goods to be cylinder head castings (supplied in unmachined casting condition). It cited the judgment of Delhi High Court in the case of Aman Medical Products vs. CC, Delhi  2010 (250) ELT 30 (Del.).

3. Ld. DR on the other hand stated that when the goods were imported they were classified as motor vehicle parts under Customs Tariff heading 87.04 and assessed as such, inter alia, charging CVD under the then Central Excise Tariff Item 68. Duty was accordingly paid and goods cleared. The Commissioner (Appeals) has specifically noted that the appellant had accepted the goods as components / parts of motor vehicle under CTH 87.04 in which case they cannot be classified as castings for the purpose of classification under C. Excise Tariff. and therefore CVD was correctly paid under C. Excise Tariff Item No. 68. Ld. DR also referred to the judgment of Supreme Court in the case of Priya Blue Industries Ltd. vs. CC (Preventive)  2004 (172) ELT 145 (SC) and Collector of Central Excise, Kanpur vs. Flock (India) Pvt. Ltd.  2000 (120) ELT 285 (SC) to assert that the goods having been assessed as motor vehicle parts and cleared on payment of duty accordingly, it was not open for the appellant to claim refund by disputing the classification when no appeal was filed against the assessment of the goods.

4. We have considered the contentions of both sides. It is a fact that at the goods were assessed as motor vehicle parts under CTH 84.04 and C. Ex. T.I. 68 and the appellant paid duty accordingly without disputing the assessment and cleared the goods. The appellant subsequently submitted refund claims stating that the goods were cylinder head castings in unmachined form and required further processing to convert them into (finished) motor vehicle parts ready to fit in and therefore they should have been classified as castings and not as motor vehicle parts and hence the excise duty paid in excess as a consequence should be refunded. It cited the judgment of Delhi High Court in Aman Medical Products (supra) to plead that the appeal against the assessment is not required to claim the refund. It needs to be pointed out that the goods having been assessed as motor vehicle parts, duty having been paid accordingly and goods having been cleared, it is not open to the appellant to dispute the classification of the impugned goods as determination of classification of such goods requires physical examination thereof. Having accepted the classification, paid duty and cleared the goods, the onus is on the appellant to establish that the classification was not correct and such onus is impossible to be discharged in the absence of the impugned goods. In the case of Aman Medical Products (supra), classification was not under challenge; that was a case of payment of duty without (inadvertently) taking the benefit of a notification the availability of which could be determined without challenge to classification and also without the need to physically examine the goods. It was in those circumstances that the Delhi High Court held that the assessment order need not be challenged for claiming refund. Thus the ratio of the Delhi High Court judgment in case of Aman Medical Products (supra) is not applicable in the present case. Indeed, the ratio of the judgment of Supreme Court in the cases of Flock (India) Pvt. Ltd., (supra) and Priya Blue Industries (supra) that refund claim contrary to assessment order is not maintainable without the order of assessment having been modified in appeal or review is directly applicable to the present case.

5. In the light of the aforesaid analyses, we do not find any merit in these appeals and so the same are dismissed.

(Justice G. Raghuram)

President

(R. K. Singh)

Member (Technical)

Pant