Finalized Customs Assessments Cannot Be Reopened for Refund Claims: CESTAT [Read Order]
CESTAT held that refund claims cannot be entertained once a customs assessment has attained finality and remains unchallenged.
![Finalized Customs Assessments Cannot Be Reopened for Refund Claims: CESTAT [Read Order]](https://images.taxscan.in/h-upload/2025/07/21/2067075-customs-assessments-taxscan.webp "Finalized Customs Assessments Cannot Be Reopened for Refund Claims: CESTAT [Read Order]")
The Principal Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), New Delhi, held that refund claims under customs law are non-maintainable where the original assessment has attained finality and has not been challenged through the appellate process. Diamond Mink Blankets Ltd., the appellant, filed a Bill of Entry dated June 11, 2018, which was...
The Principal Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), New Delhi, held that refund claims under customs law are non-maintainable where the original assessment has attained finality and has not been challenged through the appellate process.
Diamond Mink Blankets Ltd., the appellant, filed a Bill of Entry dated June 11, 2018, which was provisionally assessed. The final assessment was completed by order-in-original dated July 1, 2013. The appellant did not challenge the assessment order, allowing it to attain finality.
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In July 2017, nearly four years after the final assessment, the appellant filed a refund application for Rs. 2,22,702, claiming exemption under Notification No. 30/2004-CE dated July 9, 2004. The appellant relied on the Supreme Court’s decision in SRF Ltd. v. Commissioner of Customs, Chennai, which interpreted the exemption notification in a favorable light.
The refund application was rejected by the Deputy Commissioner on the ground that the assessment had not been appealed and had become final. The Commissioner of Customs (Appeals) upheld this rejection, leading the appellant to file the present appeal before CESTAT.
The appellant's counsel argued that it was legally entitled to the benefit of the exemption notification as interpreted in the SRF Ltd. judgment, and that the refund should have been sanctioned accordingly. They argued that denial of the refund amounted to ignoring settled law laid down by the Supreme Court.
The revenue counsel countered that the final assessment could not be reopened indirectly through a refund claim. They relied on the Supreme Court’s decision in ITC Ltd. v. Commissioner of Central Excise, Kolkata-IV, where it was held that refund proceedings are in the nature of execution and cannot modify a final assessment.
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They argued that unless the assessment is appealed and set aside, the duty as assessed remains payable and binding.
The two-member bench comprising Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) observed that the assessment of the Bill of Entry had attained finality and that refund proceedings cannot be used to bypass the appeal mechanism provided under law.
The tribunal clarified that refund claims are not a substitute for an appeal or review of an assessment order. Since the appellant had not disputed the assessment through statutory appeal, the duty was correctly collected as per the final assessment.
The tribunal held that the impugned order was correct in law and did not warrant interference. The appeal was dismissed.
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