Per Jyoti Balasundaram

The authorities below have sanctioned refund of Rs.2,60,498/- claimed on the ground that the goods cleared under certain Bills of Entry cover parts and accessories of medical equipment attracting nil rate of duty inspite of which they paid CVD @ 16%, but credited the same to the Consumer Welfare Fund as the importer had not discharged the burden cast upon them to show that the incidence of duty on the goods has not been passed on to their customers.

2. We have heard both sides. We find that the material on record clearly shows that the goods were supplied free of cost as warranty replacement. The goods were supplied to customers under delivery notes clearly indicating free warranty replacement. In such a situation the question of passing on the incidence of duty to the customers does not arise and therefore the refund claimed cannot be said to be hit by the bar of unjust enrichment. We, therefore, set aside the impugned order crediting the amount to the Consumer Welfare Fund, holding that the importers are entitled to the refund, and allow the appeal.