whether in the absence of any challenge to the order of assessment in appeal, any refund application against the assessed duty can be entertained? = The scope of the provisions of refund under Section 27 cannot be enlarged. It has to be read with the provisions of Sections 17, 18, 28 and 128. - When we consider the overall effect of the provisions prior to amendment and post­amendment under Finance Act, 2011, we are of the opinion that the claim for refund cannot be entertained unless the order of assessment or self­assessment is modified in accordance with law by taking recourse to the appropriate proceedings and it would not be within the ken of Section 27 to set aside the order of self­assessment and reassess the duty for making refund; and in case any person is aggrieved by any order which would include self­assessment, he has to get the order modified under Section 128 or under other relevant provisions of the Act. Resultantly, we find that the order(s) passed by Customs, Excise, and Service Tax Appellate Tribunal is to be upheld and that passed by the High Courts of Delhi and Madras to the contrary, deserves to be and are hereby set aside. We order accordingly. We hold that the applications for refund were not maintainable. The appeals are accordingly disposed of. Parties to bear their own costs as incurred.

1
 REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 293­294 OF 2009
ITC LIMITED … APPELLANT(S)
VERSUS
COMMISSIONER OF CENTRAL EXCISE,
KOLKATA IV … RESPONDENT(S)
WITH
CIVIL APPEAL NO.2960 OF 2010
CIVIL APPEAL NO.5878 OF 2011
CIVIL APPEAL NO.310 OF 2011
CIVIL APPEAL NOS.4432­4434 OF 2011
CIVIL APPEAL NO.6407 OF 2011
CIVIL APPEAL NOS.1575­1582 OF 2012
CIVIL APPEAL NO.1585 OF 2012
CIVIL APPEAL NO.1571 OF 2012
CIVIL APPEAL NO.5490 OF 2011
CIVIL APPEAL NO.5491 OF 2011
CIVIL APPEAL NO.5489 OF 2011
CIVIL APPEAL NO.6054 OF 2011
CIVIL APPEAL NO.7710 OF 2014
2
CIVIL APPEAL NO.59­60 OF 2016
CIVIL APPEAL NO.96 OF 2016
CIVIL APPEAL NOS. 7384­86 OF 2019
(@ SPECIAL LEAVE PETITION (C) NOS.16114­16116 OF 2017)
CIVIL APPEAL NO. 7387 OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.25193 OF 2016)
CIVIL APPEAL NO. 7388  OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.26530 OF 2016)
CIVIL APPEAL NO. 20852 OF 2017
CIVIL APPEAL NO. 7389  OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.4294 OF 2017)
CIVIL APPEAL NO.  7391  OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.6269 OF 2017)
CIVIL APPEAL NO. 7392  OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.15175 OF 2017)
CIVIL APPEAL NO.18765 OF 2017
CIVIL APPEAL NO.  7393 OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.31561 OF 2017)
CIVIL APPEAL NOS. 7394­96 OF 2019
(@ SPECIAL LEAVE PETITION (C) NOS.5040­5042 OF 2018)
CIVIL APPEAL NO.  7397  OF 2019
(@ SPECIAL LEAVE PETITION (C) NO.15363 OF 2018)
CIVIL APPEAL NO.10082 OF 2018
3
J U D G M E N T
ARUN MISHRA, J.
1. These appeals have been preferred by the assessees as well as by the
Union of India aggrieved by the judgment and order passed by the High
Courts and Customs, Excise and Service Tax Appellate Tribunal, Kolkata
(for short referred to as “the Tribunal”).
2. The question involved in these appeals is whether in the absence of
any challenge to the order of assessment in appeal, any refund application
against the assessed duty can be entertained? 
3. The tribunal has in the case of ITC Limited opined that unless the
order of assessment is appealed, no refund application against the assessed
duty can be entertained.  On the other hand, in the cases in which Union of
India or the Department has come up in appeal, the High Court of Delhi
framed question of law as “whether non filing of appeal against the assessed
Bill   of  Entry  in  which  there   was   no  lis  between   the  importer  and  the
Revenue at the time of payment of duty will deprive the importer of his right
to file refund claim under Section 27 of the Customs Act, 1962 (for short,
“the 1962 Act”)”?
4. While interpreting provisions contained in Section 27 of the Act, the
High Court has opined that when there is no assessment order for being
challenged in appeal, which is passed under Section 27(1)(i) of the Act,
because there is no contest or  lis  and hence no adversarial assessment
4
order, the cases would be covered by the provision of Section 27(i) (ii) and
refund applications can be maintained by the assessee even in the absence
of filing appeals against the assessed bill of entry. The High Court of Madras
has opined similarly.
5. In the case of  Union of India & Ors. vs. Micromax Informatics Ltd.,
reported in (2016) 335 ELT 446 (Del) the High Court of Delhi has opined
that an important change has been made in Section 27 of the Customs Act
in that a person can now claim refund of any duty or interest as long as
such duty or interest was paid or borne by such person. The conditionality
of such payment having been made pursuant to an order of assessment
does not exist. It has also been observed that once an application is made
under Section 27(1) of the Act, it is incumbent on the authority concerned
to make an order under Section 27(2) determining if any duty or interest as
claimed   is   refundable   to   the   applicant.   It   has   been   opined   that   under
Section 27 of the Act as amended, it is not open to an authority to refuse to
consider the application for refund only because no appeal has been filed
against the assessment order, if there is one.
6. The High court has further opined that although under Section 27(2)
of the Act, the word ‘assessment’ includes a self­assessment, the clearance
of the goods upon filing of the bills of entry and payment of duty is not per
se an assessment order in the context of Section 27(1) (i) as it stood prior to
8.4.2011, particularly, if such duty has not been paid under protest.  In any
event, after 8.4.2011, as long as customs duty or interest has been borne by
5
a person, a claim for refund made by such person under Section 27(1) of
the Act will have to be entertained and an order passed thereon by the
authority concerned, even where an order of assessment may not have been
reviewed or modified in appeal.   Reliance has been placed on the case of
Aman Medical Products Limited v. Commissioner of Customs,  Delhi, 2010
(250) ELT 30 (Del).
7. The   facts   of   the   case   of   ITC   Limited   are   that   the   appellants
manufacture   paper   from   both   conventional   and   unconventional   raw
materials.  In the course of the manufacturing activity, waste paper/ broke
arises which are recycled in the manufacturing process by making pulp.
Sometimes, after entry in  the RG 1 register, the paper is found to  be
defective   and   incapable   of   being   sold   and   as   such   is   required   to   be
reprocessed and if that is not possible, then it is rejected and has to be repulped and recycled. 
8. The appellant had been paying duty on paper cleared from its factory.
The   rate   of   duty   of   paper   manufactured   from   conventional   and
unconventional   raw   material   differed.   The   appellants   availed   exemption
under Notification No.67/95­CE dated March 16, 1995 as to the duty in
respect of waste paper/ fresh broke.  By Notification No.6/2000­CE dated
March 1, 2000 complete exemption was granted in respect of paper up to
the   specified   quantitative   limit   manufactured   from   unconventional   raw
materials.   Upon   receipt   of   a   letter   dated   March   30,   2001   from   the
6
Superintendent of Central Excise, the Appellant examined the matter and
realized   the   mistake   committed   by   it   in   availing   the   exemption   under
Notification No.67.95­CE in respect of waste paper/ broke utilized in the
manufacture   of   paper   cleared   at   ‘nil'   rate   of   duty   under   Notification
No.6/2000­CE.   From May 2001 onwards, the appellant stopped availing
the exemption and started payment of duty on waste paper/broke.
9. The relevant period involved in the appeal  i.e.  July 2001 to March
2002.   The Appellant's assessments for this period were provisional and
these entries were finalized on 30.01.2003.   The provisional assessment
order was passed on 1.3.2002.  The appellant has claimed that at the time
of the said final assessment order dated 30.01.2003, it was not aware of the
notification No.10/96­CE or the said circular dated 1.3.2001 and as such,
no claim thereunder was made by it till that time nor was any such claim so
considered or decided in the said final assessment order.
10. On July 18, 2003, the appellant filed a refund claim for an amount of
Rs.28,73,120/­ in respect of the duty paid on the said waste paper/ broke
during the period from July 2001 to March 2002.  The said refund claim
was filed under section 11(b) of the Central Excise Act, 1944 (for short,
referred to as “the 1944 Act”) and within the statutory period of limitation.
11. A show cause notice was issued as to why the said claim be not
rejected to which a reply was filed.  The assessment committee rejected the
said claim.  The Commissioner of Appeals dismissed the appeal. Thereafter,
successive appeal was preferred before the Tribunal.   The Tribunal has
7
rejected the refund claim of the appellant. Hence, the appeal has been
preferred under section 35(b) of the 1944 Act.
12. In the case of Union of India & Ors. v. Micromax Informatics Ltd., the
respondents (i.e. Micromax Informatics Ltd.) had imported mobile handsets
including cellular phones during the period 30.07.2014 to 29.8.2014.   At
the time of customs clearance, they paid Additional Customs Duty (CVD)
under Section 3(1) of the Customs Tariff Act, 1975 at the rate of 6 %.  In all,
the imports bills of entry were self­assessed by the respondents in terms of
the Self­Assessment Scheme under section 17 of the Act and were thus
finally   assessed.   This   Court   in  M/s.   SRF   v.   Commissioner   of   Customs,
Chennai 2015 [318] ELT 607 (SC) held that for quantification of CVD in case
of an article that has been imported, it has to be presumed that the said
imported article has been manufactured in India and then the amount of
excise duty leviable thereon has to be ascertained for determining the extent
of exemption from payment of CVD to which the importer would be entitled.
The respondent had filed the refund claim of Rs.35.89 crores for duty totally
paid under the self­assessed bills of entry, under section 27 of the 1962 Act
in   the   Air   Cargo   Export   Commissionerate,   claiming   a   refund   of   the
Additional   Customs   Duty   (CVD)   in   view   of   Serial   Number   263   A   and
Condition No.16 of notification No.12/2002­Ex. Dated 17.03.2012 and for
the said Condition No.16, mobile handsets were chargeable to a duty of 1%
if no CENVAT credit had been availed by the importer.   The Micromax
claimed that they had  made excess  payment while  complying with  the
8
condition No.16 of the aforesaid notification.   They claimed the refund of
deferential duty of 5%.  The Assistant Commissioner (Refunds) rejected all
the   claims   as   not   maintainable   in   the   absence   of   evidence   of   excess
payment of duty.  He further held that the Bills of Entry had already been
assessed and there were assessment orders which could only be reviewed or
modified   in   appeal.   It   was   also   observed   that   the   respondent   failed   to
submit any reassessment order or speaking order under section 17(5) of the
1962 Act and that it was beyond the jurisdiction of the Refund Branch to
decide the issue on merits.  The officer considering a refund claim cannot
sit in appeal over an assessment made by a competent officer.  The High
Court held that self­assessment is not an assessment order  per se  and
allowed the writ petition. Hence the appeal by the Union of India.
13. In Commissioner of Customs, New Delhi v. Aman Medical Products Ltd.,
the respondents had imported cannula for the purpose of manufacture of
injection needles. At the time of filing of bills of entry, the respondent could
not indicate the benefits available under notification No.6/2002 Cus, dated
1.3.2002 which provided a concessional rate of duty on the imported goods.
The bills of entry were assessed finally. Subsequently, the respondent filed
an application for refund.   The refund claim was rejected by the Deputy
Commissioner.     The   respondent   preferred   an   appeal   before   the
Commissioner (Appeals) for grant of refund of excess duty paid by them.
The appeal was allowed by the Commissioner of Appeals.  The Department
filed an appeal before the Tribunal.   The Tribunal observed that refund
9
claim cannot be adjudicated on merits.   The respondent – Aman Medical
Products Ltd filed a writ petition before the High Court.  The writ petition
has been allowed.
14. Shri P. Chidambaram, learned senior counsel has taken us through
the definition of the ‘assessment’ as prevailed under the 1962 Act and the
amended definition under the Act, assessment w.e.f. 8.4.2011, Finance Act,
2011, Section 17 and Section 27 as amended by the Finance Act, 2011.  It
was urged by learned senior counsel that prior to the amendment by the
Finance Act, 2011, the scheme of assessment under section 17 of the
Customs Act was such that once a bill of entry was filed, examination and
testing of the imported goods were done by the proper officer.  Thereafter,
an   order   of   assessment   was   passed   after   the   physical   examination.
Accordingly, section 27 of the Customs Act provided that claim for refund to
be made by any person who had (a) paid duty in pursuance of an order of
assessment or (b) a person who had borne the duty.  Earlier, there was a
necessity for an order of assessment by a proper officer under section 17 of
the Customs Act.  After the amendment to the Act in 2011, there is no need
to get the assessment of bill of exchange done for claiming a refund of
excess duty paid under Section 27 of the Act, as now the bill of entry is to
be   self­assessed   by   the   importer   or   exporter   and   will   be   subject   to
verification.  Further, under section 17(4) of the Customs Act if it is found
that self­assessment of duty has not been done correctly by an importer or
exporter the proper officer, may re­assess the duty. In case of re­assessment
10
within fifteen days from the date of re­assessment under section 17(5), a
speaking order has to be passed by the proper officer. In the case of reassessment done under section 17(4), it is only in these circumstances an
order is passed.   If no order of assessment is passed in the case of selfassessment, the refund application can lie.   It was urged that section 27
has also been amended by way of amendment by the Finance Act, 2011. An
application for refund of duty and the requirement of order of assessment
that was requisite before the amendment has now been expressly removed.
It would be a retrograde step to interpret the amended provision otherwise
and to deny the refund claim which is not adjudicatory when the bill of
entry has been passed.  In the case of self­assessment, the duty paid under
a mistake can always be claimed without filing an appeal and in that event
concerned officer has to look into the matter whether the claim for refund
was justified.
15. Reliance has been placed on behalf of the assessee on SRF Limited vs.
Commissioner of Customs (supra).  It is not necessary to pass an order of
reassessment or speaking order under the amended provisions of section
17.  The decision in Priya Blue Industries v. Commissioner of Customs 2004
(172)   E.L.T.   145   (SC)   is   based   upon   the   unamended   provisions,   thus,
cannot hold the field and is inapplicable in view of the amendment made in
the provisions.  Under section 17(1) of the amended provisions, bills of entry
have to be self­assessed by importer or exporter.  The verification of the selfassessment has now been made optional.  The self­assessment is not to be
11
disturbed unless there is a verification required by the proper officer and for
this purpose, he may examine or test goods or part thereof.
16. It was further urged on behalf of the assessee that amended section
17 and section 27 are to be read together.  By amended section 27 it is now
provided that an application for refund of duty will be made by any person
who has paid the duty or by any person who has borne the duty.  Earlier
refund could be claimed by the person who has paid the duty.  Under the
post   amendment   provision   the   words   “in   pursuance   to   the   order   of
assessment” have been deleted and a refund claim is maintainable by the
assessee in case duty has been “paid by him”.  The legislative intent is clear.
Now the order of assessment has been made irrelevant and a re­assessment
to an order is no longer a pre­requisite for maintaining a refund claim. Now
under   the   scheme   of   self­assessment,   there   would   be   no   order   of
assessment by the proper officer. 
17. It was further urged on behalf of the assessee that section 27 cannot
be   rendered   otiose   or   redundant.     Section   27   does   not   contain   any
stipulation which may suggest that refunds can be filed only after the Bill of
Entry   has   been   appealed   against.   In   the   absence   of   such   a   statutory
condition, a restriction on refund claim cannot be imported into the statute.
Taxing statute has to be strictly interpreted and there is no room to infer
any intendment thereof as held by this  Court in Commissioner of Wealth
Tax, Gujarat III Ahmedabad v. Ellis Bridge Gymkhana, (1998) 1 SCC 384.
Reliance has also been placed on the decision of this Court in Maharashtra
12
State Financial Corporation v. Jaycee Drugs and Pharmaceuticals (P.) Ltd.
(1991) 1 SCC 637, O.P. Singla & Anr. v. Union of India & Ors., (1984) 4 SCC
450, and Union of India v. Popular Construction Co., (2001) 8 SCC 470.
18. It was also urged that section 27 is a remedy available to the assessee
for the refund of duty paid and section 28 is a remedy available to the
Department   on   the   recovery   of   duty   not   levied   and   short   levied   or
erroneously levied. Both the remedies can be availed without filing appeals.
It was further urged that no appeal can be filed under section 128 of the
Customs Act against the bill of entry. As the scheme of assessment under
Section 17 of the Customs Act is that of self­assessment and only when
such   a   self­assessment   is   disputed   by   the   proper   officer,   an   order   of
assessment   is   passed   then   he   may   appeal   to   the   relevant   appellate
authority within 60 days of the communication of the order.  It is only in a
situation where speaking order is passed then the assessee is required to
file an appeal.  Unless a speaking order of assessment is passed, no appeal
can lie and the only option for refund of duty paid is to file a refund claim.
The bill of entry is merely stamped to allow clearance of the goods. No
reasons are provided in the bill of entry on account of which it can be
regarded as an order which can be subjected to appeal under section 128 of
the Customs Act. The judgment of this Court in Commissioner of Customs v.
Sayed Ali (265) ELT 17 (SC) is not relevant.  The said judgment was passed
in respect of section 28 of the Customs Act.
19. On behalf of the Union of India/Department, it is contended that self­
13
assessment is an assessment.   It is not open to the proper officer after
accepting the self­assessment to entertain a claim for refund in the absence
of the self­assessment being questioned in the appeal.   The direction to
reassess the bill of entry after the expiry of more than a year cannot be
ordered.  Reliance has been placed on Collector of Central Excise, Kanpur v.
Flock (India) Pvt. Ltd., 2000 (120) ELT 285 (SC).   In the instant case, the
bills of entry were filed and they were self­assessed.  It is an assessment
under the Act and in case benefit of notification has not been claimed, in
the absence of challenge to assessment of bills of entry by way of filing the
appeal, the benefit of notification cannot be claimed.   An application for
refund is not maintainable in view of the law laid down by this Court in
Flock (India) Pvt. Ltd. (supra) and Priya Blue Industries  (supra).   Once the
self­assessment/assessment attains finality and has not been questioned, it
cannot be reopened at any point of time.   The refund claim is not an
appellate proceeding. The officer considering a refund claim cannot sit in
appeal   over   an   assessment   made   by   a   competent   officer.     The   officer
considering the refund claim cannot also review an assessment order.  Even
after the amendment is made in 2011, the conditionality of payment having
been made pursuant to an order of assessment continue to exist.  As the
self­assessment of bills of entry is an order of assessment per se, unless the
order of assessment passed under section 2(2) of the Act is appealed before
Commissioner   of   Appeals   for   modification   no   claim   for   refund   can   be
entertained.  The provision of section 128 cannot be rendered otiose.  The
14
amendment has been made in order to simplify the procedure but the legal
effect of the self­assessment is that of assessment. While processing selfassessment some exercise has to be done.  Once it is accepted, it becomes
an order of assessment.
20. Right to appeal is available to any person i.e. to the department as
well as to importer/exporter against an order of self­assessment.  Until and
unless assessment order is modified and a fresh order of assessment is
passed and duty redetermined, the refund cannot be granted by way of
refund application.   The refund authorities cannot take over the role of
Assessing Officer. The officer considering refund claim cannot reassess an
assessment order.   An assessment order has to be questioned within the
stipulated   period   of   limitation.     The   refund   application   cannot   be
entertained directly under section 27 unless the order of assessment is
appealed against and is modified.
21. The   first   question   for   consideration   is   whether   the   assessment
includes self­assessment also. Prior to the amendment by the Finance Act,
2011 the assessment had been defined in Section 2(2) thus:
“2(2)   “assessment”   includes   provisional   assessment,
reassessment and any order of assessment in which the duty
assessed is nil;”
22. After the amendment of Section 2(2) made by the Finance Act, 2011
the definition of ‘assessment’ reads thus:
15
  "2(2)   "assessment"   includes   provisional  assessment,   selfassessment, reassessment and any assessment in which the
duty assessed is nil;"
23. It   is   apparent   from   the   amended   definition   that   self­assessment,
provisional assessment, re­assessment and any assessment in which the
duty   assessed   is   nil,   is   an   assessment.   Assessment   includes   selfassessment, when the provision of self­assessment has been incorporated
in Section 17(1), and corresponding change has been made in the definition
of assessment in Section 2(2). Earlier the word self­assessment was not
included in the definition of assessment.
24. The assessment of duty was provided in section 17 of the unamended
Act prior to 2011. Pre­amended section 17 of the Customs Act is extracted
hereunder:
“17. Assessment of duty.—(1)   After an importer has
entered any imported goods under section 46 or an exporter
has entered any export goods under section 50 the imported
goods or the export goods, as the case may be, or such part
thereof as may be necessary may, without undue delay, be
examined and tested by the proper officer.
(2)   After such examination and testing, the duty, if any,
leviable on such goods shall, save as otherwise provided in
section 85, be assessed.
(3)  For the purpose of assessing duty under sub­section (2),
the proper officer may require the importer, exporter or any
other person to produce any contract, broker’s note, policy of
insurance, catalogue or other document whereby the duty
leviable on the imported goods or export goods, as the case
may be, can be ascertained, and to furnish any information
required for such ascertainment which is in his power to
produce or furnish, and thereupon the importer, exporter or
16
such other person shall produce such document and furnish
such information.
(4)   Notwithstanding   anything   contained   in   this   section,
imported   goods   or   export   goods   may,   prior   to   the
examination or testing thereof, be permitted by the proper
officer to be assessed to duty on the basis of the statements
made   in   the   entry   relating   thereto   and   the   documents
produced and the information furnished under sub­section
(3); but if it is found subsequently on examination or testing
of the goods or otherwise that any statement in such entry or
document or any information so furnished is not true in
respect of any matter relevant to the assessment, the goods
may, without prejudice to any other action which may be
taken under this Act, be re­assessed to duty.
(5)   Where   any   assessment   done   under   sub­section   (2)   is
contrary to the claim of the importer or exporter regarding
valuation of goods, classification, exemption or concessions
of duty availed consequent to any notification therefor under
this Act, and in cases other than those where the importer or
the exporter, as the case may be, confirms his acceptance of
the said assessment in writing, the proper officer shall pass a
speaking   order   within   fifteen   days   from   the   date   of
assessment of the bill of entry or the shipping bill, as the
case may be.”
25. Section 17 as amended by Finance Act, 2011 is extracted hereunder:
“17. Assessment of duty. — (1) An  importer  entering
any   imported   goods   under   section   46,  or   an   exporter
entering any export goods under section 50, shall save as
otherwise provided in section 85, self­assess the duty, if any,
leviable on such goods.
(2) The proper officer may verify the self­assessment of such
goods and for this purpose,  examine or test any imported
goods   or   export   goods  or   such   part   thereof   as   may   be
necessary.
[(3)     For verification of self­assessment under sub­section (2),
the proper officer may require the importer, exporter or any
other   person  to   produce   any   document   or   information,
whereby the duty leviable on the imported goods or export
goods,   as   the   case   may   be,   can   be   ascertained   and
thereupon, the importer, exporter or such other person shall
produce such document or furnish such information.]
17
(4) Where it is found on verification, examination or testing of
the goods or otherwise that the self­assessment is not done
correctly, the proper officer  may, without prejudice to any
other action which may be taken under this Act,  re­assess
the duty leviable on such goods.
(5) Where any  re­assessment done under sub­section (4) is
contrary   to   the   self­assessment   done  by   the   importer   or
exporter regarding   valuation   of   goods,   classification,
exemption or concessions of duty availed consequent to any
notification issued therefor under this Act and in cases other
than those where the importer or exporter, as the case may
be, confirms his acceptance of the said  re­assessment in
writing, the proper officer shall pass a speaking order on the
re­assessment,   within   fifteen   days   from   the   date   of   reassessment of the bill of entry or the shipping bill, as the
case may be.
(6)  Where   re­assessment   has   not   been   done   or   a
speaking order has not been passed on re­assessment,  the
proper   officer   may   audit   the   assessment   of   duty   of   the
imported   goods   or   export   goods   at   his   office   or   at   the
premises of the importer or exporter, as may be expedient, in
such manner as may be prescribed.
Explanation.—For   the   removal   of   doubts,   it   is   hereby
declared that in cases where an importer has entered any
imported goods under section 46 or an exporter has entered
any export goods under section 50 before the date on which
the Finance Bill, 2011 receives the assent of the President,
such imported goods or export goods shall continue to be
governed   by   the   provisions   of   section   17   as   it   stood
immediately   before   the   date   on   which   such   assent   is
received.]”
(emphasis supplied)   
26. Section 27 deals with a claim for refund of duty. Provision of section 27
which   prevailed   before   amendment   by   Finance   Act,   2011   is   extracted
hereunder:
“27. (1) Any person claiming refund of any duty­­­
(i) paid by him in pursuance of an order of assessment; or
(ii) borne by him,
may   make   an   application   for   refund   of   such   duty   and
interest,   if   any,   paid   on   such   duty   to   the   Assistant
18
Commissioner   of   Customs   or   Deputy   Commissioner   of
Customs­
(a) in the case of any import made by any individual for his
personal   use   or   by   Government   or   by   any   educational,
research   or   charitable   institution   or   hospital,   before   the
expiry of one year ;
(b) in any other case, before the expiry of six months,
from the date of payment of duty and interest, if any, paid on
such duty, in such form and manner as may be specified in
the regulations made in this behalf and the application shall
be   accompanied   by   such   documentary   or   other   evidence
(including the documents referred to in section 28C) as the
applicant may furnish to establish that the amount of duty
and interest, if any, paid on such duty in relation to which
such refund is claimed was collected from, or paid by, him
and the incidence of such duty and interest, if any, paid on
such duty had not been passed on by him to any other
person :
Provided that where an application for refund has been made
before   the   commencement   of   the   Central   Excises   and
Customs   Laws   (Amendment)   Act,   1991,   such   application
shall be deemed to have been made under this sub­section
and the same shall be dealt with in accordance with the
provisions of sub­section (2):
Provided   further   that   the   limitation   of   one   year   or   six
months, as the case may be, shall not apply where any duty
and interest, if any, paid on such duty has been paid under
protest:
Provided also that in the case of goods which are exempt
from payment of duty by a special order issued under subsection (2) of section 25, the limitation of one year or six
months, as the case may be, shall be computed from the
date of issue of such order.
[Provided also that where the duty becomes refundable as a
consequence of judgment, decree, order or direction of the
appellate   authority,   Appellate   Tribunal   or   any   court,   the
limitation of one year or six months, as the case may be,
shall be computed from the date of such judgment, decree,
order or direction.
Explanation I.­For the purposes of this sub­section, "the date
of payment of duty and interest, if any, paid on such duty",
in relation to a person, other than the importer, shall be
construed as "the date of purchase of goods" by such person.
Explanation II.­Where any duty is paid provisionally under
section 18, the limitation of one year or six months, as the
case may be, shall be computed from the date of adjustment
of duty after the final assessment thereof.
(emphasis supplied)”
19
27. The   provision   of   Section   27   of   the   Customs   Act   as   amended   by
Finance Act, 2011 is extracted hereunder:
“27.   Claim   for   refund   of   duty.   ­­  (1)   Any   person
claiming refund of any duty or interest, ­­
(a) paid by him; or
(b) borne by him,
may make an application in such form and manner as may
be prescribed for such refund to the Assistant Commissioner
of Customs or Deputy Commissioner of Customs, before the
expiry of one year, from the date of payment of such duty or
interest:
Provided that where an application for refund has been made
before the date on which the Finance Bill, 2011 receives the
assent of the President, such application shall be deemed to
have been made under sub­section (1), as it stood before the
date on which the Finance Bill, 2011 receives the assent of
the President and the same shall be dealt with in accordance
with the provisions of sub­section (2):
Provided further that the limitation of one year shall not
apply   where   any   duty   or   interest   has   been   paid   under
protest.
Provided also that where the amount of refund claimed is
less   than   rupees   one   hundred,   the   same   shall   not   be
refunded.
Explanation. ­­ For the purposes of this sub­section, “the
date of payment of duty or interest'' in relation to a person,
other than the importer, shall be construed as “the date of
purchase of goods” by such person.
(1A)   The   application   under   sub­section   (1)   shall   be
accompanied   by   such   documentary   or   other   evidence
(including the documents referred to in section 28C) as the
applicant may furnish to establish that the amount of duty
or interest, in relation to which such refund is claimed was
collected from, or paid by, him and  the incidence of such
duty or interest, has not been passed on by him to any other
person.
(1B) Save as otherwise provided in this section, the period of
limitation of one year shall be computed in the following
manner, namely: ­­
(a) in the case of goods which are exempt from payment of
duty   by   a   special   order   issued  under   sub­section   (2)   of
section 25, the limitation of one year shall be computed from
the date of issue of such order;
(b) where the duty becomes refundable as a consequence of
any  judgment,  decree,  order  or  direction   of  the  appellate
20
authority, Appellate Tribunal or any court, the limitation of
one year shall be computed from the date of such judgment,
decree, order or direction;
(c) where any duty is paid provisionally under section 18, the
limitation of one year shall be computed from the date of
adjustment of duty after the final assessment thereof or in
case of re­assessment, from the date of such re­assessment.]
(2)   If,   on   receipt   of   any   such   application,   the   Assistant
Commissioner   of   Customs   or   Deputy   Commissioner   of
Customs is satisfied that the whole or any part of the duty
and interest, if any, paid on such duty paid by the applicant
is refundable, he may make an order accordingly and the
amount so determined shall be credited to the Fund:
Provided that the amount of duty and interest, if any, paid
on such duty as determined by the Assistant Commissioner
of Customs or Deputy Commissioner of Customs under the
foregoing   provisions   of   this   sub­section   shall,   instead   of
being credited to the Fund, be paid to the applicant, if such
amount is relatable to­
(a) the duty and interest, if any, paid on such duty paid by
the importer [or the exporter, as the case may be], if he had
not passed on the incidence of such duty and interest, if any,
paid on such duty to any other person;
(b)   the   duty   and   interest,   if   any,   paid   on   such   duty   on
imports made by an individual for his personal use ;
(c) the duty and interest, if any, paid on such duty borne by
the buyer, if he had not passed on the incidence of such duty
and interest, if any, paid on such duty to any other person;
(d) the export duty as specified in section 26;
(e) drawback of duty payable under sections 74 and 75;
(f) the duty and interest, if any, paid on such duty borne by
any   other   such   class   of   applicants   as   the   Central
Government   may,   by   notification   in   the   Official   Gazette,
specify:
(g) the duty paid in excess by the importer before an order
permitting clearance of goods for home consumption is made
where­­
(i) such excess payment of duty is evident from the bill of
entry in the case of self­assessed bill of entry; or
(ii) the duty actually payable is reflected in the reassessed
bill of entry in the case of reassessment.
Provided further that no notification under clause (f) of the
first proviso shall be issued unless in the opinion of the
Central Government the incidence of duty and interest, if
any,  paid  on such  duty has  not  been  passed  on  by the
persons concerned to any other person.
21
(3)  Notwithstanding anything to the contrary contained in
any judgment, decree, order or direction of the Appellate
    Tribunal, the National Tax Tribunal or any Court or in any
other   provision   of   this   Act   or   the   regulations   made
thereunder or any other law for the time being in force, no
refund shall be made except as provided in sub­section (2).
(4) Every notification under clause (f) of the first proviso to
sub­section (2) shall be laid before each House of Parliament,
if it is sitting, as soon as may be after the issue of the
notification, and, if it is not sitting, within seven days of its
re­assembly, and the Central Government shall, seek the
approval of Parliament  to the notification by a resolution
moved within a period of fifteen days beginning with the day
on which the notification is so laid before the House of the
People   and   if   Parliament   makes   any   modification   in   the
notification or directs that the notification should cease to
have effect, the notification shall thereafter have effect only
in such modified form or be of no effect, as the case may be,
but without prejudice to the validity of anything previously
done thereunder.
(5) For the removal of doubts, it is hereby declared that any
notification issued under clause (f) of the first proviso to subsection   (2),   including   any   such   notification   approved   or
modified  under  sub­section  (4), may be  rescinded  by  the
Central Government at any time by notification in the Official
Gazette."
(emphasis supplied)
28. Section 28 deals with the recovery of duties not levied or not paid or
short levied or short paid or erroneously refunded. Section 28(1) is extracted
hereunder:
“28. Recovery of duties not levied or not paid or shortlevied or short­paid or erroneously refunded.­­ (1) Where any
duty has not been levied or not paid or has been short­levied
or   short­paid   or   erroneously   refunded,   or   any   interest
payable   has   not   been   paid,   part­paid   or   erroneously
refunded, for any reason other than the reasons of collusion
or any wilful mis­statement or suppression of facts,­­
(a) the proper officer shall, within two years from the relevant
date, serve notice on the person chargeable with the duty or
interest which has not been so levied or paid or which has
been short­levied or short­paid or to whom the refund has
22
erroneously been made, requiring him to show cause why he
should not pay the amount specified in the notice;
Provided that before issuing notice, the proper officer shall
hold pre­notice consultation with the person chargeable with
duty or interest in such manner as may be prescribed;
(b) the person chargeable with the duty or interest, may pay
before service of notice under clause (a) on the basis of,­­
(i) his own ascertainment of such duty; or
(ii) the duty ascertained by the proper officer,
the amount of duty along with the interest payable thereon
under section 28AA or the amount of interest which has not
been so paid or part­paid:
Provided that the proper officer shall not serve such show
cause notice, where the amount involved is less than rupees
one hundred.”                                       
   (emphasis supplied)
29. The first question for consideration is whether in the case of selfassessment without passing a speaking order, it can be termed to be an
order of self­assessment. It was urged on behalf of the assesses that there is
no   application   of   mind   and   merely   an   endorsement   is   made   by   the
authorities concerned on the bill of entry which cannot be said to be an
order much less a speaking order.
30. In  Escorts Ltd. v. Union of India & Ors. (1994) Supp. 3 SCC 86 the
question   arose   for  consideration   as   to   the   Bill   of   Entry   classifying  the
imported goods under a certain tariff item and paying the duty thereon.
This   Court  held   that   in   such   a   case   signing  of   the   bill   of   entry  itself
amounted   to   passing   an   order   of   assessment.   Hence,   the   application
seeking a refund on the ground that imported goods fell under a different
item attracting a far lower rate of duty, having been filed more than six
months after the payment of duty, was rightly rejected as time­barred. What
is of significance is that an entry made in the bill of entry has been held to
23
be an order of assessment passed by the Assessing Officer. This Court
considered the provisions of sections 47 and 17 of the Customs Act and has
observed:
“9. Reading Sections 47 and 17 together, it is clear
beyond any doubt, that as soon as the bill of entry is filed,
the proper officer examines the goods, tests them, assesses
the proper duty and permits clearance of goods only after the
duty and other charges, if any, are paid. In the scheme of the
Act, there is no room for contending that any goods will be
allowed   to   be   cleared   without   assessment   of   the   duty,
whether provisional or final, as the case may be.
10.  Now it may be noticed that the Act does not prescribe
any particular form in which the order of assessment is to be
made.   In   the   very   nature   of   things,   no   formal   order   of
assessment can be expected when there is no dispute as to
the classification or the rate of duty. No formal order can be
expected in such a case, it is more like ‘across­the­counter'
affair.  In the  present   case,  it  may be  reiterated  that  the
appellant himself classified the goods under tariff item No.
73.33/40   and   paid   the   duty   at   the   rate   applicable
thereunder. At that stage, he did not raise any dispute either
as  to  classification or  as to the  right   of  duty  applicable.
Hence, there was no occasion for passing a formal order
since   there   was   no   lis   at   that   stage.   The   bill   of   entry
presented by the appellant was signed, signifying approval by
the assessing officer. That itself is an order of assessment in
such a situation. We are, therefore, not prepared to agree
that   there   is   no   order   of   assessment   in   this   case,   and
therefore,  the limitation  prescribed in Section 27 did  not
begin to run. Section 27 is emphatic in language. It says that
an application for refund of duty shall be made before the
expiry of six months from the date on which the duty was
paid. In the face of this provision, the authorities under the
Act, including the Government of India, had no option but to
dismiss   the   appellant’s   application.  This   is   also   the   view
taken by this Court in Madras Rubber Factory Ltd. v. Union
of India (1976) 2 SCC 255.”
(emphasis supplied)
31. It is apparent from the aforesaid discussion that the endorsement made
on the bill of entry is an order of assessment. It cannot be said that there is
24
no   order  of   assessment   passed   in   such   a   case.   When   there   is   no  lis,
speaking order is not required to be passed in “across the counter affair”.
 32. Coming to the procedure of assessment of duty as prevailed before the
amendment of the Act prior to the amendment made in section 17(1) by the
Finance Act of 2011, the imported goods or exported goods were required to
be examined and tested by the proper officer. After such examination, he
had to make an assessment of the duty, if any, leviable on these goods.
Under sub­section (3) of section 17, the proper officer was authorized to
require the importer, exporter or any other person to produce any contract,
broker's note or any other document as specified in the proviso and to
furnish   any   required   information.   Notwithstanding   that   the   statements
made in the bill of entry relating thereto and the documents produced and
the   information   furnished   under   sub­section   (3);   but   if   it   was   found
subsequently on examination or testing of the goods or otherwise that any
statement in such bill of entry or document or any information so furnished
was not true, he could have proceeded to reassess the duty. Where the
assessment done  under sub­section  (2)  is contrary to  the  claim of the
importer   or   exporter   regarding   valuation   of   the   goods,   classification,
exemption or concession, speaking order shall be passed within 15 days
from the date of assessment of the bill of entry or the shipping bill as the
case may be as provided in section 17(5).
33. Under the provisions of section 17 as amended by Finance Act of
2011, section 17(1) has provided to self­assess the duty if any leviable on
25
such goods by importer or exporter as the case may be. Self­assessment is
an assessment as per the amended definition of section 2(2). It is further
provided that proper officer may verify the self­assessment of such goods,
and for this purpose, examine or test any imported goods or exported goods
or   such   part   thereof   as   may   be   necessary.   The   power   to   verify   selfassessment lies with the proper officer and for that purpose under section
17(3), he may require the importer, exporter or any other person to produce
such document and furnish such information, etc. If the proper officer on
verification has found on examination or testing of the goods or as part
thereof or otherwise that the self­assessment is not done correctly,   the
proper officer may, without prejudice to any other action which may be
taken under the Act, may proceed to re­assess the duty leviable on such
goods.   Section   17(5)   of   the   Act   as   amended   provides   that   where   reassessment done under sub­section 17(4) is contrary to the assessment
done by the importer or exporter regarding the matters specified therein, the
proper officer has to pass a speaking order on the re­assessment, within 15
days from the date of reassessment of the bill of entry or the shipping bill,
as the case may be. The explanation to amended section 17 has clarified
that import or export before the amendment by Finance Act, 2011 shall be
governed by unamended provisions of section 17.
34. Section 18 deals with the provisional assessment of duty where the
importer or exporter is unable to make self­assessment or the proper officer
deem it necessary to subject any imported or export goods to any chemical
26
or other tests; or where further inquiry is deemed necessary by the proper
officer.
35. Section   27   of   the   Act   prior   to   amendment   by   Finance   Act,   2011
provided for refund procedure. Any person could claim a refund of duty and
interest if any paid on such duty. Refund of duty and interest if any paid
pursuant   to   the   order   of   assessment   or   borne   by   him,   may   make   an
application   for   refund   of   such   duty   to   the   Assistant   Commissioner   of
Customs or Deputy Commissioner of Customs within one year in the case of
any import made by any individual for his personal use or by Government
or by any educational, research or charitable institution or hospital. In any
other case before the expiry of six months from the date of payment of duty
and interest. He has to further satisfy that he has not passed on such
liability to any other person. The limitation of one year or six months shall
not apply where any duty and interest has been paid under protest. It is
made clear by the second proviso to section 27 that in case of refund
becomes necessary as a consequence of judgment, decree, order or direction
of the appellate authority, Appellate Tribunal or any court, the limitation of
one year or six months shall commence from the date of such judgment,
decree, order or direction.
36. Section 27 of the Customs Act as amended by Finance Act, 2011
provides that any person claiming refund of any duty or interest paid or
borne by him, may make an application in such form and manner as may
be prescribed for such refund to the Assistant or Deputy Commissioner of
27
Customs before the expiry of one year from the date of payment of such
duty or interest. If an application for refund has been made before Finance
Bill received the assent of the President, it is deemed to be filed under the
provision of section 27 (1) as existed and to be dealt with under section
27(2).   The period of limitation of one year provided by the provisions of
section 27 has to be computed in the case of goods which are exempt from
payment of duty by a special order issued under section 25(2) from the date
of issue of such an order as provided in section 27(1B)(a). Where the duty
becomes refundable as a consequence of any judgment, decree, order or
direction of the appellate authority, Appellate Tribunal or any Court, the
limitation of one year shall be computed from the date of such judgment,
decree, order or direction. It is provided in Section 27(1B)(c) that where any
duty is paid provisionally under Section 18, the limitation of one year shall
be computed from the date of adjustment of duty after the final assessment
thereof   or   in   the   case   of   re­assessment,   from   the   date   of   such   reassessment. The second proviso to section 27 makes it clear that limitation
of 1 year shall not apply where any duty or interest has been paid under
protest. 
37. Under Section 27(2)(a) it is incumbent upon the applicant to satisfy
that the amount of duty or interest of which refund has been claimed, had
not   been   passed   by   him   to   any   other   person,   the   provision   aims   at
preventing unjust enrichment.
28
38. No  doubt  about  it  that the  expression  which   was  earlier  used  in
Section 27(1)(i) that “in pursuance of an order of assessment” has been
deleted from the amended provision of Section 27 due to introduction of
provision as to self­assessment. However, as self­assessment is nonetheless
an  order of assessment, no difference is made by deletion of aforesaid
expression as no separate reasoned assessment order is required to be
passed in the case of self­assessment as observed by this Court in Escorts
Ltd. v. Union of India & Ors. (supra).
39. In  Collector of Central Excise, Kanpur v. Flock (India) Pvt. Ltd. 2000
(120) ELT 285 (SC)= (2000) 6 SCC 650, the question which came up for
consideration before this Court was non­challenge of an appealable order
where the adjudicating authority had passed an order which is appealable
under the statute, and the party aggrieved did not choose to file an appeal.
This Court held that it is not open to the party to question the correctness
of the order of the adjudicating authority subsequently by filing a claim for
refund on the ground that the adjudicating authority had committed an
error in passing the order. The provisions of the Central Excise Act, 1944
came up for consideration. The Court has observed:
“10. Coming to the question that is raised, there is
little scope for doubt that in a case  where an adjudicating
authority has passed an order which is appealable under the
statute and the party aggrieved did not choose to exercise
the statutory right of filing an appeal, it is not open to the
party   to   question   the   correctness   of   the   order   of   the
adjudicating   authority   subsequently   by   filing   a   claim   for
refund on the ground that the adjudicating authority had
committed an error in passing its order.  If this position is
29
accepted then the provisions for adjudication in the Act and
the Rules, the provision for appeal in the Act and the Rules
will   lose   their   relevance   and   the   entire   exercise   will   be
rendered   redundant.  This   position,   in   our   view,   will   run
counter   to   the   scheme   of   the   Act   and   will   introduce   an
element   of   uncertainty   in   the   entire   process   of   levy   and
collection   of   excise   duty.  Such   a   position   cannot   be
countenanced. The view was taken by us also gains support
from the provision in sub­rule (3) of Rule 11 wherein it is laid
down that whereas a result of any order passed in appeal or
revision under the Act, refund of any duty becomes due to
any person, the proper officer may refund the amount to
such person without his having to make any claim in that
behalf. The provision indicates the importance attached to an
order of the appellate or revisional authority under the Act.
Therefore, if an order which is appealable under the Act is
not challenged then the order is not liable to be questioned
and the matter is not to be reopened in a proceeding for the
refund   which,   if   we  may   term   it   so,   is   in   the   nature   of
execution of a decree/order. In the case at hand, it was
specifically mentioned in the order of the Assistant Collector
that the assessee may file an appeal against the order before
the Collector (Appeals) if so advised."         
 (emphasis supplied)
40. In Priya Blue Industries Ltd. v. Commissioner of Customs (Preventive)
2004   (172)   ELT   145   (SC)=   (2005)   10   SCC   433,   the   Court   considered
unamended   provision   of   Section   27   of   the   Customs   Act   and   a   similar
submission was raised which was rejected by this Court observing that so
long as the order of assessment stands, the duty would be payable as per
that order of assessment. This Court has observed thus:
  "6. We are unable to accept this submission. Just such a
contention has been negatived by this Court in Flock (India)
case (2000) 6 SCC 650.  Once an order of assessment is
passed the duty would be payable as per that order. Unless
that order of assessment has been reviewed under Section
28 and/or modified in an appeal, that order stands. So long
as the order of assessment stands the duty would be payable
as per that order of assessment. A refund claim is not an
appeal proceeding.  The officer considering a refund claim
cannot   sit   in   appeal   over   an   assessment   made   by   a
30
competent officer. The officer considering the refund claim
cannot also review an assessment order.
7. We also see no substance in the contention that provision
for a period of limitation indicates that a refund claim could
be  filed  without  filing  an appeal.  Even  under  Section  11
under the Excise Act, the claim for refund had to be filed
within a period of six months.  It was still held, in Flock
(India)’s case (supra), that in the absence of an appeal having
been filed no refund claim could be made.
8. The words "in pursuance of an order of assessment" only
indicate the party/person who can make a claim for refund.
In other words, they enable a person who has paid duty in
pursuance of an order of assessment to claim the refund.
These words do not lead to the conclusion that without the
order   of   assessment   having   been   modified   in   appeal   or
reviewed a claim for refund can be maintained."
(emphasis supplied)
41. It is apparent from provisions of refund that it is more or less in the
nature of execution proceedings. It is not  open to  the authority which
processes the refund to make a fresh assessment on merits and to correct
assessment on the basis of mistake or otherwise.
42. It   was   contended   that   no   appeal   lies   against   the   order   of   selfassessment.     The   provisions   of   Section   128   deal   with   appeals   to   the
Commissioner (Appeals). Any person aggrieved by any decision or order may
appeal to the Commissioner (Appeals) within 60 days. There is a provision
for condonation of delay for another 30 days. The provisions of Section 128
are extracted hereunder:
“128. Appeals to [Commissioner (Appeals)]. ­­ (1) Any
person aggrieved by any decision or order passed under this
Act by an officer of customs lower in rank than a [Principal
Commissioner of Customs or Commissioner of Customs] may
appeal to the [Commissioner (Appeals)] [within sixty days]
from the date of the communication to him of such decision
or order:
31
[Provided   that   the   Commissioner   (Appeals)   may,   if   he   is
satisfied that the appellant was prevented by sufficient cause
from presenting the appeal within the aforesaid period of
sixty days, allow it to be presented within a further period of
thirty days.]
 [(1A) The Commissioner (Appeals) may, if sufficient cause is
shown, at any stage of hearing of an appeal, grant time, from
time to time, to the parties or any of them and adjourn the
hearing of the appeal for reasons to be recorded in writing:
Provided that no such adjournment shall be granted more
than three times to a party during hearing of the appeal.]
(2) Every appeal under this section shall be in such form and
shall be verified in such manner as may be specified by rules
made in this behalf."
43. As the order of self­assessment is nonetheless an assessment order
passed under the Act, obviously it would be appealable by any person
aggrieved thereby. The expression ‘Any person' is of wider amplitude. The
revenue, as well as assessee, can also prefer an appeal aggrieved by an
order of assessment. It is not only the order of re­assessment which is
appealable but the provisions of Section 128 make appealable any decision
or order under the Act including that of self­assessment. The order of selfassessment is an order of assessment as per section 2(2), as such, it is
appealable   in   case   any   person   is   aggrieved   by   it.   There   is   a   specific
provision made in Section 17 to pass a reasoned/speaking order in the
situation   in   case   on   verification,   self­assessment   is   not   found   to   be
satisfactory, an order of re­assessment has to be passed under section
17(4). Section 128 has not provided for an appeal against a speaking order
but against “any order” which is of wide amplitude. The reasoning employed
by the High Court is that since there is no lis, no speaking order is passed,
32
as such an appeal would not lie, is not sustainable in law, is contrary to
what has been held by this Court in Escorts (supra).
44. The provisions under section 27 cannot be invoked in the absence of
amendment or modification having been made in the bill of entry on the
basis of which self­assessment has been made. In other words, the order of
self­assessment is required to be followed unless modified before the claim
for refund is entertained under Section 27. The refund proceedings are in
the nature of execution for refunding amount. It is not assessment or reassessment proceedings at all. Apart from that, there are other conditions
which   are   to   be   satisfied   for   claiming   exemption,   as   provided   in   the
exemption notification. Existence of those exigencies is also to be proved
which cannot be adjudicated within the scope of provisions as to refund.
While processing a refund application, re­assessment is not permitted nor
conditions of exemption can be adjudicated. Re­assessment is permitted
only under Section 17(3)(4) and (5) of the amended provisions. Similar was
the position prior to the amendment. It will virtually amount to an order of
assessment or re­assessment in case the Assistant Commissioner or Deputy
Commissioner   of   Customs   while   dealing   with   refund   application   is
permitted to adjudicate upon the entire issue which cannot be done in the
ken of the refund provisions under Section 27. In Hero Cycles Ltd. v. Union
of India  2009 (240) ELT 490 (Bom.) though the High Court interfered to
direct the entertainment of refund application of the duty paid under the
33
mistake of law. However, it was observed that amendment to the original
order of assessment is necessary as the relief for a refund of claim is not
available as held by this Court in Priya Blue Industries Ltd. (supra).
45. Reliance was also placed on a decision of Rajasthan High Court with
respect to service tax in Central Office Mewar Palace Org. v. Union of India
2008 (12) STR 545 (Raj.). In view of the aforesaid discussion, we are not
inclined to accept the reasoning adopted by the High Court, that too is also
not under the provisions of the Customs Act.
46. The decision in  Intex Technologies (India) Ltd. v. Union of India  has
followed Micromax (supra). The reasoning employed by the High Courts of
Delhi and Madras does not appear to be sound. The scope of the provisions
of refund under Section 27 cannot be enlarged. It has to be read with the
provisions of Sections 17, 18, 28 and 128. 
47. When   we   consider   the   overall   effect   of   the   provisions   prior   to
amendment and post­amendment under Finance Act, 2011, we are of the
opinion that the claim for refund cannot be entertained unless the order of
assessment or self­assessment is modified in accordance with law by taking
recourse to the appropriate proceedings and it would not be within the ken
of Section 27 to set aside the order of self­assessment and reassess the duty
for making refund; and in case any person is aggrieved by any order which
would include self­assessment, he has to get the order modified under
Section 128 or under other relevant provisions of the Act. 
34
48. Resultantly, we find that the order(s) passed by Customs, Excise, and
Service Tax Appellate Tribunal is to be upheld and that passed by the High
Courts of Delhi and Madras to the contrary, deserves to be and are hereby
set aside. We order accordingly. We hold that the applications for refund
were not maintainable. The appeals are accordingly disposed of. Parties to
bear their own costs as incurred.       
 
…………………………. J.
(Arun Mishra)
…………………………. J.
(Navin Sinha)
…………………………. J.
        (Indira Banerjee)
New Delhi;
September 18, 2019.

Simply because the Exchange deed with the third party became void due to non obtaining permission from the collector, did not cloth any rights to the original vendors to reclaim their land once sold =The submission of learned counsel for the appellants that interference in the concurrent finding and the exchange deed being void as the permission from Assistant Collector has not been obtained and in consequence they are entitled for restoration/possession of plot no.2902 (area 0.34 decimals) which was originally sold by registered sale deed dated 24th January, 1973 to late N.D. Chaudhary is without substance for the reason that these are two separate transactions which has taken place of the subject plot in question. As regards the rights and interests which were transferred by the present appellants vide registered sale deed dated 24th January, 1973 in favour of late N.D. Chaudhary was never the subject matter of scrutiny and there was no violation/contravention of the provisions of Act, 1950 or of any other law has been pointed out to us. At the same time, so far as non­compliance of the mandatory requirement as envisaged under Section 161 of the Act, 1950 while executing the exchange deed dated 2nd March, 1974 is concerned, parties have to bear its consequences of the void transaction as provided under Section 166 read with Section 167 of the Act, 1950 but that will not give any preference to theappellants for restoration of their rights and to nullify the registered sale deed dated 24th January, 1973 executed after taking due consideration in favour of late N.D. Chaudhary.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S). 8179 OF 2016
SITA RAM(DEAD) THROUGH LRS.      …..APPELLANT(S)
VERSUS
BHARAT SINGH(DEAD)
THROUGH LRS & ORS.     …..RESPONDENT(S)
WITH
CIVIL APPEAL NO(S). 8181 OF 2016
J U D G M E N T
Rastogi, J.
1. These appeals arise from the judgment dated 5th July, 2007
passed by the High Court of Allahabad in setting at naught the
inter se rights of the litigating parties initiated under the Uttar
Pradesh   Zamindari   Abolition   and   Land   Reforms   Act,
1
1950(hereinafter being referred to as the “Act, 1950”) arising from
the registered deed of exchange dated 2nd March, 1974.
2. The brief facts of the case culled out from the record are
that   Smt.   Chando   and   Sita   Ram   (since   deceased)   who   were
tenure   holders   of   Plot   No.   2902   ad­measuring   0.34   decimals
situated in Village Mathura Bangar, Tehsil & District Mathura,
U.P. sold the subject plot on transfer of consideration to late N.D.
Chaudhary(father of respondent nos. 10 & 11) vide registered
sale   deed   dated   24th  January,   1973.     Late   Kesho   Ram
(father/grandfather of respondent nos. 1 to 8), who was tenure
holder of plot nos. 2863 and 2888, with consent, exchanged his
plots with plot no. 2902 owned by late N.D. Chaudhary by a
registered deed of exchange dated 2nd March, 1974.  As a result of
the deed of exchange, plot no. 2902 ad­measuring 0.34 decimals
was transferred in favour of late Kesho Ram and plot nos. 2863
and 2888 in favour of late N.D. Chaudhary.
3. That at the time of field partal (chakbandi) in the village for
correction   of   revenue   records   conducted   by   the   Assistant
Consolidation Officer (ACO) late Kesho Ram(father/grandfather of
2
respondent nos. 1 to 8) filed application under Section 9A(2) of
the   Uttar   Pradesh   Consolidation   of   Holdings   Act,   1953
(hereinafter referred to as “the Act, 1953”) and prayed that his
name be recorded on Plot No. 2902 by virtue of the exchange
deed executed between him and late N.D. Chaudhary dated 2nd
March, 1974.
4. It   may   be   noticed   that   late   N.D.   Chaudhary   who   had
exchanged his Plot No. 2902 with Plot Nos. 2863 and 2888 from
late   Kesho   Ram   also   filed   application   in   the   consolidation
proceedings and supported the case of late Kesho Ram who was
the applicant in the proceedings for opening of mutation in his
name in the revenue records.
5. At this stage Smt. Chando and Sita Ram who were the
original tenure holders of Plot No. 2902 who had sold it to late
N.D. Chaudhary, by a registered sale deed dated 24th  January,
1973, raised an objection regarding validity of the registered sale
deed dated 24th January, 1973.  The Consolidation Officer, after
appraisal of the material on record, held that the sale deed dated
24th  January, 1973 executed by Smt. Chando and Sita Ram in
3
reference to plot no. 2902 in favour of late N.D. Chaudhary was
genuine and valid and was jointly executed by Smt. Chando and
Sita   Ram   and   in   regard   to   the   exchange   of   plots,   the
Consolidation   Officer   held   that   the   exchange   was   permissible
only   with   permission   of   the   Assistant   Collector   in   terms   of
Section 161 of the Act, 1950 which, in the instance case, was not
obtained by the parties.  In the absence of permission which is
pre­requisite,   he   is   not   entitled   to   be   recorded   as   Bhumidar
under the consolidation proceedings.  When the matter travelled
in appeal under Section 11 of the Act, 1953, it was observed that
the registered sale deed dated 24th January, 1973 was not proved
based on appreciation of evidence and further held that the deed
of   exchange   dated   2nd  March,   1974   was   void   for   want   of
permission from the competent authority provided under Section
161 of the Act, 1950 and the appeal was consequently dismissed
on 18th January, 1982.
6. The matter further travelled before the State Government in
its revisional jurisdiction under Section 48 of Act, 1953 filed at
the instance of late N.D. Chaudhary and late Kesho Ram before
Deputy   Director,   Consolidation,   Mathura,   both   the   revision
4
petitions came to be dismissed although authority did not record
any finding regarding validity of the sale deed but from the order,
it   reveals   that   the   authority   proceeded   on   the   premise   that
registered sale deed dated 24th January, 1973 was genuine and
valid.
7. The order of the revisional authority dated 19th July, 1984
came to be challenged by late Kesho Ram in a writ petition under
Article 227 of the Constitution of India and taking note of the
pleadings on record, the High Court vide impugned judgment
dated 5th July, 2007 observed that the exchange deed dated 2nd
March,   1974   was   in   contravention   of   Section   166   read   with
Section 167 of the Act, 1950 and any exchange in the absence of
permission from Assistant Collector was void by virtue of Section
166 at the same time further observed that it was the State
Government who could apply for cancellation if affected by the
registered deed of exchange but it was not open to be questioned
at the instance of the original tenure holder Smt. Chando and
Sita Ram who are now being represented by their legal heirs of
plot   no.   2902   who   had   sold   with   their   consent   to   late   N.D.
5
Chaudhary on 24th January, 1973 through a registered sale deed
which was  not a subject matter of challenge in appeal before us.
8. The moot question which has been raised for consideration
is as to what will be the legal consequences if the registered
exchange deed dated 2nd March, 1974 has been executed without
following the procedure prescribed as provided under Section 161
of the Act, 1950.
9. Learned counsel for the appellants submits that the High
Court in its supervisory jurisdiction under Article 227 of the
Constitution   of   India   has   exceeded   in   its   jurisdiction   in
interfering   with   the   concurrent   finding   arrived   at   by   the
consolidation authorities holding that late N.D. Chaudhary did
not get his name mutated in the revenue records based on the
registered sale deed dated 24th January, 1973 and at the time of
initiation of the consolidation proceedings, he did not put forth
any claim or filed any objection provided under Section 9A of the
Act, 1953.  At the same time, the exchange deed dated 2nd March,
1974   was   executed   without   seeking   permission   from   the
competent   authority   (Assistant   Collector)   as   provided   under
6
Section 161 of the Act, 1950 and such exchange being void, late
Kesho Ram cannot claim any right over the plot in question to
open mutation and in consequence the appellants hold a right
over the subject plot no. 2902 even if it was sold by Smt. Chando
and Sita Ram(predecessor in interest) jointly by registered sale
deed dated 24th January, 1973.
10. Learned counsel further submits that the High Court has
failed   to   appreciate   the   legal   effect   of   Section   166   read   with
Section 167 of the Act, 1950 and the action once being held to be
void by operation of law, they are entitled to hold their right and
possession over plot no. 2902.
11. Per   contra,   learned   counsel   for   the   respondents,   while
supporting   the   finding   recorded   by   the   High   Court,   further
submits that once plot no.2902 ad­measuring 0.34 decimals was
sold by the appellants (predecessor in interest) jointly by the
registered   sale   deed   dated   24th  January,   1973   to   late   N.D.
Chaudhary,   they   have   lost   their   rights   and   interest   over   the
subject plot in question and whatever the default, if any, being
committed by late N.D. Chaudhary, it will not give support to the
7
present appellants in making their claim over the subject plot in
question   and   further   submits   that   the   permission   of   the
Assistant Collector even if not obtained would not take away
rights of the parties which have been conferred on transfer of the
property by the registered exchange deed dated 2nd March, 1974
and as per the scheme of the Act, 1950, transfers made prior to
3
rd June, 1981 are not void but are voidable at the option of the
suit to be filed by Gaon Sabha or land holder within the period of
limitation.   Indisputedly, no action was taken either by Gaon
Sabha or land holder within the period of limitation.  In the given
facts and circumstances, no error has been committed by the
High   Court   in   the   impugned   judgment   which   may   call   for
interference.
12. We have heard learned counsel for the parties and with
their assistance perused the material available on record.
13. The deed of exchange between late N.D. Chaudhary (father
of   respondent   nos.   10   and   11)   and   late   Kesho   Ram
(father/grandfather of respondent nos. 1 to 8) was executed by
the registered deed on 2nd March, 1974.  Section 161, 166 and
8
167 of the Act, 1950 as existing prior to the amendment made on
3
rd June, 1981 are ad infra:­
“Section 161 Exchange. [(1) A bhumidhar or sirdar
may exchange with :­
(a) any other bhumidhar or sirdar land held by
him, or
(b) any Gaon Sabha or local authority, lands for
the time being vested in it under Sec. 117 [ *
* *] :
Provided that no exchange shall be made except with
the   permission   of   an   Assistant   Collector   who   shall
refuse permission if the difference between the rental
value of land given in exchange and of land received in
exchange calculated at hereditary rates is more than
10 per cent of the lower rental value.
(1­A) Where   the   Assistant   Collector   permits
exchange   he   shall   also   order   the   relevant   annual
registers to be corrected accordingly.
(2)On exchange made in accordance with sub­section
(1)   they   shall  have   the   same   rights   in   the   land   so
received in exchange as they had in the land given in
exchange.”
“S. 166.Transfer   made   in   contravention   of   this
chapter   to   be   void.  Any   transfer,   made   by   or   on
behalf  of  a  sirdar or  asami in  contravention  of  the
provisions of this chapter shall be void.”
By U.P. Act 30 of 1975, the words “in contravention of this
Chapter” were substituted by the words “in contravention of the
provisions of this Act”.
“S. 167.Consequences of void transfers.  [(1)
Where a sirdar or asami has made any transfer in
contravention   of   the   provisions   of   this   Act,   the
transferee   and   every   person   who   may   have   thus
obtained possession of the whole or part of the holding
9
shall be liable to ejectment on the suit of the [Gaon
Sabha or the land holder, as the case may be,]
(2)A decree for ejectment under sub­section (1) may
direct the ejectment of the sirdar or asami from the
whole or part of the holding as the court may, having
regard to the circumstances of the case, direct].”
14. It may be relevant to refer Rule 338 of the U.P. Zamindari
Abolition & Land Reforms Rules, 1952(hereinafter being referred
to as the “Rules 1952”) for the purpose as under:­
“338. The suit applications and other proceedings
specified in Appendix III shall be instituted within the
time specified therein for them, respectively.
Appendix III
(Rule 338)
Sl.
No.
Section
of   the
Act
Description   of   suit,
application   and
other proceeding
Period   of
limitation
Time from which
period   begins   to
run
Proper
court
fees
19. 163 Suits   for   ejectment
of bhumidhar.
Six Years. From the date of
illegal transfer.
As   in
the
Court
Fees
Act,
1870,
on   the
year’s
revenue.
20. 167 Suits   for   ejectment
of   a   sirdhar   or
asami.
Do. Ditto. Ditto.
Substituted 2056/I­A­463­1952 dated 11th April, 1969”
15. It will be appropriate to take note of Sections 161, 166 and
167 amended by U.P. Act No. 20 of 1982(w.e.f. 3rd June, 1981) for
better appraisal ad infra:­
10
“Section 161 Exchange. [(1) A Bhumidhar [* * *] may
exchange with :­
(a) any other bhumidhar [* * *] land held by
him, or
(b) any Gaon Sabha or local authority, lands
for the time being vested in it under Sec.
117 [ * * *] :
Provided that no exchange shall be made except  with
the   permission of an Assistant Collector who shall
refuse permission if the difference between the rental
value of land given in exchange and of land received in
exchange calculated at hereditary rates is more than
10 per cent of the lower rental value.
(1­A) Where   the   Assistant   Collector   permits
exchange   he   shall   also   order   the   relevant   annual
registers to be corrected accordingly.
(2)On exchange made in accordance with sub­section
(1)   they   shall  have   the   same   rights   in   the   land   so
received in exchange as they had in the land given in
exchange.
S. 166. Transfer   made   in   contravention   of   this
chapter   to   be   void.­  Every   transfer   made   in
contravention  of   the   provisions   of   this   Act   shall   be
void.
S. 167. Consequences   of   void   transfers.  (1)   The
following consequences shall ensue in respect of every
transfer which is void by virtue of Section 166, namely­
(a) the subject­matter of transfer shall, with
effect from the date of transfer, be deemed
to   have   vested   in   the   State   Government
free from all encumbrances;
(b) the trees, crops and wells existing on the
land   on   the   date   of   transfer   shall,   with
effect   from   the   said   date,   be   deemed   to
have vested in the State Government free
from all encumbrances;
(c) the transferee may remove other movable
property or the materials of any immovable
11
property existing on such land on the date
of   transfer   within   such   time   as   may   be
prescribed.
(2)Where any land or other property has vested in the
State Government under sub­section (1), it shall be
lawful for the Collector to take over possession over
such land or other property and to direct that any
person   occupying   such   land   or   property   be   evicted
therefrom.   From   the   purposes   of   taking   over   such
possession or evicting such unauthorised occupants,
the Collector may use or cause to be used such force
as may be necessary.]”
16. It emerges from the pre amendment (U.P. Act No. 20 of 1982
w.e.f. 3rd June, 1981) scheme of the Act, 1950 that any transfer
made in contravention of this Chapter referred to under Section
166 which includes Section 161 as well were not be automatically
void but voidable and therefore, as a consequence of alleged void
transfers under Section 167, a suit was required to be filed by the
Gaon Sabha or the land holder, as the case may be, within
limitation of six years from the date of illegal transfer as indicated
in Appendix III annexed to Rule 338 of Rules, 1952 but after the
U.P. Act No. 20 of 1982 amended w.e.f. 3rd June, 1981, the law
has changed and every transfer made in contravention of this Act
became void in view of Section 166 and in consequence of void
transfer, the subject land is deemed to have been vested in the
State   Government   by   operation   of   law   free   from   all
12
encumbrances, and sub­section (2) of Section 167, authorises
Collector/Competent Authority to take over possession with the
use of force as may be necessary. 
17. In the instant case, the exchange deed was executed on 2nd
March, 1974 indisputedly without permission from the Assistant
Collector provided under Section 161 and its consequence was
embedded under Section 167 of the Act, 1950 authorising the
Gaon Sabha or the land holder to file a suit for ejectment within
a period of six years from the date of alleged illegal transfer which
in the instant case had expired in March 1980 much prior to the
U.P. Act No. 20 of 1982 was amended w.e.f. 3rd June, 1981.
18. After the scheme of the Act has been referred to in extenso,
it is clear that at least the amendment which has been made by
the U.P. Land Laws (Amendment) Act, 1982 with effect from 3rd
June, 1981 has no application on the case in hand.
19. The proceedings were initiated in the first instance when an
application was filed by late Kesho Ram under Section 9A(2) of
the Act, 1953 for obtaining mutation in his name in the year
13
1978  and   late  N.D.   Chaudhary  also   joined   him  and   filed   an
application supporting the claim of late Kesho Ram.
20. It reveals from the record that the Consolidation Officer has
declined the claim of late Kesho Ram for seeking the Bhumidari
rights on the premise that the permission from the competent
authority has not been obtained before the exchange deed was
executed as mandated under Section 161 of the Act, 1950 and in
its absence, no proceedings could be drawn claiming Bhumidari
rights in his favour.  Although the Settlement Officer has made
adverse comments in reference to the registered sale deed dated
24th  January, 1973, but that appears to be a factual manifest
error committed in recording such finding.
21. To   make   it   further   clear   that   under   the   pre­amended
scheme of the Act, 1950, the consequence for non­compliance of
Section   161   of   the   Act,   1950   seeking   permission   from   the
Assistant Collector, was indeed the requirement of law and the
effect of contravention and its consequence are embedded under
Section 166 and 167 of the Act, 1950 but its consequential effect,
in no manner, would take away or divest the rights and interest
14
of the parties inter se conferred in reference to the sale deed
which was originally executed in favour of late N.D. Chaudhary
by late Smt. Chando and Sita Ram in reference to plot no. 2902
ad­measuring 0.34 decimals by the registered sale deed dated
24th January, 1973. 
22. It is true that at one stage, late Smt. Chando and Sita Ram
jointly raised objection in the consolidation proceedings initiated
under Section 9A(1) of the Act, 1953 in reference to the registered
sale   deed   dated   24th  January,   1973   but   as   we   have   already
observed that the registered sale deed dated 24th January, 1973
was genuine and duly executed by the parties and it is nowhere
related   in   reference   to   the   exchange   proceedings   which   were
initiated at a later point of time and this fact became clear that so
far as the grievance of Smt. Chando and Sita Ram is concerned,
after the sale deed was registered and executed on 24th January,
1973 in favour of late N.D. Chaudhary, the ownership rights with
possession   stands   transferred.     It   is   true   that   late   N.D.
Chaudhary   had   not   initiated   proceedings   for   claiming   his
Bhumidari rights under the Act, 1953 but that, in any manner
will not, nullify his right of ownership vested on execution of a
15
registered sale deed dated 24th  January, 1973 and there is no
prohibition or restriction to the contrary has been brought to our
notice, if any, under the Act 1950.
23. At a later stage, late N.D. Chaudhary(father of respondent
nos.   10   and   11)   and   late   Kesho   Ram(father/grandfather   of
respondent nos. 1 to 8) who was the tenure holders of plot no.
2683 and 2888 got their plot exchanged by registered exchange
deed   dated   2nd  March,   1974   which   indisputedly   was   in
contravention of Section 161 of the pre­amended Act, 1950 where
it was postulated that no exchange shall be made except with the
permission   of   the   Assistant   Collector.     Indisputedly,   no
permission was sought as contemplated under the mandate of
law but under the pre­amended scheme of the Act, 1950, the
effect of exchange in contravention to the provisions of the Act
and its consequence as embedded under Section 166 and 167 of
the Act, 1950 makes the action to be voidable and not void and it
entails consequences of void transfers, in the first instance, it
only confines to sirdar or asami and not applicable upon those
who are claiming rights of Bhumidar.   At the same time, any
transfer which has been made in contravention of the provisions
16
of this Act including permission from the Assistant Collector as
required under Section 161, the ejectment may be possible only
on filing of a suit by Gaon Sabha or the land holder, as the case
may be, and after the decree of ejectment being obtained under
sub­section (1) of Section 167 of the Act, ejectment under subsection (2) of Section 167 be permissible and for filing of the suit,
the limitation has been provided under Appendix III annexed to
Rule 338 of the Rules, 1952 of which reference has been made in
terms thereof suit for ejectment could be filed within a period of
six years from the date of the illegal transfer. 
24. The  deed of  exchange  in  the  instant  case  was  executed
between   the   parties   on   2nd  March,   1974   and   the   period   of
limitation for filing of the suit had expired in March 1980 much
before the U.P. Act No. 20 of 1982 amended w.e.f. 3rd June, 1981
came into force.  Indisputedly, no suit was filed either by Gaon
Sabha   or   any   land   holder   for   ejectment   as   envisaged   under
Section 167(1) of the Act, 1950.  That apart, even assuming for
the sake of argument, the deed of exchange executed on 2nd
March, 1974 even if considered to be void, taking note of the post
amended provisions of the Act, 1950, it will still confine to the
17
deed of exchange dated 2nd  March, 1974 which was obtained
without   taking   permission   from   the   Assistant   Collector   as
envisaged under Section 161 of the Act and at the best the rights
to the parties on execution of exchange deed could not be given
effect   to   and   it   remain   inter   se   between   parties   to   the
exchange(late Kesho Ram and late N.D. Chaudhary) at the same
time, so far as the subject plot which was once transferred by the
original tenure holders, namely, Smt. Chando and Sita Ram who
are throughout contesting the matter (plot no.2902 area 0.34
decimals) to late N.D. Chaudhary by a registered sale deed dated
24th January, 1973 which has been held to be genuine and valid,
will not be under any legal impediment or having any effect on
the rights of the parties, and the said transaction was not subject
to compliance of Section 161 of the Act, 1950 and at least no
rights of any kind over plot no. 2902 area 0.34 decimals could be
claimed by the original tenure holders (appellants herein) and
their grievance that late N.D. Chaudhary had not claimed his
Bhumidari rights under the Act, 1953, suffice it to say, that no
such provision to the contrary has been brought to our notice
that if the holder has not taken steps for claiming Bhumidari
rights under the Act, 1953 that will take away or divest from the
18
legal rights conferred to the party in whose favour registered sale
deed has been executed under the mandate of law. 
25. We are of the view that at least late Smt. Chando and Sita
Ram,   whose   legal   representatives   are   contesting   the   case
throughout are not holding any locus standi to claim benefit of
the     defect   in   the   deed   of   exchange   dated   2nd  March,   1974
executed   between   different   parties   who   are   holders   to   their
respective plots in their own rights and the procedure mandated
under the law if not being followed of taking permission from the
Assistant Collector as required under Section 161 of the Act,
1950, its consequences would not revive/restore the rights to the
legal heirs of late Smt. Chando and Sita Ram(original tenure
holders) over the subject property in question.  That apart, the
present appellants have never raised any plea for cancellation of
the   registered   sale   deed   executed   in   favour   of   late   N.D.
Chaudhary dated 24th  January, 1973 which was otherwise not
the subject matter to be examined under the provisions of the
Act, 1950.
19
26. The submission of learned counsel for the appellants that
interference in the concurrent finding and the exchange deed
being void as the permission from Assistant Collector has not
been   obtained   and   in   consequence   they   are   entitled   for
restoration/possession   of   plot   no.2902   (area   0.34   decimals)
which   was   originally   sold   by   registered   sale   deed   dated   24th
January, 1973 to late N.D. Chaudhary is without substance for
the reason that these are two separate transactions which has
taken place of the subject plot in question.  As regards the rights
and interests which were transferred by the present appellants
vide registered sale deed dated 24th  January, 1973 in favour of
late N.D. Chaudhary was never the subject matter of scrutiny
and there was no violation/contravention of the provisions of Act,
1950 or of any other law has been pointed out to us.  
27. At   the   same   time,   so   far   as   non­compliance   of   the
mandatory requirement as envisaged under Section 161 of the
Act, 1950 while executing the exchange deed dated 2nd  March,
1974 is concerned, parties have to bear its consequences of the
void transaction as provided under Section 166 read with Section
167 of the Act, 1950 but that will not give any preference to the
20
appellants   for   restoration   of   their   rights   and   to   nullify   the
registered   sale   deed   dated   24th  January,   1973   executed   after
taking due consideration in favour of late N.D. Chaudhary.
28. In our considered view, the conclusions of the High Court in
its judgment impugned are unassailable and does not call for our
interference. 
29. Consequently,   the   appeals   fail   and   are   accordingly
dismissed.  No costs.
30. Pending application(s), if any, stand disposed of.
.…………………………J.
(A.M. KHANWILKAR)
………………………….J.
(AJAY RASTOGI)
NEW DELHI
SEPTEMBER 17, 2019
                                                       
21

Burden of Proof -unless it was clearly pleaded that she is an illiterate lady and paradhasheen lady - the burden never shifts on defendants to prove that the contents are read over and explained and the same were read over and thereafter only she put her LTI = High Court has proceeded that the plaintiff­first respondent was a pardanasheen illiterate lady and shifting the burden of proof on the shoulder of the appellant­first defendant to establish that the document was explained to the plaintiff­first respondent and she understood it and thereafter transaction was entered into, is against the pleadings on record.= On perusal of the plaint, it reveals that it has nowhere been pleaded that the plaintiff­first respondent is a pardanasheen illiterate lady. In the ordinary course the burden of proof rest, on who attack. On the contrary, it was pleaded in the plaint that defendant nos.1 and 3 are the sons of her uncle Mangta and defendant no. 2 is the wife of defendant no. 1 and they hatched a conspiracy to grab the land of the plaintiff­first respondent and with connivance, the power of attorney was prepared & registered on 25th April, 1995 in the registry office, in the name of the plaintiff and pursuant thereto, suit land was sold by a registered sale deed. - We still, for our satisfaction have gone through the plaint placed on record at Annexure P/1 and we are unable to find the pleadings in support that she was a pardanasheen illiterate lady and was entitled for protection of law and the burden was on the defendant­appellant to prove that the alleged power of attorney was the result of fraud. After we have heard the parties, we are of the view that the High Court has committed a manifest apparent error in reversing the concurrent finding of the two Courts below and on this score the impugned judgment is not sustainable.

NON­REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S). 7137 OF 2010
ALI HUSSAIN(D) THROUGH LRS ….APPELLANT(S)
VERSUS
RABIYA & ORS.      ….RESPONDENT(S)
J U D G M E N T
Rastogi, J.
1. This appeal is directed against the judgment and decree
dated   18th  August,   2008   passed   by   the   High   Court   of
Uttarakhand in Second Appeal No. 1341 of 2001.
2. The facts in brief are that the first respondent­plaintiff filed
a suit against the defendant­appellant for cancellation of sale
deed dated 10th  May, 1995 registered in Sub­Registrar Office,
Jagadari, Roorkee on 22nd  May, 1995.   According to the plaint,
the plaintiff­first respondent Smt. Rabiya inherited the property
1
shown in the schedule of property indicated at the foot of the
plaint, from her father late Sri Ahamad and is the owner and in
possession   of   the   suit   property   in   question.     It   was   further
averred that the impleaded defendants in the suit (defendant
nos.1 and 3, Ali Hussain and Abdul Hassan) are the sons of her
great grandfather and impleaded defendant no. 2 Smt. Raquiba,
is the wife of Ali Hussain (impleaded defendant no. 1). 
3. It was averred in the plaint that the impleaded defendant
no.1   (appellant)   in   order   to   grab   the   suit   property   of   the 
plaintiff­respondent, got prepared a forged registered power of
attorney, in the name of the plaintiff­first respondent on 25th
April, 1995 and  on the basis of the forged power of attorney, sold
the suit property by a registered sale deed for a consideration of
Rs. 1,50,000/­ on 10th May, 1995 in favour of defendant nos. 2
and   3   (Smt.   Raquiba   and   Abdul   Hassan).     According   to   the
plaintiff­first respondent, the sale price of the suit property could
not be less than Rs. 3,00,000/­.  It is also alleged in the plaint
that there is no recital as to who had actually received the sale
consideration and she is in actual possession of the suit property
and the forged sale deed was never acted upon.  It was prayed for
2
the decree for cancellation of power of attorney and the sale deed
obtained by playing fraud.
4. Before   the   trial   Court,   on   the   basis   of   pleadings   of   the
parties, following issues were framed:­
1. Whether the sale deed dated 10.05.1995 executed by
defendant no. 1 in favour of defendant nos. 2 and 3
is liable to be cancelled on the grounds set in the
plaint?
2. Whether   the   alleged   power   of   attorney   dated
25.04.1995   executed   by   plaintiff   in   favour   of
defendant no. 1 is forged document and the plaintiff
did not execute the same? If so, its effect?
3. Whether the plaintiff received the sale consideration
in   respect   of   sale   deed   from   defendant   no.   1   in
favour of defendant nos. 2 & 3.
4. Whether the plaintiff is owner and in possession of
the property in dispute?
5. Whether the plaintiff is entitled for any relief?
6. Whether   after   selling   the   property   in   dispute   to
Mohammad   Mateen   by   the   plaintiff,   the   suit
rendered infructuous?
7. Whether the suit is barred by principle of estoppel
and acquiescence?
8. Whether the suit rendered infructuous in view of the
contention raised in para no. 13­A of the written
statement?
5. Both the parties adduced their oral as well as documentary
evidence   in   support   of   their   defence.     The   trial   Judge,   after
hearing   the   parties   and   considering   the   evidence   on   record,
dismissed   the   suit   filed   by   the   plaintiff­first   respondent   vide
3
judgment and decree dated 19th January, 2001 which was further
assailed at the instance of the plaintiff­first respondent in first
appeal which was dismissed vide judgment and decree dated 27th
August, 2001, further assailed in second appeal before the High
Court of Uttarakhand.
6. It may be relevant to note that at the time of admission of
second   appeal,   the   High   Court   admitted   the   appeal   on   the
following substantial questions of law:­
1. As to whether both the courts below were justified
placing burden of proof on the plaintiff/appellant to
prove   negative   fact   that   power   of   attorney   is   not
executed by her?
2.Whether burden/onus of proof lies on the transferee
when transferor totally denies execution of the deed
by himself? If so, its effect?
7. The High Court after hearing the parties proceeded on the
premise that the plaintiff­first respondent was the pardanasheen
illiterate lady and taking note of the judgment of this Court in
Mst.   Kharbuja   Kuer  Vs.  Jangbahadur   Rai   and   Others  AIR
1963 SC 1203, relying on the judgment of the Privy Council
(Farid­Un­Nisa(Plaintiff)   Vs.   Mukhtar   Ahmad   and
Another(Defendants) AIR 1925 PC 204) held that burden of proof
4
in such a case rest, not with those who attack, but with those
who found upon the deed, and the proof must go so far as to
show affirmatively and conclusively that the deed was not only
executed by, but was explained to, and was really understood by
the grantor.
8. The  High  Court held  that  the  burden  to  prove that  the
alleged   power   of   attorney   is   not   a   result   of   fraud   and
misrepresentation lie on the shoulder of the appellant­defendant
because they are the beneficiaries and the trial Court and the
first Appellate Court has committed a manifest error in shifting
the burden on the shoulders of the plaintiff­first respondent and
accordingly set aside the judgment and  decree of the  Courts
below and remitted the matter back to the trial Judge to decide
the suit afresh in view of the evidence available on record taking
note of the observations made by the High Court in the impugned
judgment dated 18th August, 2008 which is a subject matter of
challenge at the instance of the appellant­defendant no. 1 before
us.
5
9. This Court, while issuing notice on 14th  November, 2008
stayed   the   operation   of   the   impugned   judgment   dated   18th
August, 2008.
10. Learned counsel for the appellants submits that the very
foundation   on   which   the   High  Court   has  proceeded   that   the
plaintiff­first respondent was a pardanasheen illiterate lady and
shifting the burden of proof on the shoulder of the appellant­first
defendant to establish that the document was explained to the
plaintiff­first respondent and she understood it and thereafter
transaction was entered into, is against the pleadings on record.
From the perusal of the copy of the plaint annexure P/1 on
record filed by the plaintiff­first respondent, it is nowhere pleaded
that   she   was   a   pardanasheen   illiterate   lady   and   in   absence
whereof, the very proposition which has been examined by the
High Court under the impugned judgment is unsustainable and
so far as the issues which are framed by the trial Judge on the
basis of the pleadings on record, all have been negated against
the plaintiff­first respondent and in the given circumstances, the
finding recorded by the High Court in remitting the matter to the
6
trial Judge to revisit the same on the basis of principles laid
down deserves to be interfered by this Court.
11. Per   contra,   learned   counsel   for   the   respondents,   while
supporting the finding recorded by the High Court under the
impugned judgment, submits that it is indisputed fact that the
plaintiff­first respondent is a pardanasheen illiterate lady and
still the case was proceeded with the burden of proof on her
shoulders to establish that the power of attorney executed by the
plaintiff in favour of defendant­appellant was a forged document
was   a   patent   error   of   law.     In   the   given   circumstances,   the
burden   of   proof   was   upon   the   defendant   no.1­appellant   to
establish that the registered power of attorney executed on 25th
April, 1995 was a genuine document and only thereupon the
onus could have been shifted to the plaintiff­first respondent and
this is an apparent manifest error which was committed by the
trial   Judge   but   noticed   by   the   High   Court   in   the   impugned
judgment and it needs no further interference by this Court.
12. We have heard learned counsel for the parties and with
their assistance perused the material available on record.
7
13. The plaintiff­first respondent filed a Suit No. 155 of 1996
before the Civil Judge (J.D.), Roorkee.  A copy of the plaint has
been placed on record (Annexure P/1).  On perusal of the plaint,
it reveals that it has nowhere been pleaded that the plaintiff­first
respondent is a pardanasheen illiterate lady.   In the ordinary
course the burden of proof rest, on who attack.  On the contrary,
it was pleaded in the plaint that defendant nos.1 and 3 are the
sons of her uncle Mangta and defendant no. 2 is the wife of
defendant no. 1 and they hatched a conspiracy to grab the land
of the plaintiff­first respondent and with connivance, the power of
attorney was prepared & registered on 25th  April, 1995 in the
registry office, in the name of the plaintiff and pursuant thereto,
suit land was sold by a registered sale deed.   On the basis of
pleadings   on   record,   the   above­mentioned   eight   issues   were
framed   on   which   both   the   parties   have   adduced   oral   and
documentary evidence and the trial Judge, after considering the
evidence, dismissed the suit vide judgment and decree dated 19th
January, 2001 and that came to be affirmed on dismissal of the
appeal filed at the instance of the plaintiff­first respondent dated
27th August, 2001.  It reveals from the record that without there
being any factual foundation, the High Court, while admitting the
8
appeal, framed two substantial questions of law in reference to
which there was no supporting pleadings on record. 
14. We still, for our satisfaction have gone through the plaint
placed on record at Annexure P/1 and we are unable to find the
pleadings in support that she was a pardanasheen illiterate lady
and was entitled for protection of law and the burden was on the
defendant­appellant to prove that the alleged power of attorney
was the result of fraud.
15. After we have heard the parties, we are of the view that the
High Court has committed a manifest apparent error in reversing
the concurrent finding of the two Courts below and on this score
the impugned judgment is not sustainable. 
16. Consequently, the appeal succeeds and accordingly allowed.
The judgment of the High Court in second appeal dated 18th
August, 2008 is hereby set aside.  No costs.
9
17. Pending application(s), if any, stand disposed of.
..………………………………………J.
(N.V. RAMANA)
..………………………………………J.
(MOHAN M. SHANTANAGOUDAR)
.……………………………………….J.
(AJAY RASTOGI)
NEW DELHI
SEPTEMBER 17, 2019
10