New Delhi, May 19 (Reporter) In a significant relief to Patanjali-owned Ruchi Soya Industries Ltd, the Supreme Court on Monday allowed its appeal challenging a Gujarat High Court judgment that had denied the company a refund of customs duty recovered by the authorities through encashment of a bank guarantee. A bench comprising Justice Abhay S. Oka and Justice Ujjal Bhuyan held that the customs department’s claim was barred by the doctrine of unjust enrichment and criticised the coercive recovery of funds. “The customs had recovered the duty amount using coercive methods. In the facts of the case, encashment of the bank guarantee cannot be treated as recovery of customs duty. They could have waited for the outcome before this Court (in a related case). “The respondents have no authority in law to retain the money. Retention of such amount will carry 6% interest. Let the amount be released within four months from today,” the court ordered. The dispute dates back to September 2002, when Ruchi Soya imported crude, degummed soyabean oil of edible grade at the Jamnagar Port. Customs authorities demanded duty based on tariff values under Section 14(2) of the Customs Act, 1962, rather than the transaction value under Section 14(1). Ruchi Soya contended that the relevant tariff notification was not in the public domain at the time and thus unenforceable. The Gujarat High Court had allowed provisional clearance of the goods upon furnishing of a bank guarantee for the differential duty. However, in 2012, the High Court dismissed the writ petition, vacating interim relief. Customs authorities immediately encashed the bank guarantee and recovered ₹9.19 lakh. In a key turning point, the Supreme Court's 2015 ruling in Union of India v. Param Industries Ltd. held that tariff notifications must be publicly available to be enforceable. Relying on this, Ruchi Soya sought a refund, which was rejected by customs on the grounds of Section 27 of the Customs Act, arguing the refund was barred due to unjust enrichment. Fresh writ petitions filed in 2015 were dismissed by a division bench of the Gujarat High Court in 2016, which ruled that once interim relief had been vacated, the encashed guarantee constituted a duty paid, subject to statutory refund procedures. The Supreme Court disagreed with this view, distinguishing the coercive nature of the encashment and reaffirming the principle that the amount could not be treated as lawful duty unless the demand was legally sustainable. Ruchi Soya, acquired by Patanjali Ayurved in 2019 for ₹4,350 crore through an NCLT-approved resolution plan, now functions as a key arm of the Patanjali group. The Court’s decision may have financial implications for the company post-resolution. Ruchi Soya was represented by Senior Advocate Balbir Singh, along with Advocates Rajesh Rawal, Karan Sachdev, and Ashwani Kumar. The Union of India and the customs department were represented by Senior Advocates Nisha Bagchi and Nalin Kohli, with Advocates Sarthak Karol, Abhishek Singh, Pratyush Srivastava, and Krishna Prasad...////...