2003 (9) TMI 495 - AT - Central Excise

Summary

Issues: Refund admissibility based on credit notes issued after clearances, interpretation of duty incidence passed on to customer.

In this case, the Assistant Commissioner initially held that refund was not admissible due to credit notes being issued after clearances. However, on appeal, the Commissioner (Appeals) allowed the appeal stating that the refund was not affected by Section 11B of the Act. The Revenue's representative cited a decision by a Larger Bench in S. Kumar's Limited case, emphasizing the binding nature of dismissed civil appeals as precedent. The decision highlighted the importance of following precedent set by higher courts. The Counsel for the respondents argued that if the price structure of the product remained unchanged after an increase in duty rate, it cannot be assumed that the duty incidence was passed on to the customer, referencing the Swarup Fibre Industries Limited case.

Upon careful consideration, the judge found the issues to be interconnected. As the party in this case issued credit notes post-clearances, it aligned with the Larger Bench decision cited by the Revenue. The judge disagreed with the argument that duty incidence was not passed on to the customer, in line with the precedent set by the Larger Bench. Consequently, the judge accepted the Revenue's plea, leading to the allowance of the appeal.