2004 (2) TMI 514 - AT - Central Excise

Summary

Issues involved:
Applicability of doctrine of unjust enrichment to the refund claim of the appellants.

Analysis:
The judgment by the Appellate Tribunal CESTAT, New Delhi, focused on the single issue of the applicability of the doctrine of unjust enrichment to the refund claim of the appellants, directed against the impugned order-in-appeal passed by the Commissioner (Appeals). The Tribunal noted that the appeal raised arguable points and was admitted for consideration, emphasizing that the controversy was narrow in scope.

The Tribunal examined the facts of the case, highlighting that the Social Security Cess was paid by the appellants in a lump sum without passing it on to the buyers. The adjudicating authority had initially rejected the refund claim, but the Commissioner (Appeals) allowed the refund, directing that it be deposited in the Consumer Welfare Fund on the basis that the appellants had passed on the incidence of the cess to the buyers. However, the Tribunal found that the impugned order of the Commissioner (Appeals) contradicted the allegations made in the show cause notice, which clearly stated that the burden of the Cess had been borne by the appellants themselves and was not recovered from the buyers.

In light of these discrepancies between the show cause notice and the Commissioner (Appeals) order, the Tribunal concluded that the doctrine of unjust enrichment could not be invoked to hold that the incidence of the Cess had been passed on to the buyers. The Tribunal further noted that the deposit of the Social Security Cess had been made by the appellants after the clearance of the goods, reinforcing the finding that the burden was not shifted to the buyers. Consequently, the Tribunal set aside the impugned order of the Commissioner (Appeals) and allowed the appeal of the appellants, granting any consequential relief permissible under the law.