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2005 (9) TMI 370 - AT - Central Excise
Issues:
1. Whether the refund claim on duty paid on an enhanced value but not reimbursed by the consignee is refundable. Analysis: The appeal was filed by the Revenue against the order of the Commissioner of Central Excise (Appeals), Mumbai. The respondents, who are manufacturers of blast pre-heater glandone coil assembly, entered into a contract for supply of goods and filed a declaration seeking approval of the price. The approved price was Rs. 20,42,857/- for 56 coils. Subsequently, the respondents cleared the goods at an enhanced price, hoping to recover it from buyers who refused to pay the extra amount. The respondents then claimed a refund of duty paid on this extra amount. The lower authority rejected the claim, stating that the enhanced price is correct and duty is payable on it. However, the Commissioner (Appeals) held that the claim for refund should be reevaluated and modified. The main issue was whether the extra duty paid on the enhanced price, not approved by the department, is refundable. During the hearing, it was noted that the department had approved the price declared by the respondents under Rule 173C of the Erstwhile Central Excise Rules. Generally, duty is paid based on the approved price list. In this case, the respondents paid more duty by enhancing the price themselves. The critical point was the extra duty paid on the enhanced price compared to the approved price, which the consignee refused to pay. It was evident that the respondent did not pass on the duty incidence to the buyer. The extra duty was paid on a price different from the approved one. The Tribunal found that the claim for refund of the extra duty was justified as it was not in accordance with the approved price. Refund under Section 11B can be granted to a person meeting the section's provisions. The Tribunal agreed with the Commissioner (Appeals) that the respondent was entitled to the refund, and upheld his decision. In conclusion, the Revenue's appeal was dismissed, and the Tribunal upheld the Commissioner (Appeals) decision to allow the refund claim.
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