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2007 (6) TMI 450 - AT - Central ExciseRefund of pre-deposit - Amount paid pursuant to Court order - unjust enrichment - whether amounts paid by way of pre-deposit (in this case the amount was paid pursuant to court order) attract the doctrine of unjust enrichment? - Held that - the issue is no more res-integra and is settled by the decision in the case of SAHAKARI KHAND UDYOG MANDAL LTD. Versus COMMISSIONER OF C. EX. CUS. 2005 (3) TMI 116 - SUPREME COURT OF INDIA , where it was held that Before claiming a relief of refund, it is necessary for the petitioner/appellant to show that he has paid the amount for which relief is sought, he has not passed on the burden on consumers and if such relief is not granted, he would suffer loss. The present claim for refund is also required to be tested on the anvil of unjust enrichment. Since the claim requires to be examined from this angle, I set aside the impugned order and remand the case to the Commissioner (Appeals) for examination - appeal allowed by way of remand.
Issues:
1. Application of the doctrine of unjust enrichment to amounts paid by way of pre-deposit for refund claims. Analysis: The judgment deals with the issue of whether the doctrine of unjust enrichment applies to amounts paid by way of pre-deposit for refund claims. The Revenue contested the order of the Commissioner (Appeals), arguing that the bar of unjust enrichment should apply to the refund of Rs. 2,72,532.59 to the respondents. The Tribunal had previously accepted the assessees' claim for exemption under Notification 208/82-C.E. The Revenue's contention was that the refund claim was hit by the bar of unjust enrichment as the respondents had not proven that they did not pass on the duty burden to their customers. The judge noted that the issue of whether amounts paid by way of pre-deposit attract the doctrine of unjust enrichment had been settled by the apex court in various cases. The judge cited decisions such as Sahakari Khand Udyog Mandal Ltd. v. CCE, CCE v. Parle International Ltd., and UOI v. Jain Spinners Ltd. The judge also referred to the Tribunal's decision in Pride Foramer v. CC, Mumbai, where the appellants demonstrated that the duty burden was not passed on, entitling them to a refund. The judge emphasized that the apex court's decisions and the Tribunal's orders should guide the application of the doctrine of unjust enrichment. Based on the Supreme Court's decisions in Jain Spinners Ltd. and Parle International Ltd., as well as the Tribunal's decision in Pride Former, the judge accepted the Revenue's contention that the refund claim needed to be tested for unjust enrichment. Consequently, the judge set aside the impugned order and remanded the case to the Commissioner (Appeals) for a fresh examination to determine whether the respondents had passed on the duty burden to their customers. The judge emphasized the need for a reasonable opportunity of hearing to be extended to the respondents during this process. In conclusion, the appeal was allowed by way of remand, and the case was to be reexamined by the Commissioner (Appeals) to ascertain whether the doctrine of unjust enrichment applied to the refund claim based on the principles established by the apex court and Tribunal decisions. (Pronounced in Court on 27-6-07)
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