2008 (1) TMI 694 - AT - Central Excise

Refund - Unjust enrichment - Held that - other than relying upon the Chartered Accountant s certificate that the assessee have not charged AED under the Additional Duties of Excise (Textiles & Textiles) Act 1978 to their customers there is nothing on record to rebut the presumption in law that the burden of duty must have been passed on to the customers - Since the burden of proving that the incidence of duty has not been passed on to their customers has not been discharged by them I see no reason to interfere with the impugned order of rejection of refund claim - appeal dismissed - decided against Revenue.

Summary

Issues:
Claim for refund of duty directed to consumer welfare fund instead of being paid to the appellants due to failure to show non-passing on of duty incidence to customers.

Analysis:
The judgment revolves around the issue of the refund claim of duty amounting to Rs. 4,82,445/- being sanctioned but directed to be credited to the consumer welfare fund under Section 12C of the Central Excise Act, 1944, instead of being paid to the appellants. The reason behind this direction was the failure of the appellants to demonstrate that they did not pass on the burden of duty to their customers.

The judge, after hearing both sides, noted that the appellants primarily relied on a Chartered Accountant's certificate to prove that they did not charge the Additional Duties of Excise to their customers. However, apart from this certificate, there was no other evidence on record to rebut the legal presumption that the duty burden was passed on to the customers. The appellants later produced another certificate from the same Chartered Accountant, stating that during the disputed period, they did not recover the duty from customers. Despite this additional certificate, the judge found it insufficient to discharge the burden of proof placed on the appellants.

Since the appellants failed to sufficiently prove that the duty incidence was not passed on to customers, the judge upheld the decision of rejecting the refund claim. The judge emphasized that without discharging the burden of proof, there was no basis to interfere with the initial order. Consequently, the appeal was rejected, and the decision of directing the duty amount to the consumer welfare fund was affirmed.