2009 (10) TMI 750 - AT - Central Excise

Summary

Issues:
Grant of refund to the respondent by lower appellate authority, application of unjust enrichment doctrine, premature refund claim filed before finalization of provisional assessment.

Analysis:
The appeal was filed by the Department against the grant of a refund to the respondent (assessee) by the lower appellate authority. The respondent had initially claimed a refund of duty amounting to Rs. 6,03,695. The original authority rejected the claim, stating that the claimant had not proven that the duty incidence had not been passed on to the buyer. However, the appellate authority, in the appeal filed by the party, ruled that the bar of unjust enrichment would not be applicable in this case since the refund claim was made after the finalization of provisional assessment. Therefore, the assessee's appeal was allowed with consequential relief.

The learned SDR relied on the Supreme Court judgments in Mafatlal Industries v. Union of India and Commissioner v. Allied Photographic India Limited. The Tribunal considered the submissions of the learned SDR, along with the written submissions filed by the respondent, which included documents such as the order of finalization of provisional assessment dated 28-3-1996. It was noted that the refund claim was filed in February 1995, before the finalization of the provisional assessment. The Tribunal emphasized that no demand of duty could be raised or any refund allowed before the finalization of provisional assessment. The premature refund claim filed by the assessee before finalization of the provisional assessment was deemed premature. However, upon finalization of the provisional assessment, the respondent was entitled to a refund of the excess duty paid, unaffected by the doctrine of unjust enrichment under Section 11B of the Central Excise Act. The Tribunal upheld the lower appellate authority's decision to grant the refund, even though the reason cited by the authority was not accepted.

In conclusion, the Tribunal dismissed the Revenue's appeal, affirming that the respondent was entitled to a refund of the excess duty paid upon the finalization of the provisional assessment, regardless of the doctrine of unjust enrichment.