2011 (1) TMI 320 - AT - Central Excise

Rebate claim - Unjust enrichment - During the period 18-1-2008 to 27-2-2008 the UT-1 expired, and the appellant exported goods under Rule 18 - There is no dispute that the goods have been exported and that they have duly accounted for - There is no dispute that they paid duty through TR-6 challans - Therefore, the refund claim has to be under the provisions of Section 11B - Thus, the question of unjust enrichment will not be applicable to this case as it involve export of goods - Issue regarding refund is concerned, since the same has not been considered as per the provisions of Section 11B, the case is remanded to the adjudicating authority for re-examining the case under Section 11B without going into the aspect of unjust enrichment.

Summary

Issues:
Waiver of pre-deposit of penalty, Refund claim under Section 11B of the Central Excise Act, Validity of UT-1 for export, Imposition of penalty for contravention of rules.

Waiver of Pre-deposit of Penalty:
The applicant/appellant filed for waiver of pre-deposit of a penalty of Rs. 5,000 imposed by the lower adjudicating authority. The judge, after hearing both sides, decided to dispose of the appeal without the pre-deposit requirement, allowing the appeal to proceed for disposal.

Refund Claim under Section 11B of the Central Excise Act:
The appellant, engaged in manufacturing excisable goods, exported goods under Rule 18 but failed to renew their UT-1, resulting in the export of 9 consignments without UT-1 cover. The appellant paid the duty on these consignments and filed a refund application under Section 11B. The adjudicating authority considered the claim under Rule 18 instead of Section 11B, imposing a penalty of Rs. 5,000. The appellant contended that their refund claim fell under Section 11B, citing relevant case law. The judge remanded the case to the adjudicating authority to re-examine the claim under Section 11B, upholding the penalty imposition.

Validity of UT-1 for Export:
During the period in question, the UT-1 expired, and the appellant exported goods under Rule 18 without a valid UT-1. The appellant filed a refund claim under Section 11B after fulfilling the export obligation. Both parties agreed that the question of unjust enrichment did not apply due to the export nature of the goods. The judge remanded the case for re-examination under Section 11B, without delving into the penalty issue, ensuring a fair hearing for the appellant.

Imposition of Penalty for Contravention of Rules:
The learned SDR argued that the appellant exported goods under an invalid UT-1, suggesting the claim should be considered under rebate, not refund of duty. The judge upheld the penalty imposition of Rs. 5,000 for contravention of rules, as the appellant did not contest this aspect. The judge focused on the refund claim under Section 11B, remanding the case for further examination while maintaining the penalty decision.

In conclusion, the appellate tribunal remanded the case for re-examination under Section 11B of the Central Excise Act, emphasizing the need for a fair hearing and upholding the penalty imposition. The decision highlighted the importance of correctly applying legal provisions in refund claims and ensuring procedural fairness in adjudication processes.