2011 (3) TMI 1227 - AT - Central Excise

Refund - unjust enrichment - Held that - If the appellant is able to produce evidence regarding the payment of duty which has been claimed as refund by them and allowed by the adjudicating authority, the refund would be eligible to them subject to passing of hurdle of unjust enrichment. Since such evidence is produced before us for the first time, the matter should be reconsidered by the ld. Commissioner (Appeals) again - remit matter back to the first appellate authority to reconsider the issue afresh from the angle of unjust enrichment - assessee s appeal is allowed by way of remand.

Summary

Issues involved:
Refund claim under Section 11B of the Central Excise Act, burden of proof regarding payment of duty, unjust enrichment.

Analysis:
The appeal was filed against an Order-in-Appeal that set aside the refund sanctioned to the appellant. The issue revolved around a refund claim of Rs.21,49,965 paid by the assessee following original orders passed in 1995. The first appellate authority set aside these orders, leading to the refund claim. The ld. Commissioner (Appeals) emphasized the requirements of Section 11B of the Central Excise Act, which necessitates evidence to establish that the duty amount was paid and not passed on to others. The Commissioner found discrepancies in the evidence submitted by the respondent, indicating non-payment against the original orders. Additionally, the burden of unjust enrichment was not adequately addressed by the respondent, lacking concrete proof that the duty burden was not transferred to buyers.

The appellant argued that the findings of the Commissioner (Appeals) were erroneous and claimed to possess documents proving payment. However, these documents were not presented before the Commissioner (Appeals). The Tribunal acknowledged the potential eligibility of the refund if evidence of duty payment was provided, subject to unjust enrichment considerations. As the evidence was newly presented before the Tribunal, the matter was remitted back to the first appellate authority for a fresh review considering the principles of natural justice. Consequently, the impugned order was set aside, and the appeal was allowed for remand.