2011 (10) TMI 414 - AT - Central Excise

Principle of Unjust Enrichment - Onus to Proof - In view of Commissioner of Central Excise, Mumbai-II Vs. Allied Photographics India Ltd (2004 -TMI - 46926 - SUPREME COURT OF INDIA), case decided against assessee.

Summary

Issues:
- Appeal against refund claim allowed by Commissioner (Appeals)
- Burden of duty passed on to customer
- Principle of unjust enrichment and onus on assessee
- Application of decision in Commissioner of Central Excise, Mumbai-II Vs. Allied Photographics India Ltd.

The judgment by the Appellate Tribunal CESTAT, Mumbai, involved an appeal against a refund claim allowed by the Commissioner (Appeals). The Revenue contended that the burden of duty had been passed on to the customer, challenging the Commissioner's finding that the burden had not been passed on. The Revenue relied on the decision in Commissioner of Central Excise, Mumbai-II Vs. Allied Photographics India Ltd. The Tribunal noted that refund claims are subject to the principle of unjust enrichment, placing the onus on the assessee to demonstrate that the burden of duty had not been passed on. The Commissioner (Appeals) had held that the higher duty collected had been absorbed in the profit margin, leading to goods being sold at the same price without an increase in Central Excise duty. However, the Tribunal, citing the Supreme Court decision in Allied Photographics India Ltd., emphasized that uniformity in price before and after assessment did not conclusively prove that the duty burden had not been passed on. Consequently, the Tribunal set aside the impugned order and allowed the appeal, highlighting the importance of considering various factors beyond price uniformity in determining the passing on of duty burden.

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