2011 (7) TMI 919 - AT - Central Excise

Cash refund - unjust enrichment - The duty claimed as refund had been paid on an intermediate product of theirs, which was captively consumed in the manufacture of their final product which was cleared without payment of duty by virtue of the tariff rate of duty being nil - It appears,Chartered Accountant s certificates were considered as evidence against bar of unjust enrichment in some of the cases cited before us - the matter has to be reconsidered by the original authority which did not have the benefit of the documentary evidence referred to by the learned consultant, nor the benefit of any case law cited before us - Decided in favor of the assessee by way of remand

Summary

Issues:
Denial of cash refund based on unjust enrichment.

Analysis:
The appeal was filed against the denial of cash refund of duty due to unjust enrichment. The duty claimed as refund was paid on an intermediate product consumed in the manufacture of a final product cleared without duty payment. The refund claim was held admissible only to a certain extent, with the amount ordered to be credited to the Consumer Welfare Fund. The appellate authority upheld the decision, rejecting the documents presented by the appellant as evidence against unjust enrichment, noting that the duty amount was not separately shown in the final product invoices. The appellant argued that the duty amount was always shown as 'recoverable' in their balance sheets and provided a Cost Accountant's certificate to support their claim that the duty was not passed on to customers. The appellant requested a reconsideration of the case with the submission of additional evidence.

The appellate tribunal found that the matter required reconsideration by the original authority, as they did not have the benefit of the documentary evidence and case law presented during the appeal. The tribunal set aside the lower authorities' orders and remanded the case to the original authority for a fresh decision. The appellant was granted the opportunity to provide further documentary evidence and be personally heard. They were allowed to submit relevant balance sheets, certificates from a Chartered Accountant, and any other supporting documents to prove that the duty incidence was not passed on. The appellant could also seek support from judicial authorities. The 'cross objections' were also disposed of for the record.