2013 (2) TMI 368 - AT - Customs

Unjust enrichment - Consumer welfare fund - Whether the assessee have proved that the duty burden was passed on by the assessee to the consumers or not - Assessee imported raw petroleum coke - Paid cess u/s 7 of the Coal Mines (Conservation and Development) Act, 1974 Held that - The assessee were only relying on the Chartered Accountant s certificate which was considered by the authorities below and it was held that the certificate did not indicate the basis on which the certification has been made and hence questioning the veracity of the certificate. Undisputedly, the burden to prove that the amount paid as cess (Customs duty) was not passed on to the consumers was on the appellants which they have failed to discharge satisfactorily. In favour of revenue

Summary

Issues:
1. Whether the appellants are entitled to a refund of cess paid under the Coal Mines (Conservation and Development) Act, 1974.
2. Whether the cess collected by the Department can be equated with Customs duty/Excise duty for the application of unjust enrichment.
3. Whether the burden of proving that the cess amount was not passed on to consumers lies with the appellants.

Analysis:
Issue 1:
The appellants imported raw petroleum coke and paid cess under the Coal Mines Act. They filed a refund claim stating that no cess was due on by-products as the levy was only on coal. The original authority accepted that no cess was payable by the appellants but deposited the refund into the consumer welfare fund. The Commissioner (Appeals) upheld this decision.

Issue 2:
The appellant argued that the cess collected under the Coal Mines Act should not be treated as Customs duty/Excise duty, citing a Gujarat High Court decision and a Tribunal case. The Deputy Commissioner contended that the cess is akin to Customs duty as it is imposed on imported goods. He referenced Tribunal cases supporting the application of unjust enrichment to cess.

Issue 3:
The Tribunal noted that the nature of levy must be determined based on the taxable event, which in this case was "import." While the original authority approved the refund, the dispute centered on whether the appellants proved that the cess burden was not passed on to consumers. The appellants presented a Chartered Accountant's certificate, but it was deemed insufficient as it lacked a clear basis. The burden of proof lay with the appellants, and as they failed to discharge it satisfactorily, the findings of the lower authorities on unjust enrichment were upheld.

The Tribunal rejected the appeal, emphasizing that the decisions cited by the appellants did not support their case. The judgment highlighted that the burden of proving non-passing of cess burden to consumers rested on the appellants, which they failed to do effectively.