2007 (5) TMI 126 - AT - Central Excise

Refund - Revenue contended that appellant is not liable for refund on the ground that they had unable to prove that amount of refund claim had not passed on their customer - Held that the revenue contention was not justified and allowed refund

Summary

Issues:
Refund claim based on denial of Modvat/Cenvat credit; Burden of proof on passing refund amount to customer; Interpretation of TR-6 challan as deposit under protest; Applicability of relevant case laws on refund of pre-deposit under Section 35F; Unjust enrichment and limitation provisions in refund cases.

Analysis:
The appeal before the Appellate Tribunal CESTAT, Mumbai was against Order-in-Appeal No. PI/439/05 dated 30-11-2005. Despite the absence of respondents, the appeal was taken up for disposal due to the narrow compass of the issue. The learned S.D.R. argued that the appellants failed to provide documentary evidence showing that the refund amount had not been passed on to their customer. The Tribunal considered the submissions and records regarding a refund claim arising from the denial of Modvat/Cenvat credit on certain items. The Commissioner of Central Excise, Pune -I directed the payment, which was done under protest and appealed by the respondent. The Tribunal's order in favor of the respondent became final as the revenue did not appeal against it. Therefore, the amount paid under protest was deemed refundable to the respondent.

The Commissioner (Appeals) analyzed the case, noting the deposit under protest and reliance on a Board Circular regarding refund of such deposits upon appeal success. Citing relevant case laws like CCE, Nasik v. Siemens Ltd., National Leather Manufacturing Co. v. CO & CE., and Mahindra & Mahindra Ltd. v. CCE, Mumbai, the Commissioner concluded that the appellant was entitled to the refund based on the Tribunal's decision allowing Modvat credit and the Board's circular. The Commissioner upheld the appeal, emphasizing the inapplicability of unjust enrichment due to the nature of the deposit and the Tribunal's decision. The Tribunal affirmed the Commissioner's decision, stating that the impugned order was legally sound and correctly applied the law settled by the Tribunal in similar situations, leading to the rejection of the Revenue's appeal.

In conclusion, the judgment highlighted the importance of proper documentation and legal precedents in refund cases involving deposits under protest and the applicability of relevant case laws. The decision underscored the significance of following established legal principles and interpretations in determining refund eligibility, particularly concerning unjust enrichment and limitation provisions in such matters.