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2013 (9) TMI 652 - AT - Central ExciseRefund claim - Unjust enrichment - finalization of provisional assessment - Held that - Even under the amendment made by Notification No.45/99-CE (NT) dt . 25.06.1999 only the procedure established under sub-sec. (2) of sec. 11 B of Central Excise Act 1944 has been made applicable to the refunds arising out of finalization of provisional assessments under Rule 9B of the Central Excise Rules 1944. Accordingly the procedure regarding application of unjust enrichment to refunds on finalization of provisional assessments will be applicable to the provisional assessments made after 25.06.1999 and not before that date. The addition of proviso to Rule-9 B (5) has not been made with retrospective effect. Based on the ratio of the law laid down by Hon ble Supreme Court in the case of CCE in the case of Commissioner of Customs Vs Hindalco (2008 (9) TMI 372 - HIGH COURT OF GUJARAT AT AHMEDABAD) the doctrine of unjust enrichment will therefore not be attracted to the refunds pertaining to the finalization of provisional assessments for period prior to 25/06/1999 when the linking proviso under Rules 9B(5) of Central Excise Rules 2004 was not existing. The linking provision under proviso to Rule 9B( 5) was made by an amendment with effect from 25.06.1999 and will be applicable only w.e.f . 25.06.1999 -Following decision of Commissioner of Customs vs. Hindalco Industries Ltd. 2008 (9) TMI 372 - HIGH COURT OF GUJARAT AT AHMEDABAD - Decided against Revenue.
Issues involved:
Adjustment and refund of duties at the time of finalization of provisional assessments; Applicability of the doctrine of unjust enrichment to the refund of duty finalized after 25/06/1999 but pertaining to the period prior to 25/06/1999. Detailed Analysis: 1. Adjustment and Refund of Duties: The issue in these appeals revolved around the adjustment and refund of duties during the finalization of provisional assessments. The question at hand was whether the doctrine of unjust enrichment would apply to the refund of duty finalized post-25/06/1999 but related to the period before this date. The matter was referred to the larger bench due to conflicting views on this issue. 2. Applicability of Unjust Enrichment: During the disputed period of 01/01/1987 to 31/05/1998, there was a disagreement regarding the determination of assessable value under the Central Excise Act, 1944. The appellant's company paid excise duty provisionally under Rule-9B of the Central Excise Rules 1944. The jurisdictional Assistant Commissioner finalized the provisional assessments post a High Court order, leading to a demand for payment. The application of the first proviso to Rule-9B(5) was a point of contention, with arguments presented based on various judgments. 3. Legal Arguments - Appellant's Perspective: The appellant's advocate argued that the first proviso to Rule-9B(5) was added only from 25/06/1999 onwards and should not be retroactively applied to refund claims from periods before this date. Several judgments were cited to support this stance. 4. Legal Arguments - Revenue's Perspective: The Revenue's representative contended that the amendment in Rule-9B of the Central Excise Rules in 1999 was clarificatory and should apply to refund claims arising post-25/02/1999, even for periods preceding 25/06/1999. Supporting judgments were cited to bolster this argument. 5. Judgment and Analysis: After considering the submissions, the bench analyzed the relevant laws and amendments. The concept of unjust enrichment was introduced to Central Excise refunds under Section 11B by an amendment in 1991. The bench highlighted the proviso added to Rule-9B(5) post an amendment in 1999, emphasizing the procedure for finalization of provisional assessments and refunds. The judgment also delved into the Customs Act amendments and the applicability of the doctrine of unjust enrichment to refunds before 13/07/2006. 6. Interpretation of Precedent: The judgment referred to the Gujarat High Court's interpretation of the amendments in the Customs Act and the doctrine of unjust enrichment. The distinction between making a refund and claiming a refund was emphasized, along with the non-retrospective nature of certain amendments. The judgment also discussed the applicability of the doctrine of unjust enrichment to refunds for periods up to 12/07/2006. 7. Final Decision: Based on the analysis of relevant laws and precedents, the bench ruled in favor of the assessee, stating that unjust enrichment would not apply to refunds related to finalization of provisional assessments for periods before 25/06/1999. The linking proviso under Rule 9B(5) was deemed to be applicable only from 25/06/1999 onwards. The decision was made keeping in mind the Supreme Court's stance on the issue, and the regular bench was directed to proceed accordingly with the main appeals based on this larger bench's view. This detailed analysis covers the issues of adjustment and refund of duties, the application of the doctrine of unjust enrichment, legal arguments from both sides, the judgment's interpretation of relevant laws and precedents, and the final decision reached by the bench.
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