2013 (10) TMI 942 - AT - Central Excise

Refund Claim Pre-deposits made by holding company - Appellant the subsidiary of a company had to made a pre-deposit of Rs.2 lakhs as per the directions of the Tribunal to hear the appeal, the pre-deposit was made by GSIL and not by the appellant - Held that - The appellant/assessee produces the documentary evidence to show that the amount is treated as receivables and not collected from the customers and further it was shown as receivables, it becomes a rebuttable evidence and Revenue has to make some efforts to rebut this and the refund cannot be denied on the basis of assumptions and presumptions that the same might have been passed on by adding to the cost - In the absence of any rebuttal by the Revenue and in the absence of any evidence to show that this amount was collected and in the presence of positive evidence produced by the appellant, the appellant has a valid claim for refund - As far as the payment of GSIL is concerned, the appellant was a subsidiary of GSIL and now both have become one company and on the ground that amount was paid by GSIL and not by the appellant, refund cannot be denied Decided in favour of Assessee.

Summary

Issues:
1. Refund claim eligibility and waiver of pre-deposit.
2. Justification of refund claim and unjust enrichment.
3. Interpretation of evidence regarding payment by the holding company.
4. Rebuttable evidence and denial of refund based on assumptions.

Analysis:
1. The appellant, a subsidiary of a company, made a pre-deposit as directed by the Tribunal. The matter was decided in favor of the appellant, making them eligible for a refund of the deposit. However, the Revenue filed an appeal seeking the deposit amount. The Commissioner (A) allowed the appeal, leading the appellant to request a stay against recovery and waiver of pre-deposit.

2. The Commissioner (A) rejected the refund claim, stating that the amount was paid by the holding company and not by the appellant. The Commissioner highlighted various pieces of evidence, including Chartered Accountant certificates and ledger extracts, to support the claim that the holding company had made the payment. The Commissioner concluded that refunding the amount to the appellant would result in unjust enrichment.

3. The presiding judge disagreed with the Commissioner's decision. Upon reviewing the balance sheets and records of both the appellant and the holding company, it was evident that the amount in question had been consistently shown as receivable and lying with the Government. The judge emphasized that the appellant had provided documentary evidence to support their claim, which the Revenue failed to rebut. The judge also noted that the appellant and the holding company had merged, making the distinction between the entities irrelevant for the refund claim.

4. The judge ultimately allowed the appeal, recognizing the validity of the appellant's claim for a refund. The decision was based on the lack of evidence from the Revenue to counter the appellant's documented proof regarding the treatment of the amount in question. The judge emphasized that refund denial cannot be based on assumptions of passing on costs without concrete evidence. The appeal was allowed, granting consequential relief to the appellant.