2013 (12) TMI 221 - AT - Central Excise

Refund claim hit by bar of unjust enrichment or not - Clearance from the factory gate - Assessee contended that the factory gate sale price was available, thus there was no requirement of adopting depot sale price and demanding differential duty Held that - The deposit of duty by the appellant was in respect of number of clearances made from the factory gate and the amount was debited as a result of demand made by their jurisdictional central excise authorities - such deposit of amount was in the nature of deposit made after clearances and at the instructions of the Revenue, which has been held to be as not payable by the Tribunal - clearances had also been effected, there is no evidence on record that the appellant subsequently recovered the amount from their customers - the refund claim of is not hit by bar of unjust enrichment order set aside Decided in favour of Assessee.

Summary

Issues:
1. Refund claim rejection based on unjust enrichment.

Analysis:
The appellant, a manufacturer of M.S. Bars, cleared goods from the factory gate and depot. A demand of Rs. 37,532 was raised by the Range Superintendent for clearances made from the factory gate during April to September 1994, which the appellant paid in January 1995. Subsequently, a refund claim was filed by the appellant, contending that no differential duty was required due to the availability of factory gate sale price without adopting depot sale price. The original adjudicating authority rejected the refund claim, but the Commissioner (Appeals) allowed it. The Revenue appealed to the Tribunal, which favored the assessee on merits but remanded the matter to examine unjust enrichment.

In the de novo proceedings, both lower authorities rejected the refund claim on the basis of unjust enrichment. The crucial issue in the present appeal was whether the refund claim was affected by unjust enrichment. The appellant debited the amount of Rs. 37,532 from their accounts after objection by central excise authorities, without issuing supplementary invoices. The Tribunal found that the deposit was made post-clearance and at the Revenue's instruction, which was later deemed non-payable. There was no evidence that the appellant recovered the amount from customers. Therefore, the Tribunal concluded that the refund was not barred by unjust enrichment, as the appellant did not pass on the amount to customers. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant with consequential relief.