2012 (8) TMI 843 - AT - Central Excise

Refund claim - No provisional assessment during the period of dispute - Held that - though the supplies to MP State Electricity Board had been made during the period of dispute against a contract with price variation clause there was no provisional assessment. It is settled law that when there is no provisional assessment and the duty is paid on the goods in terms of the price quoted in the invoices at the time of clearance from factory subsequent reduction of price cannot be the basis for claim under refund of duty. In this case other than a letter issued by an official of MP State Electricity Board no evidence has been produced by the respondent in support of their claim that the price had been revised downward before the clearances of the goods in question. In view of this the impugned order is not correct - Decided in favour of Revenue.

Summary

Issues:

1. Refund claim rejection due to lack of provisional assessment.
2. Interpretation of law regarding price revision and duty refund eligibility.

Issue 1: Refund claim rejection due to lack of provisional assessment

The case involved a respondent who manufactured transformers and carried out repairs, supplying transformers to the MP State Electricity Board against a contract during a specific period. The respondent filed a refund claim after the Electricity Board revised prices downwards. The Jurisdictional Assistant Commissioner rejected the claim citing the absence of provisional assessment during the dispute period. The Commissioner (Appeals) later set aside this decision, leading to an appeal by the Revenue.

Issue 2: Interpretation of law regarding price revision and duty refund eligibility

The Departmental Representative argued that without provisional assessment, price reductions post-clearance cannot be the basis for a refund claim, citing a judgment by the Punjab & Haryana High Court. The Counsel for the respondent contended that since the price revision occurred after a significant portion of clearances, the refund should be granted as duty was paid at a higher price than received. The Tribunal noted the absence of evidence supporting the respondent's claim of price revision before clearance and upheld the Revenue's appeal, setting aside the previous order and restoring the original Adjudicating Authority's decision.

---