2015 (9) TMI 38 - AT - Central Excise

Denial of refund claim - whether refund is hit by limitation and doctrine of unjust enrichment would apply and whether appellants are eligible for refund as per the rate contract issued by TWAD Board w.e.f. 28.3.98 - Held that - Appellant cleared the goods on payment of duty from March 98 to August 98 whereas the claim was filed on 27.11.98. Therefore refund claim pertaining to excise duty paid for the period March 98 and April 98 and partly May-98 are hit by limitation as time-barred for the reason that as per Section 11B of Central Excise Act, the relevant date is the date of payment of excise duty and the claim has to be filed within a period of 6 months from the date of payment of duty. Therefore, the refund claim for the period 28.3.98 to 27.5.98 is time barred and the refund for the period 28.5.98 to 31.8.98 is not hit by limitation - appellant supplied PCC pipes to TN Government and it is a government body which is governed by the rate contract issued by TWAD Board every year. Prima facie, the refund claim relates to duty paid for the intervening period after the end of the financial year 1997-98 and pending receipt of revised rate contract from TWAD Board for the year 1998-99 and the appellant had cleared the goods as per the rate contract price of the previous year 1997-98. This fact has been clearly seen from the letter dt. 28.10.98 issued by Joint Chief Engineer, TWAD Board to the appellant. As per the conditions of the said letter, the revised rate was fixed for 1998-99 but issued only on 28.10.98. By respectfully following the Apex Court s decision 2015 (5) TMI 492 - SUPREME COURT , I hold that appellants are eligible for refund for the period from 28.5.98 to 31.8.98. As regards on the question of unjust enrichment, I find that unjust enrichment clause is not applicable in the present case as the TWAD Board has not paid any excess excise duty to the appellant and appellant had collected only the price as per the rate contract for the year 1998-99 - Refund is time barred for the period from 28.3.1998 to 27.5.1998 - the appellant is eligible for refund for the period 28.5.98 to 31.8.98 - Decided partly in favour of assessee.

Summary

Issues:
Refund claim based on excess excise duty paid, limitation period for filing refund claim, unjust enrichment, eligibility for refund as per rate contract issued by TWAD Board.

Analysis:
The appellant, a State Public Sector Undertaking, filed a refund claim of &8377; 15,89,304/- for excess excise duty paid on PCC pipes supplied to TWAD Board. The claim was rejected by the adjudicating authority and Commissioner (Appeals) citing limitation and unjust enrichment. The appellant argued that the claim period was within time limits and unjust enrichment did not apply as TWAD Board did not pay any excess duty. The Tribunal noted that the claim for the period March 98 to April 98 and part of May 98 was time-barred, but the claim for May 98 to August 98 was within the limitation period as per Section 11B of the Central Excise Act.

On the merits, it was observed that the appellant cleared goods based on the previous year's rate contract pending receipt of the revised rate contract for the year 1998-99 from TWAD Board. The Tribunal found that the appellant could not opt for provisional assessment as the rates were fixed by TWAD Board annually, and there was no variation in prices. Referring to a similar Tribunal decision and a Supreme Court judgment, the Tribunal held that the appellant was eligible for a refund for the period 28.5.98 to 31.8.98, as they had paid excise duty at a higher price based on the previous year's rate.

The Tribunal ruled that the unjust enrichment clause did not apply in this case as TWAD Board did not pay any excess excise duty to the appellant, and the appellant had collected only the contract price. Consequently, the Tribunal allowed the appeal in part, holding the refund claim time-barred for a specific period but allowing the refund for the period 28.5.98 to 31.8.98 based on the Apex Court's decision.