2015 (10) TMI 1342 - AT - Central Excise

Refund claim - Unjust enrichment - Held that - First appellate authority has not disputed or controverted the certificate of C.A. produced by the appellant to indicate that the amount for which claim of refund is filed was not debited to Profit and Loss account as expenses by not addressing on such a vital document produced by the appellant. - In the absence of any contradiction, the question of doctrine of unjust enrichment will not come in a way in this case. Reliance placed by learned AR in the case of Union of India v. Jain Spinners Ltd. - 1992 (9) TMI 88 - SUPREME COURT OF INDIA and United Spirits Ltd. v. C.C. (Import) - 2009 (6) TMI 23 - BOMBAY HIGH COURT may not carry the case of the Revenue any further in the facts and circumstances of the case law was decided. It is to be recorded that the Revenue is bound by its own Board s Circular which states that no refund claim needs to be filed for reclaiming an amount deposited on direction of appellate authority. Revenue is supposed to retain the amounts so deposited, an appeal being decided in assessee s favour; suo motu. - In the facts and circumstances of this case where the appellant has deposited an amount for hearing and disposing of the appeal on merits and having succeeded in appeal and also having evidenced that the amount has not been debited to Profit and Loss account as expenses, the question of holding back the amount by the Revenue does not arise.- Decided in favour of assessee.

Summary

Issues involved:
1. Refund claim of an amount deposited by the appellant.
2. Application of the doctrine of unjust enrichment.
3. Validity of the Chartered Accountant's certificate.
4. Interpretation of relevant legal precedents.
5. Compliance with Revenue's Circular on refund claims.

Analysis:
The appeal before the Appellate Tribunal CESTAT MUMBAI revolved around the refund claim of an amount deposited by the appellant as per the Tribunal's direction. The appellant had succeeded in the appeal, prompting a refund claim, which was initially allowed by the adjudicating authority but later set aside by the first appellate authority citing the doctrine of unjust enrichment. The key contention was whether the appellant was eligible for the refund, considering the doctrine of unjust enrichment, which requires that the refund should not enrich the appellant unjustly.

During the proceedings, the appellant presented a Chartered Accountant's certificate indicating that the amount in question had not been debited to the Profit and Loss account as expenses, suggesting that the amount was still outstanding as receivable from the department. The appellant argued that this certificate was crucial evidence that the first appellate authority failed to address adequately in its decision. The Tribunal noted that the certificate remained uncontested by the department and dated prior to the appeal, undermining the application of the doctrine of unjust enrichment.

In its analysis, the Tribunal emphasized that the absence of contradiction regarding the certificate and the Revenue's obligation, as per its Circular, to retain deposited amounts in case of appeal success favored the appellant's position. The Tribunal referenced legal precedents to support its decision, highlighting that the Revenue was bound by its own Circular not to require a refund claim for amounts deposited on appellate authority's direction. Ultimately, the Tribunal concluded that the impugned order was flawed and set it aside, allowing the appeal with consequential relief for the appellant.