2005 (9) TMI 2 - AT - Central Excise

Refund Unjust enrichment - higher duty shown in invoice and paid, but not collected from buyer as per evidence on record - bar of unjust enrichment not applicable

Summary

Issues:
Refund claim rejection based on unjust enrichment.

Analysis:
The appellant, engaged in manufacturing processed man-made fabric, filed a refund claim following an increase in deemed credit under Notification No. 25/2001-CE. Despite the duty reduction from 8.8% to 8%, the refund was denied citing unjust enrichment as the appellant allegedly collected duty from customers. The appellant argued that customers objected to the excess charge, paid only 8%, and issued credit notes to rectify the error. The Tribunal had previously allowed a refund in a similar case where duty was not collected. The appellant presented evidence of customer objections and partial payments, indicating duty was not passed on. The Tribunal's decision in another appeal supported this stance, emphasizing that unjust enrichment did not apply. Considering the evidence and precedents, the rejection of the refund claim was deemed unsustainable, leading to the appeal being allowed on the basis that duty was not collected, thus negating unjust enrichment principles.