2016 (7) TMI 893 - AT - Central Excise

Refund claim of excess duty paid - unjust enrichment - manufacture of Cement and Clinker - By Notification No. 12/2012.CE dated 17-03-2012, the rate of duty for cement other than those cleared in packaged form (ie. loose cement was enhanced from 10% to 12%. - Later, a corrigendum to Notification No. 12/2012 was issued as F. No 334/1/2012-TRU dated 22-03-2012 by which proviso was inserted to Sl.No.52. Thus, the rate of duty payable on Sale to Industrial & Institutional Consumers became 12%, same as that of loose cement and not 12% Adv. ₹ 120/- per Mt. Specific rate. - Pursuant to the Corrigendum, appellant filed refund claim for the excess duty paid. Held that - after issuance of corrigendum the excess duty, paid lacks the colour of duty and is merely a deposit - the excess paid is only an amount deposited by appellant, not being duty is not hit by doctrine of unjust enrichment. - appellant is eligible for refund. The appeal is allowed with consequential reliefs, if any. - Decided in favor of assessee.

Summary

Issues:
Refund claim rejection based on unjust enrichment doctrine for excess duty paid on cement cleared in packaged form without RSP affixed.

Analysis:
The appellant, a cement manufacturer, cleared products in different forms, including packaged cement without RSP for industrial consumers. The issue concerned the duty rate applicable to such cement. Initially, the duty rate was the same for loose and packaged cement. Subsequently, the duty on loose cement was increased without a corresponding change for packaged cement for a brief period. The appellant claimed a refund for the excess duty paid during this period, arguing it was a deposit and not duty. The authorities rejected the claim citing higher duty mentioned in invoices and lack of evidence of passing on the duty.

The appellant contended that the duty was not passed on as the price to customers remained constant, and duty was shown in invoices due to legal requirements. The AR argued that invoicing higher duty implied passing on the duty unless proven otherwise. The appellant provided a detailed comparison chart showing excess duty paid on specific invoices, indicating the price consistency and lack of duty pass-through. The appellant also referenced a judgment where a similar refund claim was rejected due to duty mention in invoices.

The Tribunal considered the nature of the excess duty post-corrigendum, concluding it was a deposit, not duty, and thus not subject to unjust enrichment. Citing legal precedents and the corrective nature of corrigendum, the Tribunal held that the excess amount lacked the character of duty and was eligible for a refund. The Tribunal differentiated between duty and deposit, emphasizing that the excess paid was not hit by the unjust enrichment doctrine. The decision favored the appellant, allowing the refund claim and any consequential reliefs.

This detailed analysis of the judgment showcases the complex legal arguments, interpretations of duty pass-through, and the application of the unjust enrichment doctrine in the context of excess duty payments on cement cleared for industrial consumers without RSP affixed.