2016 (12) TMI 387 - AT - Central Excise

Rejection of refund claim - pre-deposit - unjust enrichment - Held that - I find that the appellant had given evidence that the same is not hit by unjust enrichment by producing a photograph of Ledger Account maintained in their system, which indicated that the appellant had not expressed out the amount deposited on the direction of the Tribunal. I also find that the appellant had produced a Chartered Accountant s certificate dated 3.5.2011 which also indicates that the appellant had maintained that this amount is receivable from the Excise Department and not expressed out. I find that the first appellate authority has overlooked to these crucial evidences, which supported the claim of the appellant that there is no unjust enrichment. In my considered view, the appeal of the appellant is on strong footing and needs to be allowed as he is able to demonstrate that they have not collected the amount from their customers and indicated the same in Balance-sheet as receivable from the Excise Department. Refund allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim rejection of ?1 lakh based on unjust enrichment.

Analysis:
The appeal was against the rejection of a refund claim of ?1 lakh by the Commissioner of Central Excise (Appeals), Mumbai-II. The appellant had initially deposited this amount as per a pre-deposit order by the Bench for hearing and disposing off the appeals. The adjudicating authority sanctioned the refund, but the revenue filed an appeal claiming unjust enrichment. The first appellate authority set aside the refund order based on the unjust enrichment principle.

Upon review, the appellant presented evidence to support that unjust enrichment did not apply. They provided a photograph of a Ledger Account showing the amount was not expressed out as directed by the Tribunal. Additionally, a Chartered Accountant's certificate confirmed that the amount was receivable from the Excise Department and not collected. The Tribunal noted that crucial evidence supporting the appellant's claim was overlooked by the first appellate authority. It was established that the appellant had not collected the amount from customers and reflected it as receivable from the Excise Department in their Balance-sheet.

Considering the evidence presented, the Tribunal found the appeal to be strong and in favor of the appellant. The Tribunal concluded that the appellant had demonstrated that there was no unjust enrichment, and therefore, set aside the previous order rejecting the refund claim. The appeal was allowed, and consequential relief, if any, was granted.

In summary, the Tribunal ruled in favor of the appellant, allowing the appeal and overturning the decision to reject the refund claim based on unjust enrichment. The evidence provided by the appellant, including the Ledger Account and the Chartered Accountant's certificate, supported the claim that the amount was not collected from customers and was rightfully refundable as receivable from the Excise Department.