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2016 (12) TMI 1115 - AT - Central ExciseRefund - time bar - unjust enrichment - Cash discount - Held that -The appellant had submitted in the grounds of appeal that the cash discount was not collected from their customers and cash discount was not part of the assessable value and therefore, it was not part of cum-duty price and therefore Excise Duty was not collected on that component and as a result Excise Duty was not collected from their customers and duty incidence was not passed on - We further find that proviso to Sub rule 5 of Rule 9B of Central Excise Rules, 1944 came into operation w.e.f. 25.06.1999, Section 11B for unjust enrichment was not applicable for refund arising out of provisional assessment - The Original Authority shall also take into consideration the interest to be paid on the said amount from the date on which provision for paying interest on delayed refund came into operation on the statute of Central Excise Act, 1944 - appeal allowed - decided in favor of appellant-assessee.
Issues:
1. Claim of refund time-barred and hit by unjust enrichment. 2. Interpretation of Rule 9B of Central Excise Rules, 1944. 3. Applicability of Section 11B for unjust enrichment. 4. Entitlement to interest on the refund amount. Analysis: 1. The appeal dealt with a claim of refund amounting to ?14,10,371 filed by the appellant, which was rejected as time-barred and hit by unjust enrichment through Order-in-Original No.33/2006(R) dated 20.09.2006. The assessments were kept pending from January, 1993 to April, 1993, and were finalized on 17.04.1997. The appellant filed four refund claims for the period in question, which were rejected. The Commissioner (Appeals) upheld the rejection, citing the claim to be time-barred and invoking the bar of unjust enrichment based on the judgment in Mafatlal Industries Ltd Vs. Union of India. The appellant then appealed to the Tribunal challenging the rejection. 2. The grounds of appeal raised questions regarding the finalization of price and provisional assessment, claiming that the refund should be allowed without a formal claim if arising from finalization of provisional assessment before 25.06.1999. The appellant argued that the duty incidence was not passed on to customers due to cash discounts, and therefore, they were entitled to the refund. The Tribunal considered the arguments and found that the refund claims were filed before the finalization of provisional assessment, and the proviso to Rule 9B(5) came into operation after the relevant period, making Section 11B for unjust enrichment inapplicable. Consequently, the Tribunal held that the appellant was entitled to the refund amount of ?14,10,371 based on the refund claim filed on 26.07.1993. 3. During the hearing, the Revenue submitted a report confirming the facts related to the refund claims and finalization of provisional assessment. The Tribunal considered the report and reiterated that the refund claims were filed before the finalization of provisional assessment, meeting the statutory requirements. Relying on various Supreme Court judgments and case laws, the Tribunal concluded that the appellant was entitled to the refund amount, directing the Original Authority to pay the refund within sixty days along with applicable interest from the date the provision for interest on delayed refund came into operation under the Central Excise Act, 1944. 4. In conclusion, the Tribunal allowed the appeal, emphasizing the statutory provisions, timeline of events, and legal precedents to establish the appellant's entitlement to the refund amount, setting aside the previous rejection on grounds of time-bar and unjust enrichment. The detailed analysis of Rule 9B, Section 11B, and relevant case laws formed the basis for the Tribunal's decision in favor of the appellant.
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