2008 (9) TMI 299 - AT - Central Excise

Refund of duty paid under compounded levy scheme proof against unjust enrichment - Detailed sheets for each year and order and for each product were produced before Commissioner (Appeals) which stand scrutinized by him and on the basis of which a clear finding that duty does not stand recovered from the customers stand arrived at by him - In the absence of any rebuttal to that finding by the Revenue in their memo of appeal it has to be taken as if the same stands accepted by the Revenue refund is allowable appeal of the revenue stand rejected.

Summary

Issues Involved:
Dispute over refund of excess duty paid and its crediting into consumer welfare fund under Section 12A of the Act. Application of the principle of unjust enrichment in the context of Compounded Levy Scheme. Appeal against the order of adjudicating authority regarding the recovery of duty from customers.

Issue 1: Dispute over refund of excess duty paid and its crediting into consumer welfare fund under Section 12A of the Act
The case involved a dispute where the respondents, engaged in manufacturing non-alloy steel products, were entitled to a refund of excess duty paid due to a revised Annual Production Capacity. The refund claim was sanctioned but credited to the consumer welfare fund as the duty burden passing on to customers was not established. The respondents appealed against this decision.

Issue 2: Application of the principle of unjust enrichment in the context of Compounded Levy Scheme
The Commissioner (Appeals) allowed the appeal of the respondents, stating that the principle of unjust enrichment does not apply in this case, citing a judgment of the Hon'ble Gujarat High Court. The respondents provided detailed evidence showing they had stopped collecting duty from customers and that prices had not increased, which led to the conclusion that the duty element was not recovered from customers. The Revenue contested this finding, referring to a judgment from another case.

Issue 3: Appeal against the order of adjudicating authority regarding the recovery of duty from customers
The Revenue's appeal contested the Commissioner (Appeals) finding that the duty was not recovered from customers. However, the Revenue did not provide any rebuttal to the detailed evidence presented by the respondents, which led to the conclusion that the duty was not passed on to customers. As there was no rebuttal by the Revenue, the Tribunal upheld the Commissioner (Appeals) decision, rejecting the Revenue's appeal.

In conclusion, the Tribunal upheld the Commissioner (Appeals) decision, rejecting the Revenue's appeal as there was no rebuttal to the detailed evidence provided by the respondents showing that the duty was not recovered from customers. The principle of unjust enrichment was found not applicable in this case, and the dispute over the refund of excess duty paid was settled in favor of the respondents.