2017 (9) TMI 929 - AT - Central Excise

Refund claim - denial on the ground of unjust enrichment - Held that - The invoice clearly shows that appellant has paid duty at the rate of 12%. Although the appellant is selling goods on MRP basis but duty payable has been shown by the appellant at the rate of 12% - duty has been paid by the appellant voluntarily on the understanding that they are required to pay duty at the rate of 12%. Further, appellant has failed to produce any evidence on record that buyers have not availed Cenvat Credit on duty shown in the invoice. In that circumstances appellant has failed to pass the bar of unjust enrichment - appeal dismissed - decided against appellant.

Summary

Issues:
Refund claim rejection based on unjust enrichment.

Analysis:
The appellant, a cement manufacturer, filed an appeal against the rejection of their refund claim due to unjust enrichment. The appellant paid duty at 12% even after a reduction to 8%, leading to an excess duty payment. The appellant argued they did not pass the duty incidence to buyers, supported by a certificate from a Chartered Accountant. They contended that selling goods at MRP meant duty rates did not affect the price. However, the respondent pointed out that the invoices clearly stated duty paid at 12%, indicating passing on the duty to buyers. The Tribunal noted the appellant's practice of selling at MRP but found that duty was separately shown in invoices, indicating passing on the duty to buyers.

The Tribunal referenced a case where duty was paid in protest for SSI exemption, distinguishing it from the current case where duty was voluntarily paid at 12%. The appellant failed to prove buyers did not avail Cenvat Credit on the duty shown in invoices, crucial for passing the unjust enrichment test. Consequently, the Tribunal upheld the rejection of the refund claim, as the appellant did not meet the unjust enrichment criteria. The appeal was dismissed, affirming the original order.