2018 (1) TMI 526 - AT - Central Excise

Refund claim of amount paid under protest - unjust enrichment - Held that - It has to be seen as to whether the deposits were made by the appellant subsequent to the sale invoices and at the instance of their jurisdictional central excise authorities - There is also no finding in respect of bar of unjust enrichment being not applicable in respect of refund of amounts in terms of rule 6 of CCR - the matter remanded to original adjudicating authority for fresh consideration - appeal allowed by way of remand.

Summary

Issues:
1. Refund of duty paid by the appellant rejected on the ground of unjust enrichment.
2. Pleas raised by the appellant in their memo of appeal regarding unjust enrichment principles and applicability to the refund of pre-deposits.
3. Lack of specific findings by lower authorities on various issues raised by the appellant.

Analysis:

Issue 1: Refund of duty rejected on unjust enrichment grounds
The appellants, engaged in the manufacture of sugar and molasses, paid amounts under protest on the bagasse sold during specific periods. Subsequently, they received demand notices for further amounts, which were upheld by lower authorities. The Commissioner(Appeals) and lower authorities rejected the refund claims citing unjust enrichment. However, the Tribunal set aside these orders and allowed the appeals with consequential relief.

Issue 2: Appellant's pleas and arguments
The appellant raised several pleas in their memo of appeal. They contended that the lower authorities did not provide specific findings on the unjust enrichment principles and the applicability of such principles to the refund of pre-deposits. The appellant produced a Chartered Engineer's certificate stating that the amount was not recovered from customers, emphasizing that the unjust enrichment principle should not apply. They also cited precedents and decisions to support their arguments against the bar of unjust enrichment.

Issue 3: Lack of specific findings by lower authorities
The Member(Judicial) noted that the lower authorities failed to address the various issues raised by the appellant adequately. Specifically, there were no findings on whether the deposits were made post-sale invoices and at the behest of central excise authorities. Additionally, there was a lack of clarity on the applicability of the bar of unjust enrichment to refund amounts under Rule 6 of Cenvat Credit Rules. Consequently, the Member(Judicial) set aside the impugned order and remanded the matter to the original adjudicating authority for fresh consideration, ensuring the appellant's opportunity to present their case before the Commissioner.

In conclusion, the judgment highlighted the importance of addressing all relevant issues raised by the appellant, providing specific findings on unjust enrichment principles, and ensuring a fair consideration of refund claims in line with applicable rules and precedents.