2018 (2) TMI 134 - AT - Central Excise

Refund claim - unjust enrichment - whether the provisions of unjust enrichment is applicable in respect of the refunds arising out of finalization of provisional assessments pertaining to period prior to 25.6.1999 even if the assessments are finalized after 25.6.1999 (when Rule 9B of the Central Excise Rules, 1944 was amended vide notification No. 45/99-CE(NT) dt. 25.6.1999)? Held that - where the provisional assessment is pertaining to the period prior to the amendment of Rule 9B vide N/N. 45/99-CE(NT) dt. 25.6.1999 and finalization of assessment completed after the said date refund arising out of such finalization of assessment will not hit by unjust enrichment as the provision of unjust enrichment shall not be applicable - the provision of unjust enrichment is not applicable - refund allowed - appeal allowed - decided in favor of appellant.

Summary

Issues involved: Whether the provisions of unjust enrichment are applicable in refunds arising from finalization of provisional assessments prior to 25.6.1999, even if assessments are finalized after this date.

Analysis:

1. Appellant's Argument: The appellant argued that unjust enrichment provisions were not applicable to refund claims before 25.6.1999. They cited various judgments to support their claim, emphasizing that the amended Rule 9B from 25.6.1999 should not retroactively apply to assessments before this date. The appellant highlighted cases like Commissioner of Central Excise, Chennai Vs. T.V.S. Suzuki Ltd. and Commissioner of Customs Vs. Hindalco Industries Ltd. to strengthen their argument.

2. Revenue's Argument: The Revenue reiterated the findings of the lower authority and relied on judgments such as Sahakari Khand Udyog Mandal Ltd. Vs. CCe and Sanat Products Ltd. Vs. CCE to support their stance.

3. Judgment Analysis: The Tribunal examined the issue and referred to several key judgments to reach a decision. They cited the Mafatlal Industries Ltd. Vs. Union of India case, where it was clarified that refunds from finalization of provisional assessments under Rule 9B are not governed by Section 11A or 11B. The Tribunal also referenced the T.V.S. Suzuki Ltd. case, which emphasized that subsequent amendments should not impact refund claims. Furthermore, the Tribunal highlighted the Allied Photographics India Ltd. case, stating that Section 11B and Rule 9B operate in different spheres. The judgment also referred to the Hindalco Industries Ltd. case, where the retrospective nature of amendments was discussed. The Larger Bench of the CESTAT in the Panasonic Battery India Co. Ltd. case reiterated that unjust enrichment provisions apply only to assessments after 25.6.1999.

4. Conclusion: Based on the legal precedents and analysis, the Tribunal concluded that unjust enrichment provisions do not apply to refund claims from assessments before 25.6.1999. They emphasized that the appellant was entitled to a refund without proving unjust enrichment, as Section 11B was not applicable in this case. The Tribunal set aside the impugned order and allowed the appeal in favor of the appellant.

This comprehensive analysis of the judgment showcases the legal reasoning behind the decision and the application of relevant legal principles to resolve the issues involved.