2018 (2) TMI 1008 - AT - Central Excise

Recovery of erroneous refund - Held that - Though the appellants have filed appeal before the Hon ble High Court but no stay has been granted by the Hon ble High Court - Therefore, in the present case, which is related to recovery proceedings of the erroneous refund, the matter cannot be kept in abeyance - appeal dismissed.

Summary

Issues:
Appeal against erroneous refund demand confirmation by Commissioner, challenge before Tribunal, pending appeal before High Court, protective show-cause notice leading to recovery order.

Analysis:
The case involves an appeal against the confirmation of a demand for an erroneous refund of ?17,27,148 by the Commissioner. The appellant's refund was initially rejected by the sanctioning authority, leading to a successful appeal before the Commissioner (Appeals). However, the revenue challenged this decision before the Tribunal, which allowed the appeal, prompting the appellant to file an appeal before the High Court, which is still pending. Meanwhile, following the Commissioner (Appeals)'s order, the sanctioning authority sanctioned the refund but also issued a protective show-cause notice, resulting in an order for recovery of the erroneous refund, which is the subject of the present appeal.

The appellant's counsel requested to keep the matter in abeyance due to the pending proceedings before the High Court. On the other hand, the revenue's representative argued that in the absence of a stay from the High Court, the tribunal's order should prevail, leading to the dismissal of the appeal. The Tribunal, after considering both submissions, noted that the rejection of the refund claim had attained finality as per the Tribunal's previous order. The Tribunal cited specific legal precedents to support its decision, emphasizing the doctrine of unjust enrichment and the passing of the incidence of duty to customers. Despite the pending appeal before the High Court, since no stay had been granted, the Tribunal held that the matter related to the recovery of the erroneous refund could not be kept in abeyance. Consequently, the appeal was dismissed, and the impugned order was upheld.

In conclusion, the Tribunal's decision was based on the finality of the rejection of the refund claim, the absence of a stay from the High Court, and the application of legal principles regarding unjust enrichment and the passing of duty incidence. The dismissal of the appeal affirmed the order for recovery of the erroneous refund, highlighting the importance of legal procedures and precedents in such cases.