2018 (7) TMI 1521 - AT - Central Excise

Refund of duty element payable on the trade discount given to their dealers - whether the assessee is entitled to refund of duty in respect of the trade discounts which he has given subsequent to the clearance of the goods? - Held that - This refund was rejected by the Assistant Commissioner on merits (not on the grounds of unjust enrichment itself) - As these cases involve the question of valuation, they should appropriately go to the Division Bench, although amounts involved are not large. The Registry is directed to place these before the Division Bench in due course.

Summary

Issues involved:
Delay in filing appeal, valuation of goods for duty calculation, entitlement to refund for trade discounts given post-clearance.

Analysis:
1. Delay in filing appeal:
The Department filed an application seeking condonation of a 784-day delay in filing the appeal against the Order-in-Appeal due to an error in filing only one appeal instead of two separate appeals. The delay was condoned by the Tribunal considering the substantive case and directed that two matters against the same appellant be considered together.

2. Valuation of goods for duty calculation:
The appellant, a manufacturer of paper and paperboard, cleared goods both from the factory gate and depots, adopting the same price for clearance from both locations. The dispute arose when the appellant claimed refunds on duty for trade discounts given post-clearance from depots. The lower authority rejected the refund claims, stating that assessments were final and not provisional for depot clearances, hence not entitled to refunds for discounts given post-assessment finalization.

3. Entitlement to refund for trade discounts given post-clearance:
The Department appealed the Order-in-Appeal, arguing that the appellant failed to declare the price of goods meant for depots at the factory gate for appropriate duty payment as per Sec. 4. They contended that since assessments were final, there was no basis for claiming a refund. The Department cited a judgment overruling a similar case by the High Court of Madras. The Tribunal found this to be a case of refund related to valuation under Sec. 4, directing the matter to the Division Bench for consideration due to the valuation dispute.

In conclusion, the Tribunal allowed the application for condonation of delay, ordered the appeals to be placed before the Division Bench for valuation-related issues, and highlighted the need for further assessment on the entitlement to a refund for trade discounts given post-clearance.