2018 (10) TMI 821 - AT - Central Excise

Refund of excess duty paid - dispute regarding classification was involved - rejection of refund on the ground of unjust enrichment - Held that - The appellant was directed to establish its eligibility and also the fact that they have not passed on the element of duty to the consumer, and as submitted by the learned Advocate, the said order has become final. It is deemed proper to give one more opportunity, in the interest of justice, to the appellant to go before the learned Commissioner (Appeals), comply with the directions of this Bench by producing all such necessary documents to prove its eligibility - appeal allowed by way of remand.

Summary

Issues:
- Denial of refund of excess duty paid on 'Slides and Inner Frames' for self-consumption
- Rejection of refund by the adjudicating authority and partial relief granted by the Commissioner (Appeals)
- Remand by CESTAT for fresh consideration
- Further denial of refund by the Commissioner (Appeals) leading to the current appeal

Analysis:

1. The appellant contested the denial of refund amounting to ?11,20,539 for excess duty paid on 'Slides and Inner Frames' for self-consumption during the manufacturing of cigarettes. The dispute arose due to a classification issue, which was resolved by the Supreme Court in an earlier order upholding CEGAT's decision. The appellant sought a refund for the duty paid between February 1986 to March 1994. The adjudicating authority initially rejected the refund claim, leading to an appeal by the assessee. The Commissioner (Appeals) partially granted relief, refunding ?59,54,749. Subsequently, CESTAT remanded the matter back to the Commissioner (Appeals) for fresh consideration.

2. During the appeal hearing, the appellant's advocate argued against the partial denial of refund, citing the Range Officer's report from the previous litigation round. The advocate contended that all necessary documents were provided to support the refund claim, as acknowledged by the Range Officer's recommendation. On the other hand, the Revenue's representative argued that the refund granted was based on the documents submitted by the appellant. The Commissioner (Appeals) had requested additional documents, which were eventually provided, leading to a further refund of ?17,02,145.

3. The Revenue's representative emphasized that the appellant needed to establish eligibility for the refund, as directed in the previous order by the Bench. The representative highlighted that the appellant had not proven whether the duty payment preceded the refund claim. The appellant expressed willingness to furnish additional documents to support the refund claim for the remaining amount.

4. The Bench considered the arguments presented, reviewed the documents, and noted the directions issued in the previous order. The Bench acknowledged that the appellant was directed to establish eligibility and prevent unjust enrichment. Given the finality of the previous order, the Bench decided to grant the appellant another opportunity to comply with the directions and provide necessary documents to prove eligibility.

5. Consequently, the Bench allowed the appeal by remanding the case back to the Commissioner (Appeals) for further proceedings. The appellant was instructed to cooperate with the Commissioner (Appeals) without unnecessary adjournments, aiming for a resolution within six months from the date of the order.

This detailed analysis outlines the legal journey of the case, highlighting the key arguments, decisions, and directions leading to the remand of the appeal for further consideration.