2019 (2) TMI 1169 - AT - Central Excise

Refund claim - certain discounts allowed on the goods on clearance from the depot - contention of the department was that the appellant did not provide the details of the discounts passed on and that they could not produce evidence/documents to indicate the quantity of discounts passed on - unjust enrichment - Held that - On perusal of the invoices, it is seen that the duty has been paid at the time of clearance from the factory. The discounts are pre-notified to their customers and have been passed on as evidenced from the invoice and accounts. The certificates given by the Chartered Accountant, who also indicate the discounts have been passed on and wherever duty was liable to be refunded, the same has been shown as receivable in the books of accounts - the appellants have adhered to the requirements of provisions related to valuation of goods under Central Excise Act, 1944 and made there under. Refund cannot be denied on this ground - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claims based on extended discounts without detailed evidence.

Analysis:
The appeals involved M/s. Savita Oil Technologies Ltd. filing refund claims citing discounts extended on goods clearance from the depot. The department contended that the appellant failed to provide discount details and evidence to prove duty incidence not passed on. The appellant argued that providing a breakup of discounts was unnecessary as long as the discount structure was known to the buyer. They cited various cases to support their stance. Additionally, they highlighted that duty was paid at clearance from the factory, eliminating the need to track subsequent sales prices. The appellant also argued that once amounts were shown as receivable in their accounts, principles of unjust enrichment did not apply to refund claims. They referenced multiple decisions supporting their position.

For Appeal No. E/841/2011, the Tribunal found that the issue was no longer resintegra as it had been settled in the appellant's favor in previous cases and accepted by the department for a later period. The Tribunal reviewed submitted documents, including invoices, commercial invoices, credit notes, and ledger accounts, and found that discounts were pre-notified to customers and passed on as evidenced by invoices and accounts. The Chartered Accountant's certificates confirmed the discounts were passed on, and duty refund liabilities were reflected in the books. The Tribunal concluded that the appellants complied with Central Excise Act provisions and upheld the appeals on merit, allowing Appeal No. E/841/2011 in full and Appeal No. E/127/2011 partially.

In conclusion, the Tribunal ruled in favor of M/s. Savita Oil Technologies Ltd., emphasizing compliance with discount notification and passing on requirements, as well as proper documentation and accounting practices. The judgment highlighted the importance of adhering to legal provisions and established case law in refund claim disputes, ultimately granting relief to the appellant based on the presented evidence and legal arguments.