2021 (8) TMI 84 - AT - Central Excise

Refund of Excise Duty paid - necessary documents provided or not to prove the case, that the refund claim is barred by time limitation - sufficient opportunity of hearing not provided to the appellant - violation of principles of natural justice - HELD THAT - The original authority has rejected the refund observing that the appellant has not produced necessary documents to process the refund. It is stated in the said order that the appellant has not submitted documents to establish that the refund is not hit by unjust enrichment. Countering this observation in the O-I-O, Ld. Consultant has argued that the appellant had filed all the necessary documents including the GRN before the original authority; that the refund was rejected by the original authority without issuing a show cause notice or granting an opportunity of personal hearing. In para-8 of the impugned order, the Commissioner (Appeals) has correctly taken note of all these facts and circumstances of the case. The matter has been thus remanded to the original authority for reprocessing the refund claim after granting the appellant sufficient opportunity to produce documents and also for personal hearing - Appeal allowed by way of remand.

Issues:
Refund claim under Section 11B of Central Excise Act, 1944; Rejection of refund claim due to lack of necessary documents; Violation of principles of natural justice; Remand of the matter to original authority; Opportunity of personal hearing; Grounds for appeal before the Tribunal.

Detailed Analysis:
1. Refund Claim under Section 11B of Central Excise Act, 1944:
The appellant filed a refund claim under Section 11B of the Central Excise Act, 1944, initially for a certain amount which was later revised. The claim was related to excise duty paid on parts supplied to M/s. Hyundai Motor India Ltd., which were returned due to changes in car models. The appellant sought a refund of the excise duty paid on the returned parts.

2. Rejection of Refund Claim due to Lack of Necessary Documents:
The original authority rejected the refund claim citing the appellant's failure to provide necessary documents to establish that the refund was not hit by unjust enrichment. This rejection was based on the observation that the appellant did not submit documents supporting their claim, leading to the denial of the refund claim.

3. Violation of Principles of Natural Justice:
The Commissioner (Appeals) noted that no show cause notice was issued to the appellant, and they were not given a sufficient opportunity for a personal hearing. The Commissioner found a violation of the principles of natural justice, specifically the Audi Alterem Partem rule, which requires the opportunity to be heard before any adverse decision.

4. Remand of the Matter to Original Authority:
In response to the violation of natural justice, the Commissioner (Appeals) remanded the matter to the original authority. The remand directed the original authority to reprocess the refund claim after granting the appellant a reasonable opportunity for personal hearing and to produce necessary documents, ensuring compliance with the principles of natural justice.

5. Opportunity of Personal Hearing:
The remand order emphasized the importance of granting the appellant an opportunity for a personal hearing before rejecting their refund claim. The Commissioner (Appeals) highlighted the necessity of allowing the appellant to present their case and submit relevant evidence to support their claim without violating the principles of natural justice.

6. Grounds for Appeal Before the Tribunal:
The appellant, aggrieved by the remand order, approached the Tribunal seeking a review of the decision. However, the Tribunal upheld the order passed by the Commissioner (Appeals), emphasizing that neither the Commissioner nor the Tribunal had the authority to reprocess the refund claim; this task was reserved for the refund sanctioning authority. Consequently, the Tribunal dismissed the appeal, affirming the decision of the Commissioner (Appeals).

In conclusion, the judgment dealt with issues related to refund claims, the necessity of providing necessary documents, adherence to principles of natural justice, remand of the matter to the original authority, and the role of appellate bodies in ensuring procedural fairness in such cases.

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