2002 (4) TMI 113 - AT - Central Excise

Summary

Issues involved: Classification dispute, refund claim, passing on of duty incidence, Doctrine of unjust enrichment.

Classification Dispute: The appellants, engaged in manufacturing blended yarn, disputed the classification of the yarn under chapter heading 5506 as per Revenue's claim, contending it should be under chapter heading 5505 of the CETA. Tribunal settled the dispute in favor of the appellants.

Refund Claim: Appellants sought refund of the higher duty amount paid under protest, which the A.C. accepted but ordered to credit to Consumer Welfare Fund, alleging duty incidence passed on to buyers. Appellants presented evidence, including balance sheets and certified documents, to prove they did not pass on the duty incidence.

Passing on of Duty Incidence: Appellants argued they never passed on duty to buyers, referencing judgments stating composite invoices do not prove passing on of duty. The JDR contended that composite price in invoices inferred passing on of duty.

Doctrine of Unjust Enrichment: The Tribunal found from the evidence presented that duty incidence was not passed on to customers, contrary to the Commissioner (Appeals) decision. The Tribunal set aside the impugned order and directed the refund amount to be released to the appellants, as they were entitled to it.

Conclusion: The Tribunal allowed the appeal, emphasizing that the appellants were entitled to the refund as they did not pass on the duty incidence. The decision was based on the evidence provided, including balance sheets and certified documents, disproving the passing on of duty incidence to customers.