2004 (5) TMI 218 - AT - Central Excise

Refund claim - payment of duty - time-barred - Limitation - Protest - Unjust enrichment - HELD THAT -The Supreme Court in the case of Metal Forgings v. Union of India 2002 (11) TMI 90 - SUPREME COURT has held that to establish that clearances were made on a provisional basis, there should be first of all an order under Rule 9B of the Rules and then material to show that the goods were cleared on the basis of such provisional basis and payment of duty was also made on the basis of said provisional classification. Accordingly, the assessment can not be deemed to be provisional merely because the contract entered into between the assessee and their customers contain prices variation clause. Similar views has been held by the Appellate Tribunal in the case of M/s. Rajasthan Cylinders and Container Ltd. v. CCE, Jaipur, Final Order 2003 (10) TMI 190 - CESTAT, NEW DELHI relied upon by the learned Senior Departmental Representative. As the refund claim was initially filed on 31-1-2001, the refund claim for the period July, 1999 to 31-1-2000 was beyond the period of one year stipulated in Section 11B of the Central Excise Act. Thus, we do not find any merit in the Appeal filed by M/s. Universal Cylinders Ltd. and reject the same. Applicability of bar of unjust enrichment , we observe that undisputed fact is that the contract entered into between the assessee and their customers contain the price variation clause. When the customers refused the price of the cylinder with effect from July, 1999, they had deducted the difference amount from payment already made by them to the assessee. In view of these facts, it cannot be claimed by the Revenue that the incidence of duty has been borne by the assessee. As their customers had not made the entire payment to them on account of revision of the price downward with effect from July 1999, the decisions relied upon by the learned Senior Departmental Representative are not applicable as in those cases, the credit notes were issued subsequently by the assessee to their customers. We, therefore, find no reason to interfere with the finding of Commissioner (Appeals) on this aspect also and accordingly reject the Appeal filed by the Revenue.

Summary

Issues involved: Appeal against Order-in-Appeal No. 628/2003 regarding refund claim for Central Excise duty for the period February 2000 to October 2000 and rejection of refund claim for the period July 1999 to January 2000 as time-barred.

Refund Claim and Time Barred Issue: The appellant, a manufacturer of metal containers, filed a refund claim due to downward price revision by customers resulting in excess duty payment. The Deputy Commissioner rejected the claim citing unjust enrichment and time-barred filing. The Commissioner (Appeals) allowed refund for a limited period but rejected the rest as time-barred. The appellant argued for provisional assessment under Rule 9B, citing Asiatic Oxygen case, to extend the refund claim period. However, the Tribunal found the claim time-barred as no provisional assessment request was made, following Metal Forgings case precedent.

Unjust Enrichment Issue: The Departmental Representative argued against the refund claim, citing Kakatiya Cements case and S. Kumar's Ltd. case on unjust enrichment. The Tribunal noted the price variation clause in contracts and customer deductions due to price revision, concluding that the duty burden was not passed to the appellant. The Tribunal upheld the Commissioner (Appeals) decision, rejecting the Revenue's appeal.

In conclusion, the Tribunal dismissed the appeal by the manufacturer, upholding the rejection of the refund claim for the period July 1999 to January 2000 as time-barred and finding no unjust enrichment due to customer deductions post-price revision.