2024 (8) TMI 779 - AT - Central Excise

Refund of erroneously paid duty - refund claimed on the basis of affidavit and certificate as allowed by Ld.Commissioner(Appeals) was inappropriate and not in accordance with law - HELD THAT - It is noted from records that Revenue has nowhere disputed the fact of discharge of duty by the appellant on the strength of the revised invoice under which the goods were cleared. It is also borne out from records that the respondents had inadvertently discharged excise duty in the month of April 2012 having mistakenly issued invoice No.200000000000097 dated 12.04.2012 for clearance of the entire consignment pertaining to purchase order No.2900001399/109. As it has not been disputed that the respondent was not in a position to supply the entire consignment vide invoice dated 12.04.2012, a fresh invoice for part quantity was issued on 13.04.2012 and goods supplied with respect to the said purchase order. In the absence of any contrary claim/evidence to the effect of the respondent‟s version, the documentation were sufficient enough to establish the bonafides and uphold the refund claim filed by the respondent, duly establishing the claims of the respondent. This Tribunal in the case of M/S. PRICOL UNIT - I VERSUS COMMISSIONER OF GST CE, COIMBATORE 2021 (6) TMI 979 - CESTAT CHENNAI had held the said procedure to be procedural and while allowing refund of duty in the said case, it had categorically asserted that the department was not empowered to retain duty which is not payable under the provisions of law. Once an invoice is cancelled, no duty can be demanded thereon and the onus thereafter, lies on the department to establish that goods were actually moved under the cover of the said invoice and invoice subsequently cancelled leading to loss of duty. There is not a shred of evidence to establish such a case in the present matter. There are no infirmity in the order of the Ld.Commissioner(Appeals) - appeal filed by the department is dismissed.

Summary

Issues Involved:
1. Double payment of duty.
2. Non-intimation of invoice cancellation to jurisdictional authorities.
3. Basis of refund claim on affidavits and certificates.
4. Remarks indicating sales return.

Detailed Analysis:

1. Double Payment of Duty:
The respondent, a division of Tata Steel Ltd., inadvertently raised an invoice (No.200000000000097 dated 12.04.2012) indicating full purchase order value and corresponding tax. Upon realizing the mistake, the invoice was canceled the same day, and a new invoice (No.200000000000112 dated 13.04.2012) was issued with the correct values. The respondent discharged duty twice and filed a refund claim for the erroneously paid duty in October 2012. The adjudicating authority initially rejected the refund claim, but the Commissioner (Appeals) allowed it, noting that the goods under the original invoice were not cleared, and duty was paid from the Cenvat Credit account.

2. Non-intimation of Invoice Cancellation:
The department argued that the respondent failed to inform the jurisdictional Range Officer or the Assistant Commissioner about the invoice cancellation. However, the Commissioner (Appeals) held that non-intimation was not a fatal error that warranted rejection of the refund. The Tribunal supported this view, emphasizing that procedural lapses should not deny substantive benefits, especially when duty was paid twice.

3. Basis of Refund Claim on Affidavits and Certificates:
The department contended that the refund was based solely on affidavits and certificates, which is not provided for under Excise law. The Commissioner (Appeals) and the Tribunal found the documentation sufficient to establish the respondent's claim. The affidavits from the project manager and transporter, along with a certificate from Tata Steel Ltd. and gate register entries, confirmed that no goods were dispatched under the canceled invoice.

4. Remarks Indicating Sales Return:
The department noted that the "sales return" remark on the canceled invoice suggested the goods were cleared and returned. The respondent clarified that the goods never left the premises, supported by gate register entries and other documents. The Tribunal upheld this explanation, noting that there was no evidence to contradict the respondent's claims.

Conclusion:
The Tribunal dismissed the department's appeals, finding no infirmity in the Commissioner (Appeals)'s order. The Tribunal emphasized the principle that substantive benefits should not be denied due to procedural irregularities, especially when it is established that duty was paid without actual clearance of goods. The Tribunal also highlighted that the onus was on the department to prove that goods were cleared under the canceled invoice, which was not done in this case. The decision aligns with previous rulings that procedural lapses should not result in the denial of rightful refunds.