1993 (4) TMI 177 - AT - Central Excise

Summary

Issues Involved:
1. Whether the incidence of duty was passed on to any other person.
2. Whether the refund of Rs. 4,01,620/- should be allowed through credit in RG 23A Part II Account.

Summary:

Issue 1: Incidence of Duty Passed On
The Respondents, engaged in manufacturing A.D.V. tyres, paid duty under protest and subsequently filed for refunds. The Assistant Collector, upon re-examination, concluded that the incidence of duty had not been passed on to customers, allowing partial refunds. The Revenue appealed, arguing that the burden of proof u/s 11C of the Central Excises and Salt Act, 1944, was not met by the Respondents. The Tribunal upheld the concurrent findings of the Assistant Collector and Collector (Appeals) that the Respondents did not pass on the duty incidence, citing consistent pricing and market conditions as evidence. The Tribunal emphasized that rightful claimants should not be denied refunds based on conjectures and surmises, referencing the case of Dollar Co., Madras v. Govt. of India, 1986 (24) E.L.T. 245.

Issue 2: Refund Through Credit in RG 23A Part II Account
The Revenue contended that since the A.D.V. tyres became exempt during the relevant period, the Respondents were ineligible for Modvat credit on inputs used in their manufacture. The Tribunal agreed, noting that the Respondents had already reversed part of the credit and were willing to reverse the remaining amount. The Tribunal ordered the reversal of the Modvat credit amounting to Rs. 4,01,620/- u/r 57C of the Central Excises and Salt Act, 1944.

Conclusion:
Appeal No. E/5088/91-C was rejected, and Appeal No. E/5094/91-C was partly allowed regarding the refund through credit in RG 23A Part II Account, directing the Respondents to reverse the remaining Modvat credit. Both appeals were disposed of with consequential relief to the Respondents.