1998 (5) TMI 122 - AT - Central Excise

Summary

Issues:
1. Refund claim involving unjust enrichment under Section 11D of Central Excise Act, 1944.
2. Classification of Viscose and NC Synthetic Waste Blended Yarn.

Analysis:
1. Refund Claim and Unjust Enrichment:
The appeal contested an Order-in-Appeal upholding an order-in-original that allowed a refund claim but credited it to the Consumer Fund due to unjust enrichment under Section 11D of the Central Excise Act, 1944. The appellants sought a refund of Rs. 15,20,802.62 for the period from December 1982 to December 1984. The appellant's representative argued that coercive recovery actions forced them to pay in 1988, even though production ceased in 1984. They claimed that the refund was not tainted with unjust enrichment as duty paid under coercion in 1988 for clearances in 1982-84 could not have reached the consumer without evidence. The appellant cited relevant case law to support their position.

2. Classification of Yarn:
Another issue involved the classification of Viscose and NC Synthetic Waste Blended Yarn, which was finalized by the Tribunal's order dated 24-6-1991. The classification was under old T.I. 18-III(1), as the Revenue's appeal was dismissed by the Supreme Court. This classification issue was settled, and the Tribunal's decision was cited to support this conclusion.

3. Analysis of Arguments:
The Advocate for the appellants argued that the refund claim was wrongly credited to the Consumer Fund as they did not pass on the duty burden to consumers. The JDR reiterated the Order-in-Appeal, emphasizing the lack of proforma invoices as a basis for rejecting the refund claim. The original authority highlighted the absence of proforma invoices linking duty burden to final invoices, leading to doubts about passing on the duty burden. The burden of proof was on the appellants, and the absence of proforma invoices raised suspicions about passing on the duty burden.

4. Judgment and Conclusion:
The Tribunal analyzed the arguments and found that the appellants failed to adequately prove that the duty burden was not passed on to buyers. The absence of proforma invoices and the generic description of the yarn in final invoices raised doubts. The Tribunal concluded that the burden of proof was not discharged by the appellants, leading to the dismissal of the appeal. The case law cited by the Advocate was distinguished, and it was held that there was no basis for interfering with the impugned order. The appeal was ultimately dismissed based on the lack of evidence to support the appellants' claim.