2014 (5) TMI 130 - AT - Central Excise

Denial of rebate claim - Unjust enrichment - whether doctrine of unjust enrichment will be applicable to the rebate claims under the Sugar Incentive Scheme - Held that - Tribunal in the case of CCE Meerut Vs Kisan Sahkari Chini Mills Ltd vide 2013 (3) TMI 210 - CESTAT NEW DELHI relying upon the decision of Hon ble Supreme Court in Sahakari Khand Udyog (2005 (3) TMI 116 - SUPREME COURT OF INDIA) has held that doctrine of unjust enrichment would be applicable to rebate under the excess production scheme in respect of sugar. We after following the decision dated 26.9.2012 of the Tribunal in the case of Kisan Sahkari Chini Mills holding the applicability of unjust enrichment in rebate claims - Decided against assessee.

Summary

Issues:
Whether the doctrine of unjust enrichment is applicable to rebate claims under the Sugar Incentive Scheme.

Analysis:
The appeal was filed against the order by the Commissioner of Central Excise (Appeals) rejecting a refund claim by M/s Chhata Sugar Company Ltd. The appellants claimed they overpaid duty on sugar cleared during a specific period due to not claiming a concession under Notification No. 130/83. The Assistant Commissioner initially rejected their claim, leading to an appeal before the Tribunal. The Tribunal remanded the matter to the Assistant Commissioner for clear findings on the refund entitlement under Notification No. 130/83 and unjust enrichment consideration.

Subsequently, the Assistant Commissioner rejected the claim on merits, stating that unjust enrichment consideration was unnecessary. The Commissioner of Central Excise (Appeals) allowed the appeal on merits but rejected it on the grounds of unjust enrichment. The appellants contended that they were eligible for the Notification No. 130/83 benefit under the sugar incentive scheme and had paid duty at the normal rate initially. They argued that the doctrine of unjust enrichment should not apply to the sugar rebate incentive scheme, citing a Tribunal decision in a similar case.

On the other hand, the Revenue argued that the doctrine of unjust enrichment could apply to sugar rebate claims, referencing a Supreme Court decision. The Tribunal analyzed the issue and noted the conflicting views on the applicability of unjust enrichment to rebate claims under the Sugar Incentive Scheme. It referenced a previous Tribunal decision and a Supreme Court ruling, ultimately upholding the order rejecting the appeal based on the applicability of unjust enrichment in rebate claims under the Sugar Incentive Scheme.

In conclusion, the Tribunal found that the doctrine of unjust enrichment would be applicable to rebate claims under the Sugar Incentive Scheme, aligning with the decision in a previous case. As a result, the appeal filed by the appellants was rejected based on the established precedent regarding unjust enrichment in such cases.