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2014 (10) TMI 374 - AT - Central ExciseDenial of refund claim - Unjust enrichment - Relevant documents not produced - Held that - Refund claims were rejected on the ground that relevant documents were not produced by the appellant. In that situation, the adjudicating authority would not have considered the issue of bar of unjust enrichment. Therefore, the ground raised by the learned Advocate that they have rejected the refund claim on the new ground is not acceptable. In fact, while considering the refund claim it was found that they are entitled for the refund claim and at this stage the issue of bar of unjust enrichment comes. Therefore, I do not find any force in the argument of the learned A.R. that in the remand proceedings the refund claim has been rejected on the new ground. Further, in the case of Hindalco Industries Ltd. (2006 (2) TMI 337 - CESTAT, MUMBAI), this Tribunal held that in the case of provisional assessment, after following the judgment of the Hon ble Apex Court in the case of Allied Photographics India Ltd. (2003 (11) TMI 91 - SUPREME COURT OF INDIA) and the decision of Sahakari Khand Udyog Mandal Ltd., bar of unjust enrichment is not applicable. following the decision of Allied Photographics India Ltd. (supra) - Decided in favour of assessee.
Issues:
Appeal against denial of refund of duty paid based on unjust enrichment. Analysis: 1. Issue of Denial of Refund: The appellants appealed against the denial of the refund of duty paid during the original assessment, citing the reason that the claim was rejected on the grounds of unjust enrichment. The case involved the manufacturing of Brake Linings & Clutch facings, where intermediate products emerged during the process. The Revenue contended that duty was payable on these intermediate products, but the appellant disagreed, leading to payment of duty under protest and opting for provisional assessment. The matter was finally settled by the Hon'ble Apex Court, ruling that duty was not required on these intermediate products as they were not marketable. Subsequently, refund claims were filed by the appellant, which were rejected by lower authorities for lack of relevant documents. The Tribunal remanded the matter to the adjudicating authority to consider the documents produced by the appellant to determine if duty had been paid. The refund was granted but credited to the Consumer Welfare Fund due to unjust enrichment, leading to the appellant's appeal. 2. Contention of the Appellant: The appellant argued that as the refund claim arose from provisional assessment, the bar of unjust enrichment should not apply, citing the judgment of the Hon'ble Apex Court in a similar case. The appellant also highlighted that during the initial litigation, the Tribunal had directed consideration of documents to verify duty payment, without any mention of unjust enrichment. Referring to relevant case laws, the appellant contended that a new issue of unjust enrichment could not be raised during the remand proceedings. 3. Respondent's Submission: On the contrary, the learned A.R. argued that it was unclear whether the duty had been paid under protest by the appellant, making it necessary for all refund claims to pass the test of unjust enrichment, as per the Hon'ble Apex Court's ruling in a different case. 4. Judgment and Decision: The Tribunal observed that during the initial rejection of refund claims, the issue of unjust enrichment was not considered due to the lack of relevant documents. Therefore, the argument that the rejection was based on a new ground during remand proceedings was dismissed. Citing precedents, the Tribunal held that in cases of provisional assessment following the judgments of the Hon'ble Apex Court, the bar of unjust enrichment does not apply. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief. In conclusion, the Tribunal's decision favored the appellant, setting aside the denial of the refund claim based on unjust enrichment and allowing the appeal in light of the specific circumstances and legal precedents cited during the proceedings.
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