2016 (1) TMI 271 - AT - Central Excise

Denial of refund claim - Unjust enrichment - finalisation of provisional assessment - Held that - In view of the decision of the Larger Bench of the Tribunal in the case of Panasonic Battery India Co. Ltd (2013 (9) TMI 652 - CESTAT AHMEDABAD ), unjust enrichment will not be applicable prior to 25.06.1999. The refund claim for the period on or after 25.06.1999 is required to be considered in the light of the decision of Hon ble Gujarat High Court 2008 (10) TMI 597 - GUJARAT HIGH COURT . - refund claim on finalization of provisional assessment under Rule 9B of the erstwhile Rules, 1944 for the period prior to 25.06.1999 cannot be rejected on the ground of unjust enrichment. Accordingly, we set aside the impugned order to the extent of rejection of refund claim of ₹ 1,01,37,561.00. We allow the refund claim for the period prior to 25.06.1999 - Matter remanded back - Decided partly in favour of assessee.

Summary

Issues:
1. Rejection of refund claim arising from finalization of provisional assessment under Rule 9B of Central Excise Rules, 1944.
2. Applicability of unjust enrichment principle to refund claims prior to and after 25.06.1999.
3. Interpretation of Tribunal's decision in CCE & ST., Vadodara-II Vs M/s Panasonic Battery India Co. Ltd.
4. Consideration of decisions by Hon'ble Gujarat High Court regarding refund eligibility.

Analysis:
1. The primary contention in this case revolves around the rejection of a refund claim amounting to Rs. 1,01,37,551.00 for the period December 1997 to September 2000, arising from the finalization of provisional assessment under Rule 9B of the erstwhile Central Excise Rules, 1944.

2. The Tribunal, referencing the decision in CCE & ST., Vadodara-II Vs M/s Panasonic Battery India Co. Ltd, established that the principle of unjust enrichment does not apply to refund claims related to provisional assessments finalized before 25.06.1999, even if the assessments were concluded after this date. This ruling emphasizes the distinction between entitlement to refund and the process of claiming a refund, particularly concerning the amendment introduced by Notification No. 45/99-CE(NT) on 25.06.1999.

3. The learned Advocate for the Appellant cited the decision of the Hon'ble Gujarat High Court in CCE & Cus Vs Alembic Ltd, asserting the eligibility for refunds post 25.06.1999. Notably, the Adjudicating authority had not addressed this specific decision, and the Larger Bench's ruling was issued subsequent to the impugned Adjudication order.

4. Consequently, the Tribunal determined that the rejection of the refund claim based on unjust enrichment for the period preceding 25.06.1999 was unfounded. The refund claim for this period was deemed valid in alignment with the Larger Bench's decision, while the consideration of refund claims from 25.06.1999 onwards was directed to be evaluated in accordance with the Hon'ble Gujarat High Court's judgment. The Appellant's appeal was remanded with instructions for the Adjudicating authority to provide a fair hearing before issuing a revised order.

This comprehensive analysis of the judgment highlights the nuanced legal interpretations surrounding refund claims arising from provisional assessments and the application of the unjust enrichment principle within the specified legal framework.