2016 (1) TMI 385 - AT - Central Excise

Benefit of Notification No.6/2003-CE dated 01/03/2003 - 100% EOU - DTA Clearances - Denial of refund claim - Unjust enrichment - Held that - Respondent filed refund claim with the lower authorities for sanctioning the refund of the amount which was paid during the proceedings. The adjudicating authority rejected the refund claim on the ground that the documents which were furnished are not sufficient and they have not passed on the incidence of duty to any other person. On appeal, the first appellate authority reversed the order-in-original and held that the appellant has produced various documents before him and that he has not passed on the incidence of duty to their clients. Holding so he allowed the appeal filed by the respondent with direction to the lower authorities to refund the amount to the respondent. The Revenue s case is that the appellant had not passed the hurdle of unjust enrichment and has not provided any documents as also that the CVD payable is as per tariff rate. We find that as regards the discharge of CVD, we held that CVD has been correctly discharged @ ₹ 30/- per Sq. Mtr. Hence, on this point, there cannot be any dispute. First appellate authority has categorically recorded that invoices raised by the respondent indicate only discharge of Central Excise duty as per Notification No.6/2003-CE and the amount deposited were subsequent to the clearances made by them. On perusal of the records, we find it so. We perused the invoices and also copies of the certificate issued by the various buyers to the respondent herein. We find that the certificates clearly indicate that the purchasers have not paid any excess amount to the appellant as Central Excise duty/CVD. - Impugned order is correct - Decided against Revenue.

Summary

Issues:
- Central Excise duty payable by a 100% EOU while making clearance to DTA
- Eligibility for the benefit of Notification No.6/2003-CE dated 01/03/2003
- Refund claim for the duty paid by the respondent at the adjudication stage
- Doctrine of unjust enrichment applicability

Central Excise Duty Payable by 100% EOU to DTA:
The case involved appeals filed by the Revenue against the Order-in-Appeal passed by the Commissioner of Central Excise (Appeals) regarding the Central Excise duty payable by a respondent, a 100% EOU, while clearing goods to DTA. The respondent, a manufacturer of granite and marble slabs, cleared goods to DTA and discharged CVD at a specific rate under Notification No.6/2003-CE dated 01/03/2003. The Revenue contended that as an EOU, the respondent should discharge CVD at the tariff rate of 16% ad valorem. The adjudicating authority relied on case laws and dropped the proceedings initiated by the show-cause notice. The first appellate authority concurred with the adjudicating authority's views, upholding the decision.

Eligibility for Benefit of Notification No.6/2003-CE:
The first appellate authority considered the issue of whether the refund claim was subject to the doctrine of unjust enrichment. The authority examined the evidence provided by the appellants, including invoices, CA certificates, and letters from customers, to determine if the burden of duty had been passed on. The authority referred to relevant case laws and held that the appellants had produced sufficient documentary evidence to show that the duty incidence had not been passed on to customers. The authority concluded that the bar of unjust enrichment was not applicable, and the refund was admissible to the appellants.

Doctrine of Unjust Enrichment Applicability:
In the appeal related to the refund claim, the first appellate authority reversed the adjudicating authority's decision and allowed the appeal filed by the respondent for refund. The Revenue argued that the appellant had not passed the hurdle of unjust enrichment and had not provided sufficient documents. However, the first appellate authority found that the invoices and certificates indicated that the duty had not been passed on to customers. The CA certificate provided by the appellant further supported that the amounts paid were from the appellant's own pocket and not passed on. The Tribunal upheld the first appellate authority's decision, stating that there was no reason to interfere with the reasoned order.

In conclusion, the Tribunal rejected the appeals, affirming the correctness and legality of the impugned orders-in-appeals. The decisions were based on the factual findings, relevant case laws, and the absence of evidence supporting the Revenue's contentions regarding Central Excise duty, eligibility for benefits, and unjust enrichment.