2016 (6) TMI 234 - AT - Central Excise

Rejection of refund claim on the grounds of unjust enrichment - payment of duty under protest on broken glass bottles - Held that - In respect of all the invoices in which at the time of clearance the duty payment has been shown in the invoice, there is no doubt that the burden of duty has been passed on to the customers in such cases. The provisions of unjust enrichment have been rightly invoked in such cases. In respect of first category mentioned by the learned Counsel where they have paid the duty under protest for the past period, the facts are slightly different. In that case the appellant had paid the duty for the past period and not issued the excise invoices but had issued only the commercial invoices. In respect of other payment of duty the appellants have claimed that they have not recovered the same from the customers. The appellants have also produced Chartered Accountant s certificate in the Tribunal, the same was not produced before the Commissioner (Appeals). Thus find that while the impugned order deals with the second situation, it is silent about the first situation. In view of the above, upheld the impugned order so far as it relates to the clearances made on payment of duty. However, in respect of refund claim on the duty paid for the past clearances, the impugned order is set aside and the matter is remanded to the Commissioner (Appeals) for giving his findings on the issue. Further, since the Chartered Accountant s certificate has been produced for the first time in the Tribunal and it was not produced before the Commissioner, the same may also be considered along with other evidence.

Summary

Issues Involved:
- Appeal against rejection of refund claim on grounds of unjust enrichment in relation to duty paid by appellants.
- Determination of unjust enrichment regarding two categories of refund claims: duty paid after clearances under protest and duty paid at the time of clearances under protest.
- Interpretation of evidence regarding passing on the duty to customers through invoices.
- Consideration of Chartered Accountant's certificate as evidence for refund claim on duty paid for past clearances.

Analysis:
1. The appellants contested the rejection of their refund claim based on unjust enrichment after paying duty under protest for clearances of broken glass bottles. The Assistant Commissioner credited the refund to the Consumer Welfare Fund due to unjust enrichment concerns, leading to an appeal before the Tribunal.

2. The Counsel for the appellants argued that unjust enrichment did not apply, distinguishing between duty paid after clearances under protest and duty paid at the time of clearances under protest. Citing precedents like Tehri Steels Ltd. case, they asserted that the duty amount was not recovered from customers post-duty payment initiation.

3. The Revenue's Assistant Commissioner supported the initial decision, emphasizing the unjust enrichment aspect.

4. The Tribunal analyzed the evidence, noting discrepancies in price between commercial and excise invoices. It observed that the duty had been passed on to customers through invoices, as upheld by the original adjudicating authority's findings.

5. Referring to the Supreme Court's decision in CCE vs. Allied Photographics India Ltd., the Tribunal highlighted that uniform pricing before and after duty assessment did not negate duty passing to buyers. It affirmed that customers availing Cenvat Credit indicated the duty burden being transferred to them.

6. The Tribunal differentiated between the two categories of refund claims. For duty paid for past clearances under protest, it remanded the matter to the Commissioner (Appeals) for further examination, considering the Chartered Accountant's certificate presented as new evidence.

7. Ultimately, the Tribunal upheld the decision regarding refund for clearances made on payment of duty but remanded the case concerning duty paid for past clearances for additional review, taking into account the new evidence presented.

This comprehensive analysis of the judgment highlights the key legal issues, arguments presented, evidentiary considerations, and the Tribunal's decision regarding the refund claim and unjust enrichment concerns raised by the appellants.