2016 (11) TMI 993 - AT - Central Excise

Rejection of refund claim - Benefit of Notification No.6/94 dated 01/03/94 - benefit of concessional rate of duty - unjust enrichment - Held that - From the Chartered Accountant s certificate it has been submitted by the appellant for the first time in Tribunal. I find that the claim of the appellant that the price to the dealer before and after the period in dispute is the same is incorrect. It can be seen from the certificate that the price for sale in outside Maharshtra have in fact reduced and changed a number of times during this period - the cum duty price of the product is not related strictly to the availment of exemption. In fact the assertion of the appellant that price has been uniform is misplaced and is not correct. Section 11B of the Central Excise Act, 1944 put the onus of proving all the burden of duty has not been passed on to the customers and passed on claiming the refund. It is clear that the simple fact that the price of the product was uniform does not lead to a conclusion that incidence of duty has not been passed on - appeal dismissed - decided against appellant.

Summary

Issues:
Challenge to denial of benefit of Notification No.6/94, rejection of refund claim based on unjust enrichment.

Analysis:
1. Challenge to Denial of Benefit of Notification No.6/94:
The case involved M/s. Midas Care Pharmaceuticals Pvt. Ltd. challenging the denial of the benefit of Notification No.6/94 for their product "Lidocaine USP." The appellant filed a revised classification list under protest and paid duty at the tariff rate during the appeal process. The Commissioner (Appeals) ruled in favor of the appellant, leading to a refund claim for the duty paid during the appeal period. However, the original adjudicating authority rejected the refund claim, stating that the appellant failed to prove non-passing of duty incidence to customers as per Section 11B. The appellant then appealed to the Tribunal.

2. Unjust Enrichment and Refund Claim:
The appellant argued against unjust enrichment, claiming that the product price to dealers remained consistent despite paying duty under protest. They presented a Chartered Accountant's certificate to support their case. The appellant cited case laws to support their argument, emphasizing that the price stability indicated no passing on of duty incidence. On the contrary, the respondent contended that price uniformity does not necessarily imply non-passing of duty incidence, referring to various factors affecting pricing. The Tribunal examined the Chartered Accountant's certificate and found discrepancies in the product prices across different regions, concluding that the appellant's claim of price uniformity was incorrect. The Tribunal upheld the principle that uniform pricing does not automatically prove non-passing of duty incidence, citing the Supreme Court's decision in Allied Photographics India Ltd. case.

In conclusion, the Tribunal dismissed the appeal on 13/04/2016, emphasizing that the appellant's argument based on price uniformity did not establish non-passing of duty incidence as required by Section 11B. The Tribunal highlighted the importance of considering all relevant factors and upheld the decision based on legal precedents, ultimately ruling against the appellant's refund claim.