2017 (3) TMI 235 - AT - Central Excise

Refund claim - duty was paid in excess on clearance of the goods - reduction in price due to post clearance discount - quantum is finalised subsequently on periodic basis - Held that - The dealer, who received the goods from the manufacturer, may charge to his buyer the full amount of duty ignoring the duty reduced by manufacturer and the said fact cannot be a ground for denying the refund to the manufacturer - There is no concept of not passing on the duty to the ultimate consumer and as such, as the buyers have been passed on the benefit of reduction of duty, the same would satisfy the principles of unjust enrichment. Appeal dismissed - decided against Revenue.

Summary

Issues:
1. Refund claim allowed by Commissioner (Appeals) and remanded for fresh decision.
2. Rejection of refund claims for various periods due to time bar and lack of supporting documents.
3. Provisional assessment facility extension and bond requirement.
4. Discount structure knowledge to buyers and unjust enrichment issue.

Analysis:

Issue 1:
The Revenue appealed against the Commissioner (Appeals) allowing the refund claim and remanding the matter for a fresh decision. The Tribunal noted that the Commissioner directed to decide the refund claim afresh based on observations in the impugned order.

Issue 2:
Refund claims for different periods were rejected due to being time-barred under Section 11B of the Act and lack of supporting documents. The appellant argued that the discount structure was known to buyers before purchasing goods, and the burden of unjust enrichment was not discharged by the assessee. However, the Tribunal found that the price variation due to discounts had been adjusted in customer ledger accounts through credit notes, satisfying the principles of unjust enrichment.

Issue 3:
The Commissioner (Appeals) held that the appellant was entitled to provisional assessment facility extension since March 2006, and the execution of a bond was not mandatory. The Tribunal referred to a Supreme Court ruling to support this decision, emphasizing that the dealer should not suffer due to the inaction of the Department.

Issue 4:
Regarding the discount structure knowledge to buyers and unjust enrichment issue, the Tribunal cited previous orders and legal precedents. It was established that the buyers had received the benefit of reduced duty through credit notes, satisfying the principles of unjust enrichment. The Tribunal dismissed the Revenue's appeals and disposed of the cross objections by the assessee accordingly, based on the precedents and findings in the dispute between the parties.

In conclusion, the Tribunal upheld the Commissioner (Appeals)' decision to allow the refund claim and remand the matter for fresh consideration, considering the issues of time bar, lack of supporting documents, provisional assessment facility, discount structure knowledge, and unjust enrichment in detail based on legal principles and precedents.