2017 (6) TMI 314 - AT - Central Excise

Turnover tax - eligibility for deduction - Held that - turnover tax is not of admissible deduction has been rejected by the Commissioner(Appeals) by relying upon the following decision in the case of Bangalore Paints Ltd. Vs. CCE 2001 (3) TMI 165 - CEGAT, BANGALORE . The adjudicating has finalised provisional assessment on the basis turnover of top 10 depots. As there was no clearance from 4 depots, the assessments were finalised based on the basis of documents produced by the respondent in respect of these depots. Appeal dismissed - decided against Revenue.

Summary

Issues:
- Finalization of provisional assessments based on clearances from only 10 depots
- Validity of turnover tax deduction
- Application of doctrine of unjust enrichment to refunds arising from finalization of provisional assessments

Finalization of provisional assessments based on clearances from only 10 depots:
The appeal was filed by the Revenue against the Commissioner(Appeals)'s decision upholding the Order-in-Original and dismissing the Department's appeal. The Department argued that the assessments were finalized based on clearances from only 10 depots, while all depots should have been considered. The Department also contended that turnover tax deduction was wrongly granted, and refunds from finalization of provisional assessments should be subject to the doctrine of unjust enrichment. However, the Tribunal found that the assessments were finalized based on clearances from the top 10 depots, with adjustments made for depots with no clearances. The Tribunal noted that a similar issue had been decided in favor of the respondent in a previous case, and hence, upheld the impugned order, dismissing the Revenue's appeal.

Validity of turnover tax deduction:
The Department argued that turnover tax deduction was not valid, but the Commissioner(Appeals) rejected this argument, citing precedents such as Bangalore Paints Ltd. Vs. CCE and Karnataka Soaps & Detergents Ltd. Vs. The Tribunal found that the turnover tax deduction issue had already been settled in favor of the respondent in previous cases and upheld the Commissioner(Appeals)'s decision on this matter.

Application of doctrine of unjust enrichment to refunds arising from finalization of provisional assessments:
The Department raised the issue of refunds from finalization of provisional assessments being subject to the doctrine of unjust enrichment. However, the Tribunal, considering the arguments presented and the previous decisions favoring the respondent, concluded that the doctrine of unjust enrichment would not apply in this case. The Tribunal referenced decisions such as Goetze (India) Ltd. Vs. CCE, Vinir Engineering Pvt. Ltd. Vs. CCE, Needle Industries (India) Ltd. Vs. CC&CE, and Nestle (India) Ltd. Vs. CCE to support its decision. Consequently, the Tribunal upheld the impugned order, dismissing the Department's appeal.

In conclusion, the Tribunal, after hearing both parties and examining the records, upheld the Commissioner(Appeals)'s decision, dismissing the Revenue's appeal on all issues raised, including the finalization of provisional assessments, validity of turnover tax deduction, and the application of the doctrine of unjust enrichment to refunds.