2018 (3) TMI 1119 - AT - Central Excise

Refund claim - duty paid under protest - Held that - inasmuch as the dispute relates to the factual position, which can only be verified at the level of the original adjudicating authority, we deem it fit to set aside the impugned order and remand the matter to the original adjudicating authority, who would verify the fact of payment of duty under protest by M/s Godrej & Boyce or alternatively the assessment being provisional - appeal allowed by way of remand.

Summary

Issues:
- Claim of exemption under Notification No. 10/97
- Finality of assessment at the end of M/s Godrej & Boyce
- Payment of duty under protest by M/s Godrej & Boyce

Analysis:
1. The appellant, a Scientific, Technical R&D Organization, placed an order for Network Antenna with M/s Electronics Corporation of India Ltd. (ECIL), who sub-contracted the manufacturing to M/s Godrej & Boyce. The latter claimed exemption under Notification No. 10/97 for goods supplied to public-funded research institutions. However, the Revenue rejected the claim, and M/s Godrej & Boyce cleared the goods by paying duty at 16.32% ad valorem. The appellant, in turn, filed a refund claim under the same notification, which was denied by the lower authority citing non-challenge of M/s Godrej & Boyce's assessment.

2. The main issue in the appeal was whether the assessment at the end of M/s Godrej & Boyce was final or not. The appellant's advocate acknowledged that the letter from the Revenue, dated 28.10.2005, was not challenged by M/s Godrej & Boyce before any higher forum. However, the advocate argued that M/s Godrej & Boyce advised ECIL to clear the goods under protest due to urgency for the national "CHANDRAYAN" project, though no documentary evidence was presented at that stage.

3. The Tribunal observed that the factual dispute regarding the payment of duty under protest or the provisional nature of the assessment could only be verified by the original adjudicating authority. Citing legal precedents from the Supreme Court, the Tribunal decided to set aside the impugned order and remand the matter for verification of facts. The Tribunal emphasized that the legal position was clear as per the Supreme Court decisions in the cases of Flock India and Priya Blue Industries Ltd., and the original authority should decide the issue accordingly.

4. Consequently, both appeals were allowed by way of remand, directing the original adjudicating authority to verify the factual position and make a decision in line with the Supreme Court judgments referenced.