2018 (6) TMI 325 - AT - Central Excise

Refund of double payment of duty made - For the month of June, 2014, the appellant paid duty of ₹ 17,44,041/- vide challan dated 02.02.2014, in the name of M/s. Kanishk Steel Industries inadvertently. On realising the mistake on the same date, they paid the amount of ₹ 17,44,041/- in their own name - The refund has been denied stating that the amount so paid is lying in the PLA account of M/s. Kanishk Steel Industries and, therefore, the appellant is not eligible for refund. Held that - The Hon ble High Court of Madras, in the case of M/s. Sundaram Industries Ltd. Vs. CCE Madurai 2015 (5) TMI 416 - MADRAS HIGH COURT , had considered a similar issue, and on production of No Objection letter from the company concerned, it was held by the High Court that refund has to be granted - In the present case also, the disclaimer certificate furnished by the appellant along with the refund claim - rejection of refund is without any legal basis - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim for double payment made by appellant during demerger, rejection of refund claim by original authority and Commissioner (Appeals), eligibility for refund without No Objection Certificate from M/s. Kanishk Steel Industries.

Analysis:
The case involved the appellants, engaged in sponge iron manufacturing, who filed a refund claim of ?17,44,041/- for double payment made during June 2014 after a demerger. The appellant-company came into existence post the demerger of M/s. Kanishk Steel Industries Limited. The appellant paid duty inadvertently in the name of the former company and then corrected the payment by paying the same amount in their own name. Despite submitting relevant documents like bank statements, invoices, e-payment challans, and a disclaimer certificate from M/s. Kanishk Steel Industries, the refund claim was rejected by the original authority and upheld by the Commissioner (Appeals).

During the proceedings, the appellant's counsel argued that the amount was mistakenly paid into the former company's account and was subsequently paid to the appellant's account on the same day. The rejection of the refund claim was based on the funds lying in the PLA account of M/s. Kanishk Steel Industries without a No Objection Certificate. The counsel highlighted a similar case decided by the Hon'ble High Court of Madras, where a refund was granted upon submission of a No Objection letter from the concerned company.

The Tribunal noted that the disclaimer certificate from M/s. Kanishk Steel Industries stated that they had no objection to the refund being granted to the appellant. Citing legal precedent and the documents submitted, the Tribunal found the rejection of the refund claim to be without any legal or factual basis. Consequently, the Tribunal set aside the impugned order, ruling in favor of the appellants and allowing the appeal with any consequential reliefs.