2023 (12) TMI 432 - AT - Central Excise

Violation of principles of unjust enrichment - Denial of access to eligible refund of duties of central excise, arising from finalization of provisional assessment for clearances effected from April 2011 to June 2011 - HELD THAT - It is seen that several orders of the Tribunal have held that such refunds cannot be withheld on the ground of unjust enrichment. Furthermore, these were not only accepted but also those in which first appellate authority followed the decision of the Tribunal. Reliance can be placed in M/S. SAVITA OIL TECHNOLOGIES LTD. VERSUS COMMISSIONER OF CGST CE, BELAPUR 2023 (2) TMI 1225 - CESTAT MUMBAI where it was held that In case of N G Thakkar 2012 (3) TMI 248 - BOMBAY HIGH COURT it has been held that the decisions of the lower appellate authorities that the duty element has not been passed on to the customers is based on verification of the evidence adduced by the assessee. There are no merit in the impugned order which is set aside - appeal allowed.

Summary

Issues Involved:
1. Denial of access to eligible refund of duties of central excise due to the bar of 'unjust enrichment.'
2. Finalization of provisional assessment and the resultant claim for refund.
3. Consistency with prior Tribunal decisions and acceptance by the revenue authorities.

Summary:

1. Denial of access to eligible refund of duties of central excise due to the bar of 'unjust enrichment':
The dispute centers on the denial of a refund of duties of central excise, following the finalization of provisional assessment for clearances from April 2011 to June 2011, invoking the bar of 'unjust enrichment' under section 11B of the Central Excise Act, 1944. The appellant, M/s Savita Oil Technologies Ltd, had paid excess duty which was later appropriated to the 'Fund' due to non-inclusion of 'duties of central excise' in the downstream entity's invoice and the non-acceptance of the Chartered Accountant's certificate.

2. Finalization of provisional assessment and the resultant claim for refund:
The jurisdictional central excise authority found that some clearances had excess duty payments amounting to Rs. 4,01,506, while others were short-paid by Rs. 10,388. The resultant claim for refund was sanctioned but appropriated to the 'Fund' due to the aforementioned reasons. The initial denial was upheld by the Commissioner of Central Excise (Appeals), Mumbai-III, but was remanded back by the Tribunal for a detailed order, which is now under challenge.

3. Consistency with prior Tribunal decisions and acceptance by the revenue authorities:
The appellant cited previous favorable decisions by the Tribunal for other periods, such as Savita Oil Technologies Pvt Ltd v. Commissioner of Central Excise, Belapur, and instances where similar denials were reversed by the first appellate authority and accepted by the revenue authorities. The Tribunal has consistently held that such refunds cannot be withheld on the ground of unjust enrichment, and these decisions have been accepted by the revenue authorities. The Tribunal also referenced several past orders where refunds were allowed under similar circumstances, reinforcing the appellant's position.

Conclusion:
The Tribunal found no merit in the impugned order and set it aside, allowing the appeal. The decision was pronounced in the open court on 30/11/2023, aligning with the settled law and consistent past rulings in favor of the appellant.