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TMI Blog2006 (12) TMI 373X X X X Extracts X X X X X X X X Extracts X X X X ..... to a conclusion that there was higher duty paid by the assessee. The Original Authority rejected the prayer on the ground that the credit notes had been issued and therefore, it was hit by the provisions of unjust enrichment but the Commissioner (A) set aside the order on the ground that the transaction clearly discloses that it was provisional and the account had been settled in the end resulting in assessee not receiving any excess amounts and therefore, he allowed refund by rendering a finding that there was no unjust enrichment. Revenue is aggrieved with this order and in terms of the Larger Bench judgment of S. Kumar s Ltd. v. CCE, Indore - 2003 (153) E.L.T. 217 (Tri.-LB) wherein it has been held that refund will be hit by unjust enrichment in cases where credit notes were issued by the assessee. 2. The learned JDR seeks for setting aside the impugned order. 3. The learned Counsel submits that the circumstances discussed in the Larger Bench judgment does not apply to the present case. In the case of S. Kumar s the facts were that the credit notes are issued simpliciter and there was no provisionality of assessment and hence, this judgment is distinguishable. He submits tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time of removal of goods as provisional in nature and was to be settled later. The credit notes issued on a monthly basis were the result of settling of rate. We are, therefore, of the opinion that lower authorities have not rightly understood the nature of transaction, that sale price was provisional at the time of original removal of the goods and was subsequently settled by issue of credit notes. They were in error in holding that price was known at the time of removal and issue of credit notes only indicated post-sale revision of prices. According to Section 4 of the Central Excise Act, in a case of sale of goods, the transaction value is to constitute the assessable value. The appellant s transactions with their dealers are clearly cases of sale and that transaction value is the value determined after issue of credit notes. The account of each dealer is settled every month at the rate discounted by the credit note amount. There was no further amount paid or payable over and above that net amount. Therefore, the discounted amount, net of the credit note, was required to be treated as assessable value. Since original payment of duty was based on amounts higher than the transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to be not covered by the unjust enrichment as higher duty had been paid. The finding recorded in Para 6 is reproduced herein below : 6. We have gone through the records of the case carefully. When the rate of duty payable was only 9.6%, the respondents had paid 12.8% duty. In other words, during the period when duty at higher rate was paid, the duty actually payable was only at lower rate. In these circumstances, the correct presumption of the Revenue should be that the correct rate of duty payable is passed on to the buyer and not that the higher duty wrongly paid had been passed on. To put it differently, even when the respondent paid duty to the exchequer at the rate of 12.8%, what has been passed on to the buyer is only at 9.6%. Hence, only the lower rate of duty has been passed on to the buyer, whereas the respondent paid more duty to the Government. Hence, the respondent is rightly entitled for the excess duty paid to the Government and which has not been passed on to the buyer. When the respondent realized the mistake, the price remained the same. He started paying only at 9.6% and the duty passed on to the buyer is also the same. From the above discussion, it is clear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and withdrawal of their claim against the buyer as latter refused to pay the price including the duty, as recorded in the invoices. 3. In the light of the discussion made above, the impugned order is set aside. The appeal of the appellants is accepted with consequential relief, if any, permissible under the law. 7. The learned JDR relied on the ruling of S. Kumar s Ltd. (supra). He also relied on the ruling of Apex Court judgment rendered in the case of CCE, Khanpur v. Flock (India) Pvt. Ltd. - 2000 (120) E.L.T. 285 (S.C.). This judgment is distinguished by the learned Counsel on the ground that CCE v. Flock (India) s (supra) case applies only to the cases where the assessment order has not been challenged. In the present case, it is the case of refund and not a case of assessment. 8. On a careful consideration, I notice that the ruling of S. Kumar s and CCE v. Flock (India) Pvt. Ltd. cited supra are not applicable to the facts of the present case. The ruling rendered in the case of Alstom Ltd. v. CCE; CCE v. Audithiya Minerals Ltd.; and CCE v. Triveni Glass Pvt. (supra) clearly apply to the facts of the present case. The customer had issued CT3 certificate, which clearly i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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