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TMI Blog2005 (9) TMI 585X X X X Extracts X X X X X X X X Extracts X X X X ..... Court judgment in Oswal Agro Mills v. CCE - 1994 (73) E.L.T. 521 (S.C.). A review petition against the said judgment has been dismissed by the Court vide 1994 (70) E.L.T. 48 (S.C.). Thus the ratio of the said case that a Bank Guarantee is only a security and not a payment and therefore not subject to provisions of Section 11B was binding on the lower authority. (ii) The lower authority wrongly relied upon the observations of the Apex Court in U.O.I. v. Jain Spinners - 1992 (61) E.L.T. 321 (S.C.). The said case was on an entirely different footing and the Court had permitted withdrawal of money deposited with the Court. It was not encashment of Bank Guarantee. (iii) The lower authority failed to appreciate that the question of unju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llants is that the principle of unjust enrichment is not applicable when the duty was only secured by Bank Guarantee and not paid. In support of this, reliance is placed on Apex Court judgment in Oswal Agro Mills Ltd. case. The relevant para of the said judgment is reproduced below. The question, therefore, is whether it can be said that the furnishing of a Bank Guarantee for all or part of the disputed Excise duty pursuant to an order of the court is equivalent to payment of the amount of excise duty. In our view, the answer is in the negative. For the purposes of securing the Revenue in the event of the Revenue succeeding in proceedings before a Court, the Court, as a condition of staying the demand for the disputed tax or duty, impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fifty percent of the disputed amount with the Excise Authorities. Though the case was ultimately decided in favour of the appellants, the Bank Guarantees had already been encashed by the Revenue by treating the same as deposited in its favour, in view of the High Court s order. It was observed by the court that - we find behaviour of the Excise Department highly improper. Bank Guarantees are furnished to secure interests of the parties till determination of matters pending before Court. The Court directed the revenue to re-pay the amount of Rs. 1,18,00,000/- to State Bank of Patiala from whom it had been encashed. 6. The dispute of the appellants was that the processing did not amount to manufacture and was consequently not chargea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtment was entitled to enforce the Bank Guarantees and accordingly the Department approached the Registry for encashment of Bank Guarantees amounting to Rs. 5,39,81,256.31. The appellants also approached the registry contending that in view of the clarificatory order dt. 27-1-1989 the guarantees could not be enforced. Ultimately the matter was placed before Division Bench for directions. By order dt. 16-10-92, the Court held that the department was entitled to encash the Bank Guarantees in view of the operative part of the Supreme Court s judgment and there was nothing in the clarificatory order to prevent encashment of Bank Guarantees and directed the registry to encash the Bank Guarantees positively on 9-11-1992. 9. In the background ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11B (amended)... Sub-Section (3) of the amended Sec. 11B is emphatic. It leaves no room for making any exception in case of refund claims arising as a result of decision in appeal/reference/writ petitions. There is no reason why an exception should be made in favour of such claims, which would nullify the provision to a substantial degree. 12. In para 72 and 73 referring to the provisions of Sec. 64A of Sale of Goods Act 1930, the Court observed that it would be legitimate for the court to presume, until the contrary is established, that a duty of excise or a customs duty has been passed on. It is a presumption of fact which a court is entitled to draw under Sec. 114 of the Indian Evidence Act. It is undoubtedly a rebuttable presumption b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation came to the notice of the assessee as well as Revenue on 19-12-1990. The differential duty for the period 15-12-1990 to 18-12-1990 was paid subsequently in two installments and was later the subject matter of refund claim. The Tribunal held that only the burden of duty which was assessed and paid during the period 15-12-1990 to 18-12-1990 could be passed on by the appellants to their customers and presumption under Sec. 12B of the Act could be applied to the said duty only and not the enhanced duty which had come to notice of the assessee admittedly only on 19-12-1990. Other cases cited were decided following the ratio of this judgment. 15. The present case is entirely different. Before the appellants started disputing the levy in 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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