9911796707
TMI Blog2011 (3) TMI 1214X X X X Extracts X X X X X X X X Extracts X X X X ..... ve suo motu refunded the amount paid in excess on the basis of a simple letter from the assessee. As held in the case of in the Oswal Agro Mills [1994 (2) TMI 57 - SUPREME COURT OF INDIA] the provisions of Section 11B is not attracted when refund arises due to encashment of bank guarantee. Thus the assessee was entitled to refund on the basis of simple letter rather than following the detailed procedure prescribed under Section 11B of the Central Excise Act, 1944. Accordingly allow the appeal filed by the party with consequential relief, if any. X X X X Extracts X X X X X X X X Extracts X X X X ..... g for provisional assessment. When the appeal of the assessee was pending before the Commissioner (Appeals), the Assistant Commissioner encashed the bank guarantee executed by the assessee for a total amount of Rs.49,66,077/- during February to April, 98. Consequent upon the order-in-appeal allowing the quantity discount passed by the Commissioner (Appeals) on 04/03/2002, the assessee requested the Assistant Commissioner to return a sum of Rs.44,16,920/- being the amount of differential duty towards the quantity discount, which was allowed by the Commissioner (Appeals) but which was recovered by encashment of bank guarantee by the department. They also cited the CBEC Circular No.275/37/2K-CX.8A dated 02/01/2002 wherein the Board had held th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, in these judgements, it has been held that encashment of bank guarantee by the department during the pendency of appeal has been considered as pre-deposit and consequently, there is no requirement of filing a refund claim and a simple letter along with copy of the order would suffice. They also argued that doctrine of unjust enrichment is not applicable to refund arising out of encashment of bank guarantees. In the light of these judicial pronouncements they claim that they are entitled to refund without filing a refund claim as the encashment of bank guarantee amounts to pre-deposit of duty. 6. On the other hand, the Ld. DR reiterates the findings of the lower appellate authority and relies on the decision of the Tribunal in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11B of the Central Excise Act, 1944. Further, from the records we find that the department had encashed the bank guarantee during February to April 1998, when the matter was pending before the Commissioner (Appeals), which again is in contravention of the instruction of the CBEC, wherein it has been directed that during the first appellate stage no coercive action should be taken to recover differential duty. Therefore, the action of the Assistant Commissioner to encash the bank guarantee when the matter was pending before the Commissioner (Appeals) and the assessee finally succeeded in their plea cannot be said to be either in accordance with the law or in accordance with the circular/instructions issued by the Board. 9. In the Oswal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shment of bank guarantee by Revenue during the pendency of appellant's appeal before the Supreme Court amounted to pre-deposit under Section 35F of Central Excise Act, 1994/129E of Customs Act, 1962 and the benefit of Board's Circular No.802/35/2004-CX dated 08/12/2004 should be given. 10. We find from the records that the period involved in this case is 1992-97 and the refund was due to the party under Rule 9 (B) (5) of the Central Excise Rules, 1944 and the provisions on unjust enrichment did not apply to the said rules at the relevant time. Therefore, the department should have suo motu refunded the amount paid in excess on the basis of a simple letter from the assessee. We also find that as held by the Hon'ble apex Court in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
