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TMI Blog2019 (12) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The Supply Order clearly mandates that the tax, duty and other levies shall be borne by the Ministry of Defence, which in fact was initially borne by the appellant and later on recovered from the Ministry of Defence. The appellant which is engaged in the manufacture of rail coaches, established in 1952, is owned and operated by the Indian Railways and by virtue of this, it is a Government of India undertaking and as such, the ratio of the decision of the Hon ble jurisdictional High Court in the case of M/s. Sescot Sheet Metal Works Ltd. Vs. CESTAT, Chennai [ 2015 (4) TMI 386 - MADRAS HIGH COURT ] can be applied to underline the fact that it cannot be said that the appellant was unjustly enriched and that thereby, the unjust enrichment at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the documents placed on record. 4. Facts are not in dispute. 5. The assessee is the manufacturer of Railway Coaches. The refund was claimed in respect of excess Excise Duty paid by the appellant on ACCW coaches manufactured by it and cleared for the Ministry of Defence under Invoice No. 278/2015-16 dated 09.03.2016. The appellant while remitting the Excise Duty, had valued the goods in question at 110% of the cost of production of ACCW coaches, like other coaches which were cleared by them for their own use. The Revenue entertaining a belief that the claim of the appellant was hit by unjust enrichment, sought to reject the refund claim vide various Show Cause Notices. After considering the reply filed by the appellant, the Adjudicating Au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant, neither for captive consumption nor for their own use; that the appellant had received an amount of ₹ 249,64,00,000/- through NEFT towards AC-II tier (20 nos. each for 2015-16 and 2016-17) and Military Langer (16 nos. each for 2015-16 and 2016-17), which includes the unit price as well as Excise Duty, Cess, etc. 7.1 The Orders-in-Original, without disturbing any of the above facts, however, also inter alia record the arguments of the assessee to the effect that the terms and conditions between the appellant and the Ministry of Defence is that the actual cost would be informed only on completion of cost report by the appellant duly vetted by internal finance department; that the actual cost if exceeds the Indent value, then ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has also recorded the submissions of the appellant that the cost report was not yet finalized and that the price declared in the invoices were only provisional, to which the Adjudicating Authority has also recorded that when the appellant was unable to determine the value of excisable goods at the time of clearance, it should have resorted to provisional assessment. 8. A perusal of the Supply Order placed on record by the appellant clearly indicates that the basic price for the coaches is ₹ 249.64 crore (for 72 coaches) with inter alia the other condition that all taxes, duties and levies, as applicable, shall be borne by the Ministry of Defence on actual basis. There is also a letter on record dated 15.10.2019 issued by the Dy. Chi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, on a careful perusal of the records as also the orders of the authorities below, without contradiction, and as has been held above, it could be stated that the Department itself has accepted that the appellant is controlled, funded and monitored by the State. Such being the case, as has been held in Mafatlal Industries case (supra) and followed in Karnataka State Agro case (supra), the basic ingredient, which has been held against the appellant, viz., "unjust enrichment" is very much against the principles laid down by the Supreme Court. Further the fact that the Department itself having admitted the fact that the appellant is controlled, funded and monitored by the State, it cannot be said that the appellant is unjustly enriching itse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upplying goods to Civil Supplies Corporation, which is another organ of the State. Such goods are used in relation to Public Distribution System. Hon'ble High Court therefore allowed the party's appeal." 11. From the above, the material takeaway is that the mischief of unjust enrichment could not be attributed to the appellant and the reason given for denying the refund being unjust enrichment, in view of the Board Circular (supra), the same has to fail. That means, as concluded by the Hon‟ble High Court "it cannot be said that the appellant is unjustly enriching itself to the detriment of the people and, thereby, the "unjust enrichment" attributed to the appellant has to necessarily fail …." 12. In view thereof, the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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