9911796707
TMI Blog2007 (11) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... .A. Patel, learned Consultant appearing for the respondent. 2. As per the facts on record, the respondent is engaged in manufacture of HDPE tapes, fabrics and sacks falling under Chapter 39 of CETA, 1985. During the period relevant for the purpose of present appeal, i.e. from 1-7-1989 to 25-9-1992, the dispute was as regards correct classification of HDPE tapes and fabrics. The classification was approved by the authorities under Chapter 64 on which the respondents paid the duty under protest in as much as they claimed the correct classification under Chapter 39. Subsequently, the Govt. of India issued order No. 8/92, dated 24-9-1992 u/s 37B of CEA, 1944, classifying the tape under sub heading 3920.32 and sack made there from under sub heading 3926.90 and directed the authorities to demand duty under Chapter 39 and to adjust the modvat and grant refund, if any. Accordingly, the respondent filed the refund claim on 24-6-1996 for the period 1-7-1989 to 25-5-1992. 3. The said refund claim made by the respondent made various rounds of litigation before the Commissioner (Appeals) as also before Tribunal and various orders passed in de novo proceedings, as detailed in the impugne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the decision of the Hon'ble Supreme Court of India in case of UOI v. Solar Pesticides - 2006 (116) E.L.T. 401 (S.C.); as regard interest it was held that since refund is not being sanctioned, there is no question of refund. As against this I find that the classification of Tapes under Chapter 39 of CET was disputed by the Department during the material time and accordingly it was classified under Chapter 54 of CET whereas finally Board held it to be classified under Chapter 39 of CET. I find that goods falling under Chapter 54 was not eligible for any Modvat credit during the material time whereas on other hand the goods falling under Chapter 39 was eligible for Modvat credit. Further by classifying the Tapes under Chapter 54 of CET by the Department, the appellants had been deprived from Modvat credit which was their legitimate right under Chapter 39 of CET. Further if the appellants would have been permitted to take credit on granules used in the manufacture of tapes they would have utilized such credit to discharge the duty liability on tapes instead of paying in cash (PLA) and to that extend the issue of refund need to be re examined. I find during the period 1989-90 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayable under Chapter 39 Rs. 57,52,032/- (for the period 89-90, 90-91 91-92 upto 25.5.92). (ii) Admissible Modvat credit on granules under Chapter 39 Rs. 64,07,456/- (iii) Duty paid under protest under Chapter 54 from PLA Rs. 25,12,218/- (iv) Total of Modvat credit admissible duty paid Rs. 89,19,674/- [(ii) + (iii)] (v) Excess duty paid Rs. 89,19,674 - Rs. 57,52,032/- Rs. 31,67,642/- This excise duty was paid due to non allowing of Modvat credit on granules as dutiable goods were classified under Chapter 54, on which Modvat credit was not admissible. I thus observe from the case file that it is not a case of refund of duty paid on intermediate products namely tapes under Chapter 54 during the relevant time, which was captively consumed in the manufacture of sacks/bags but is a case of refund of Modvat credit which was not allowed to them as the tapes were classified under Chapter 54 of CET, which was not covered under the modvat scheme during the material time. I thus hold that this is a case of refund of Modvat credit consequent to reworking of the duty liability as per option exercise by the appellants during the period 89-90 to 25-5-1992. This is exactly what Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment but was credited to Consumer Welfare Fund for failing to cross the bar of unjust enrichment. The issue of unjust enrichment was contested by the Department in CESTAT. And, CESTAT, vide their order no. CI/2277-78/WZB/2000, dated 29-6-2000, remanded the case on the ground that the unjust enrichment would apply in the case of captive consumption too as the Supreme Court did not accept the judgment of Bombay High Court in the case of M/s. Solar Pesticide and the assessee had not shown that incidence of duty has not been passed on before JAC and Commissioner (Appeals). Hence, it can be fairly said that the assessee was not eligible for refund on merits till 29-6-2000.' (2) Thereafter, the assessee enhanced the claim of refund to Rs. 36,22,498.00 vide their letter dated 8-6-2001. Here the assessee changed their stand and made a plea that it is not a case of refund of duty paid on intermediate goods but is a case of refund of Modvat credit which was not allowed to them as the tapes were classified under chapter 54 of CETA, which was not covered under Modvat scheme. This was done after Hon'ble Tribunal had allowed the departmental appeal vide its order dated 29-6-2000. (3) Again, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant of interest from the date of filing of refund claim. The respondent have relied upon the Tribunal's decision in case of Narmada Paints v. CCE, Vadodara - 2004 (169) E.L.T. 88 (Tri - Mumbai), laying down that interest has to be quantified from the date of receipt of refund application and not from the date of fresh application; in as much as the expression used in the said Section is "receipt of such application" and not as "fresh application". As such, we agree with the findings of the appellate authorities that the interest is required to be quantified from the date of filing of refund application. He has taken the right date as 24-6-1996 and 4-3-2005 as dates of filing of claim and has rightly directed the authorities to calculate the interest after a period of 3 months from the date of receipt of the application. No interference is called for in the above finding. 6. As regards the Revenue's contention that the period involved was prior to enactment of Section 11BB and as such no interest is payable, we find that provisions of Section 11BB were enacted w.e.f. 26-5-1995. The present application is filed thereafter though pertaining to the period prior to 26-5-1995, wo ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
