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TMI Blog2024 (4) TMI 859X X X X Extracts X X X X X X X X Extracts X X X X ..... able in para 4.11 it is evident that for determination of the assessable value they have claimed deduction of 40% or 52.10% whereas the price of the goods to the customer remained the same. What they have recovered from the customers is the price of the goods and not the cum duty price. Above analysis clearly establishes that the appellant has passed on the burden of the duty paid on to their customers. In case of COMMISSIONER OF C. EX., MUMBAI-II VERSUS ALLIED PHOTOGRAPHICS INDIA LTD. [ 2004 (3) TMI 63 - SUPREME COURT] , Hon ble Supreme Court has held even on merits, the respondent has failed to make out a case for refund. Since relevant factors stated above have not been examined by the authorities below, we do not find merit in the contention of the respondent that this Court should not interfere under Article 136 of the Constitution in view of the concurrent finding of fact. If on examination of facts and documents the conclusion is that burden of the duty has been passed on to the customers the refund could not have been directed to the appellants but would have to be credited to the consumer welfare fund. There are no merits in this appeal - appeal dismissed. - MR. P.K. CHO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Thirty Nine only) should not be rejected on the ground of unjust enrichment and the amount otherwise liable for refund should not be credited to Consumer Welfare Fund. 2.6 The Assistant Commissioner, adjudicated the show cause notice as per order referred in para 1, thereby rejecting the claim of refund on grounds that the invoices raised by the Appellant between 11.09.2003 to 30.01.2004 clearly show that the Central Excise Duty @ 16% separately was charged from the customers/buyers. 2.7 Aggrieved, the Appellant filed an appeal before the Appellate Authority/Commissioner (Appeals) which was dismissed as per the impugned order. 2.8 Aggrieved Appellant filed an Appeal before the Tribunal, which was dismissed vide Final Order No 1528/2009 SM (Br) dated 10.12.2009 2.9 Aggrieved, Appellant filed as Appeal before the Hon ble High Court of Allahabad, Lucknow Bench. Hon ble High Court has vide its order dated 16.12.2019 remanded the matter back to tribunal for reconsideration after taking into account the invoices and letters written by the appellant to its customer. 3.1 We have heard Shri Atul Gupta, Advocate for the appellant and Shri Sarweshwar T Khairnar, Authorized Representative f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellants are eligible for the refund claimed by them. In fact, the refund has been sanctioned and credited to the Consumer Welfare Fund. The amount otherwise eligible for refund under Section 11B of the Act should not be transferred to the Consumer Welfare Fund under Section 12C of the Act as there is no unjust enrichment and the incidence has been absorbed by the Appellant. This is against the principles of natural justice and the impugned order should be set aside. The findings of the Commissioner (Appeal) are not proper, reasonable and correct. The decision in the matter of Allied Photographics India Ltd. [(2004) 4 SCC 34] is not applicable as the same has been explained by the Hon ble Supreme Court in the matter of CCE, Calcutta vs. Panihati Rubber Limited [(2006) 10 SCC 129] that such case was decided in the facts of that case where the claim was made by the distributor about the price consistency without disclosing the complete facts. Hon ble High Court in its order dated 16.12.2019 observed that judgement means a decision adjudicating upon the legal rights and liabilities of parties after appreciating the evidence on record in a particular fact-situation, and that has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case of duty be also applicable in case of refund? 6. 3. Whether the Learned Commissioner (Appeals) as- well-as Learned CESAT, New Delhi were justified in non- considering the letters addressed to dealers/distributors which were part of record and which proved that the duty was not passed over to them? Further, the appeal was admitted by this Court vide order dated 16.07.2010 on two questions of law. The order dated 16.07.2010 is quoted below:- The appeal is admitted on the following substantial questions of law: (1) Whether it shall be unjust enrichment even if the duty is paid under protest informing the dealers explaining the reasons of deduction? (2) Whether the Tribunal has committed substantial illegality by not considering the principles of law reported in 2006 (10) SCC, 129- C.C.E. Vs. Panhihati Rubber Ltd. Sri Rajesh Chauhan has filed memo of appearance on behalf of respondent No. 1, hence it is not necessary to issue notice. However, in view of the facts and grounds, as stated before us, we feel that for the purposes of adjudicating this appeal, the following question is required to be considered:- Whether the Tribunal was under obligation to consider all the material e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 (SC) relied upon by the appellant is not applicable to the facts of the present case. From the material placed before us particularly two sets of invoices and letters written by the appellant to the buyers and the relevant portion of the order dated 10.12.2009, quoted above, the position which emerges out is to the effect that the Tribunal has not considered the invoices placed by the appellant before it along with the letters of appellant written to the buyers and after considering both the material evidence viz. invoices and letters written by the appellant to the buyers, the Tribunal has not recorded reasons for coming to the conclusion that the appellant is not entitled for refund of the amount in issue. The expression 'Judgment' has been defined in section 2(9) of C.P.C., as judgment means the statement given by the Judge on the grounds of a decree or order. Thus the essential element in any 'judgment' is the statement of grounds of decision, meaning thereby the Court has to state the ground on which it bases its decision. It must be intelligible and must have a meaning. It is distinct from an order as the letter may not contain reasons. Unless the judgment i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l erred in law and fact both. Considering the aforesaid as well as the undisputed submissions made by the learned counsel for the appellant that certain documents were filed by the appellant before the Tribunal through supplementary affidavit and the Tribunal failed to consider the same, we are of the view that the matter may be remanded back to the Tribunal to decide the same afresh. 4.3 From the order of Hon ble High Court, it is evident that matter has been remanded back for de-novo consideration only on the ground that tribunal has in its order failed to take note of the of certain letters written by the appellant to its customers and the invoices while concluding the matter against the appellant vide its order dated 4.4 Impugned order records as follows for upholding the order of Assistant Commissioner: 9. I have gone through the records, submissions made at the time of personal hearing and written brief submitted by the Ld. Consultant at the time of personal hearing. The main issue to be decided is that whether the subject refund claim can be rejected on the ground of unjust enrichment when the duty has not been charged/ shown or not shown on the invoices but the duty was dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law that uniformity in prices during the period of Excise duty and other Periods, does not lead to inevitable conclusion that the incidence of duty was not passed on to the buyers. In this connection, I find a considerable force in the adjudicating authority s contention in this regard, Moreover, the Ld. adjudicating authority has referred to the Hon ble CESTAT s order in the case of Auro Lab Vs CCE, Madurai, wherein the Hon ble CESTAT has found that the buyers were informed about the absorption of duty paid and prices reduced accordingly. It was held by the Hon ble Tribunal that the burden was not passed on so others However, in the present case the appellants have neither-informed their buyers regarding duty absorption by them not they have shown conclusively that the duty burden was effectively absorbed by them. 4.5 Order in Original records following findings for holding that the appellant had passed on the burden of the duty paid by them on to their buyers: 9. I have carefully gone through the case records, defence reply and submissions made at the time of personal hearing. The issue to be decided is whether the said refund claim is covered under the doctrine of unjust enrich ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nisation. 14. In this light, I arrive at a conclusion that the subject refund claim being covered under the doctrine of unjust enrichment, is fit to be rejected and the amount otherwise liable for refund should be credited to Consumer Welfare Fund as specified in Sec 11B of Central Excise Act, 1944. 4.6 The refund claim can be bifurcated into three periods as indicated in the table below depending on the manner in which the invoice have been prepared. S.NO Period Involved Amount of duty deposited Remarks 1. 01.07.2003 to 10.09.2003 Rs. 1,11,605/- duty not charged/shown on the invoice 2 11.09.2003 to 31.01.2004 Rs.2,97,200/- duty shown on the invoices 3 01.02.2004 to 30.04.2004 Rs.1,42,934/- duty not charged/shown on the invoice Total Rs.5,51,739/- Refund claimed 4.7 Appellant has produced copies of three identically worded letters written by them to their customers namely M/s Kaushalya Agency, Patna, M/s Kumar Industrial, Patna and M/s Sanjivani Enterprises, Ranchi. As all the three letters are identically worded we reproduce the text of the letter below: 4.8 From the text of the letter as reproduced above it is quite evident that the appellant has categorically stated in the lette ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.2004 Invoice No Total Quantity of goods (net) Total Price of goods Details of deductions made to arrive at the value under section 4 of the act Assessable Value/ Tariff Value per unit Total assessable value/ tariff value Tariff Heading No/ Exemption Notification No Rate of duty 78 40 3240 40% 48.60 1944 3003.39 Nil 82 500 40500 40% 48.60 24300 3003.39 Nil 95 260 21060 40% 48.60 12636 3003.39 Nil 99 100 8100 40% 48.60 4860 3003.39 Nil 131 260 21060 52.10% 38.80 12636 3003.39 Nil 137 200 16200 52.10% 38.80 7760 3003.39 16% 157 200 16200 52.10% 38.80 7760 3003.39 16% 227 1480+40 38800 52.10% 38.80 18624 3003.39 16% 276 240+20 19440 52.10% 38.80 9312 3003.39 16% 4.12 Section 12A 12B of the Central Excise Act, 1944 read as follows: SECTION 12A Notwithstanding anything contained in this Act or any other law for the time being in force, every person who is liable to pay duty of excise on any goods shall, at the time of clearance of the goods, prominently indicate in all the documents relating to assessment, sales invoice, and other like document, the amount of such duty which will form part of the price at which such goods are to be sold. SECTION 12B Every person who has paid the duty o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rance of the goods, prominently indicate in all the relevant documents the amount of such duty which will form part of the price at which the goods are to be sold, while Section 12B raises a presumption of law that until the contrary is proved, every person who has paid the duty of excise on any goods shall be deemed to have passed on the full incidence of such duty to the buyer of such goods. Since the presumption created by Section 12B is a rebuttable presumption of law - and not a conclusive presumption - there is no basis for impugning its validity on the ground of procedural unreasonableness or otherwise. This presumption is consistent with the general pattern of commercial life. It indeed gives effect to the very essence of an indirect tax like the excise duty/customs duty. In this connection, it is repeatedly pointed out by the learned Counsel for the petitioners-appellants that the levy of duty is upon the manufacturer/assessee and that he cannot disclaim his liability on the ground that he has not passed on the duty. This is undoubtedly true but this again does not affect the validity of Section 12A or 12B. A manufacturer who has not passed on the duty can always prove tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusion that incidence of duty has not been passed on to the buyer as such uniformity may be due to various factors. Hence, even on merits, the respondent has failed to make out a case for refund. Since relevant factors stated above have not been examined by the authorities below, we do not find merit in the contention of the respondent that this Court should not interfere under Article 136 of the Constitution in view of the concurrent finding of fact. 4.15 In case of CEAT Ltd [2004 (170) E.L.T. 442 (Tri. - Mumbai)] Mumbai bench held as follows: 3 . We find that the only ground on which the appellants state that they have not passed on the duty burden to their customers is that the throughout the price charged by them remained the same before and after the variation in the rate of duty from Rs. 265/- per tyre to Rs. 475/- per tyre. However, as rightly held by the Commissioner (Appeals) this is only a presumption and the appellants were required to produce evidence that they have not actually passed on the duty burden, which they have failed to do either before the adjudicating authority as well as the lower appellate authority. As there is no material on record produced by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of CC v. Allied Photographies India Ltd. reported in 2004 (166) E.L.T. 3. Hon ble Supreme Court held that uniformity in price before and after the assessment does not lead to the inevitable conclusion that incidence of duty has not been on to the buyer as such uniformity may be due to various factors. Para 18 of the judgment is reproduced below : Before concluding, we may state that uniformity in price before and after the assessment does not lead to the inevitable conclusion that incidence of duty has not been passed on to the buyer as such uniformity may be due to various factors. Hence, even no merits, the respondent has failed to take out a case for refund. Since relevant factors stated above have not been examined by the authorities below, we do not find merit in the contention of the respondent that this Court should not interfere under Article 136 of the Constitution in view of the concurrent finding of fact . 7. In the present case the contentions are that the above decision of the Hon ble Supreme Court is not applicable to the facts of the case on the ground that the Supreme Court was dealing a case where the invoices in question are not of manufacturers. We find that as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to accept that they did not charge duty from their customers. They in fact indicated the duty separately in their invoices while clearing the goods only with an intention to make it known to their customers/buyers, the duty involved on the cleared goods and requiring them to pay the same. The affidavit of Shri K.C. Sharma, General Manager of M/s. Lloyds Industries, copy of which is at page 84 of the paper book, referred by the Counsel, does not in any manner prove that the incidence of duty was not passed on by the appellants at the time of sale of goods to that company. He has only deposed that his company placed the order with the appellants and the price agreed was inclusive of all taxes and duties and that the rate of duty was not relevant for placing the order. He had not disclosed as to what was the price agreed upon and how much was the duty element therein. When the duty element, as observed above, had been separately shown, besides the price, in the invoices, by the appellants, that itself is enough to make his affidavit meaningless. 4.18 Appellant have heavily relied upon the decision of Hon ble Calcutta High Court reported at [2004 (172) ELT 310 (Cal)] to argue that in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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