2007 (2) TMI 28 - AT - Central Excise

Appeal allowed for refund claim due to duty payments made under protest. Judgment on 2-2-2007.

GIRISH FOODS & BEVERAGES (P) LTD. Versus COMMISSIONER OF C. EX., PUNE

The Tribunal allowed the appeal by the appellant, M/s. Girish Food & Beverages Pvt. Ltd., and rejected the Revenue's appeal. The appellant's refund ... Refund – Appellant demanded for refund of duty paid under protest – After considering the fact authority allow the appeals Issues:- Exemption claim under Notification No. 8/03- Payment of duty under protest- Rejection of refund claim on limitation and unjust enrichment- Applicability of unjust enrichment principle- Interpretation of duty payment under protest- Refund claim based on MRP calculationExemption Claim under Notification No. 8/03:The appellant, engaged in manufacturing packaged drinking water, claimed exemption under Notification No. 8/03 due to their factory's rural location. Initially, duty was not paid until a visit by the Deputy Commissioner led to a directive to pay duty. Subsequently, a refund claim was filed after obtaining a certificate confirming eligibility for exemption under Notification No. 87/03.Payment of Duty under Protest:The appellant paid duty under protest for past clearances, which was accepted as not time-barred. However, a part of the refund claim was rejected on the grounds of limitation and unjust enrichment. The Commissioner held that subsequent duty payments were not voluntary but continued under protest, entitling the appellant to a refund.Rejection of Refund Claim on Limitation and Unjust Enrichment:The Deputy Commissioner rejected a portion of the refund claim based on limitation and unjust enrichment. The Commissioner upheld the rejection for a specific period but allowed the remaining claim within the limitation period, emphasizing that duty was paid under Section 4A of the Central Excise Act based on MRP, which remained constant.Applicability of Unjust Enrichment Principle:The Commissioner observed that the duty burden was not passed on to customers as the MRP remained unchanged. The appellant's affidavit and evidence supported their claim that duty was not transferred to buyers. This led to the conclusion that the refund was not impacted by the principle of unjust enrichment.Interpretation of Duty Payment under Protest:The Tribunal analyzed the concept of payment under protest, emphasizing that the initial protest continued to cover subsequent duty payments, even if not explicitly stated. Citing a Gujarat High Court case, the Tribunal concluded that the appellant's protest at the time of the first payment prevented subsequent payments from being considered voluntary.Refund Claim Based on MRP Calculation:The Tribunal considered the duty calculation based on MRP and the consistency of MRP before and after the duty payment. Referring to relevant decisions, the Tribunal determined that the duty burden was not passed on to customers, supporting the appellant's claim for a refund.In conclusion, the Tribunal allowed the appeal by the appellant, M/s. Girish Food & Beverages Pvt. Ltd., and rejected the Revenue's appeal, pronouncing the judgment on 2-2-2007.