2012 (12) TMI 832 - AT - Central Excise

Manufacturer's excise duty refund claim allowed as unjust enrichment doctrine doesn't apply to SSI unit.

M/s YASHRAJ INDUSTRIES Versus COMMISSIONER OF CENTRAL EXCISE, MUMBAI-V

M/s YASHRAJ INDUSTRIES Versus COMMISSIONER OF CENTRAL EXCISE, MUMBAI-V - 2013 (296) E.L.T. 204 (Tri. - Mumbai) Issues:Claim of exemption under Notification 8/03, pre-deposit of duty during investigation, rejection of refund claim based on unjust enrichment doctrine.Analysis:The case involved the appellant, manufacturers of excisable goods, claiming exemption under Notification 8/03 and not paying excise duty on clearances. They were asked to make a pre-deposit of duty during an investigation, which they complied with by paying Rs.1.5 lakhs. However, no show-cause notice was served on the appellant regarding the non-availment of the exemption benefit, leading them to file a refund claim for the amount paid during the investigation. Both lower authorities rejected the refund claim citing the doctrine of unjust enrichment.Upon review, it was noted that the appellant, being an SSI unit claiming Notification 8/03 benefit, was not collecting central excise duty from customers. As they were not collecting duty, the question of unjust enrichment did not apply. Additionally, since no show-cause notice was served for the appropriation of the amount collected during the investigation, it was argued that the lower authorities failed to recognize that the appellant was availing the SSI exemption and clearing goods without duty payment, rendering the unjust enrichment argument irrelevant.In light of these findings, the judgment concluded that the impugned order was not legally sustainable. Consequently, the order was set aside, and the appeal was allowed with consequential relief.