2013 (5) TMI 570 - AT - Central Excise

Tribunal dismisses refund appeal citing time-barred claim, unjust enrichment. Correct classification upheld. Duty protest unsubstantiated.

The Tribunal upheld the rejection of the appellant's refund application on the grounds of being time-barred and unjust enrichment. The appellant's ... Rejection of Refund claim – Limitation - The grounds for refund claim are that body built on chassis supplied by the customers are classifiable under Chapter heading 87.07 of the Schedule to the Central Excise Tariff Act, 1985 and covered by SSI Notification No.175/86-CE and they were entitled to avail said Exemption and paid duty under protest during the material period. Held that :- In the present case, the appellants did not challenge the classification list at any point of time. It may be noted that the appellant filed under protest letter on 7.1.1987. But, it is undisputed fact that after two days they filed six nos. classification lists time to time classifying the goods classifiable under heading No.87.04. Thus, the under protest letter has no effect in the eye of law. Appellant relied upon the decision of the Tribunal in the case of Neptune Polymers Vs CCE Ahmedabad [1991 (7) TMI 223 - CEGAT, BOMBAY]. In that case, the assessee, after filing letter of protest, filed another classification list claiming nil rate of duty, which was approved by the Assistant Commissioner of Central Excise. In the present case, the appellant after filing letter of protest (as claimed by the appellant), they filed classification list claiming the goods are dutiable under Heading No.87.04. So, the said case law is not applicable herein. The appellant paid duty on the basis of approved classification list which was not challenged before the Commissioner (Appeals) and therefore, the refund claim application filed on 18.5.1999 is not maintainable and also barred by limitation. Thus, there is no reason to interfere with the orders passed by Commissioner (Appeals). Accordingly, the appeal filed by the appellant is rejected. Issues Involved:1. Classification of body building on duty paid motor vehicle chassis.2. Entitlement to SSI Exemption Notification No.175/86-CE.3. Compliance with procedures under Rule 233B for payment of duty under protest.4. Time-bar of the refund claim under Section 11B of the Central Excise Act, 1944.5. Doctrine of unjust enrichment.Issue-wise Detailed Analysis:1. Classification of Body Building on Duty Paid Motor Vehicle Chassis:The appellant was engaged in body building activities on duty paid motor vehicle chassis supplied by their customers. During the period January 1987 to September 1992, they paid duty under Chapter Heading 87.04. However, the Supreme Court in Collector of Central Excise Vs Ram Body Builders held that such activities should be classified under Chapter Heading 87.07 and are covered by SSI Notification No.175/86-CE.2. Entitlement to SSI Exemption Notification No.175/86-CE:The appellant filed a refund application on 18.5.1999, claiming entitlement to SSI Exemption Notification No.175/86-CE and stating that they paid duty under protest during the material period. The refund was claimed for an amount of Rs.16,17,710/- for the period January 1987 to September 1992.3. Compliance with Procedures under Rule 233B for Payment of Duty Under Protest:The appellant contended that they paid duty under protest, as evidenced by a letter dated 7.1.1987 and recorded in the gate pass. However, the Revenue disputed the filing of this letter, arguing that the appellant failed to produce the original acknowledged copy of the under protest letter and did not follow the procedures prescribed under Rule 233B of the Central Excise Rules, 1944. The appellant argued that the procedure under Rule 233B is not mandatory and that mentioning payment of duty under protest in the gate pass should suffice.4. Time-bar of the Refund Claim under Section 11B of the Central Excise Act, 1944:The original authority rejected the refund claim on the grounds that it was filed beyond the six-month period from the relevant date under Section 11B of the Act. The appellant argued that since they paid duty under protest, the refund claim should not be barred by limitation. However, the adjudicating authority noted that the appellant filed several classification lists under Rule 173B classifying the goods under Heading 87.04, which were duly approved by the competent authority and not challenged by the appellant.5. Doctrine of Unjust Enrichment:The adjudicating authority also rejected the refund claim based on the doctrine of unjust enrichment, stating that the appellant did not produce evidence to show that the incidence of duty was not passed onto any other person. The appellant contended that they did not collect any duty from customers and that the duty was reflected as expenses in their Profit and Loss Account. However, the Revenue presented sample gate passes and TR-6 challans indicating that duty payment was made by customers, suggesting that the burden of duty was indeed passed on.Conclusion:The Tribunal found that the appellant's refund application was rightly rejected on grounds of both time-bar and unjust enrichment. The appellant did not challenge the approved classification lists, which classified the goods under Heading 87.04, and thus the levy of excise duty was considered correct. The Tribunal also noted that the appellant's claim of paying duty under protest was not substantiated as they continued to file classification lists under Heading 87.04 after the alleged protest letter. Consequently, the appeal was dismissed, and the orders of the Commissioner (Appeals) were upheld.