2015 (10) TMI 719 - HC - Central Excise

High Court Upholds Tribunal Decision on Refund Request & Unjust Enrichment

The High Court upheld the Tribunal's decision regarding the refund request and unjust enrichment principle under Section 11B of the Central Excise Act ... Denial of refund claim - Unjust enrichment - Held that:- Tribunal was not concerned with the treatment given to the amount and as deposited in the Assessee's profit and loss account. It is immaterial and irrelevant for the Tribunal and equally for us as to what the Assessee terms this amount in his Books of Account. Even if it is shown on the 'expense side' that does not mean that the presumption that the burden has been passed to the consumer can be raised. - principle in this decision is the same which is to be found and applied by this Court in the case of Suvidhe Ltd. v/s Union of India, reported in [1996 (2) TMI 136 - HIGH COURT OF JUDICATURE AT BOMBAY]. A Special Leave Petition against this judgment of this Court was dismissed by the Hon'ble Supreme Court of India on 7th August 1996. - It is this very principle which has enabled the Tribunal to conclude that the Revenue cannot invoke the plea or principle of unjust enrichment to the undisputed facts and circumstances - Decided against Revenue. Issues:Challenge to Customs, Excise, and Service Tax Appellate Tribunal order on refund request and unjust enrichment principle under Section 11B of Central Excise Act 1944.Analysis:The High Court addressed the appeal challenging the Customs, Excise, and Service Tax Appellate Tribunal's order, which dismissed the Revenue's appeal against the Commissioner (Appeals) decision on the refund request. The Tribunal ruled that the unjust enrichment principle does not apply as the Assessee had paid the amount as a pre-condition for stay application, not towards duty liability. The Court emphasized that the treatment of the amount in the Assessee's profit and loss account is irrelevant for the unjust enrichment analysis. The Tribunal's decision was supported by the Supreme Court's stance that Section 11B does not apply when the amount is deposited in compliance with an interim order, not for duty liability.The Respondent's counsel relied on a recent Supreme Court judgment in a similar matter, highlighting the consistent application of the principle in previous cases. The Court referenced a specific case where the Supreme Court dismissed a Special Leave Petition, reinforcing the principle's validity. The Tribunal's conclusion that the Revenue cannot invoke unjust enrichment in the present case based on established legal principles was upheld by the High Court. The Court emphasized that since the issue was settled by the Supreme Court in previous cases, the appeal lacked merit and was dismissed for not raising any substantial question of law.In summary, the High Court upheld the Tribunal's decision regarding the refund request and unjust enrichment principle under Section 11B of the Central Excise Act 1944. The Court emphasized the importance of compliance with interim orders and established legal principles in determining the applicability of unjust enrichment. The consistent application of legal principles by the Supreme Court in similar cases supported the dismissal of the Revenue's appeal.