2015 (10) TMI 2136 - AT - Central Excise

Tribunal dismisses Department's appeal on finalization of provisional assessment, emphasizes legal precedents

Commissioner of Central Excise, Customs and Service Tax Mysore Versus Vikrant Tyres Ltd.

The Tribunal dismissed the Department's appeal against the finalization of provisional assessment under Rule 9(B) of Central Excise Rules, 1944 for the ... Demand of differential duty - Refund claim - Finalization of provisional assessment - Held that:- The respondent viz. M/s. Vikrant Tyres Ltd. (now M/s. J.K. Tyres & Industries Ltd.) in letter Ref. No.C.Ex./09/PA2000-01 dt. 20/12/2012 addressed to the Superintendent of Central Excise, Metagalli West Range, Mysore has stated that they had cleared the goods to 10 depots from out of 14 depots and their assessments were finalized for the depots to which goods were cleared during that year; the said fact was mentioned in the Order-in-Appeal No.88/2004. The respondent further argues that the doctrine of unjust enrichment is not applicable to provisional assessment cases, when they are finalized and when any refund is due to the assessee. The respondent refers to the Board’s Circular No.744/60/2003-CX dt. 11/09/2003 mentioning that the Department’s appeal on the said issue was dismissed by the Hon’ble Supreme Court in the case of CCE, Chennai Vs. T.V.S. Suzuki Ltd. [2003 (8) TMI 42 - SUPREME COURT OF INDIA]. - Decided against Revenue. Issues:1. Finalization of provisional assessment under Rule 9(B) of Central Excise Rules, 1944 for the period of July 2000 to March 2001.2. Application of the doctrine of unjust enrichment in cases of finalization of provisional assessment.3. Consideration of sales made to all depots by the assessee for finalization of assessment.Analysis:1. The appeal was filed against the Order of Commissioner (Appeals) upholding the Order-in-Original finalizing the provisional assessment under Rule 9(B) of Central Excise Rules, 1944 for the period of July 2000 to March 2001. The Department contended that the assessments were based on clearances made for only 10 depots, while sales to all depots should have been considered. The respondent argued that the provisional assessment was correctly finalized based on the clearances made for the depots to which goods were transferred during the relevant period.2. The Department raised the issue of applying the doctrine of unjust enrichment to the refunds arising from the finalization of provisional assessment. The respondent, M/s. Vikrant Tyres Ltd., argued that the doctrine of unjust enrichment does not apply to finalized provisional assessment cases where refunds are due to the assessee. They referred to a circular and a Supreme Court judgment supporting their position that the doctrine of unjust enrichment is not applicable in such cases.3. The Department claimed that there were 20 depots involved, not 14 as mentioned by the respondent. However, the Department failed to provide clear evidence regarding stock transfers or sales to all 20 or 14 depots. The respondent maintained that sales were made to only 10 depots, as stated in their letter to the Superintendent of Central Excise. The Department's argument that all depots should have been considered lacked a clear basis due to the absence of evidence to counter the respondent's claim.4. The Tribunal analyzed the submissions and legal precedents cited by both parties. Referring to a Supreme Court judgment, the Tribunal concluded that the doctrine of unjust enrichment does not apply to the facts of the case. The Tribunal found no merit in the Department's appeal, stating that the appeal was not sustainable under the law of Central Excise. Consequently, the appeal was rejected.In conclusion, the Tribunal dismissed the appeal filed by the Department against the finalization of provisional assessment, ruling that the doctrine of unjust enrichment did not apply in this case. The judgment emphasized the importance of following legal precedents and applying the law correctly in matters of Central Excise.