2019 (12) TMI 887 - AT - Central Excise

Tribunal remands case for detailed analysis of refund claim, overturns time-barred decision

M/s I.G. Petrochemicals Versus Commissioner of Central Excise, Mumbai

The Tribunal allowed the appeal by remanding the case to the Adjudicating authority for a detailed analysis of unjust enrichment, quantum of refund, and ... 100% EOU - Refund of education cess paid for third time - legality of payment of Education Cess for the third time - refund claim rejected on the ground of unjust enrichment - HELD THAT:- The Adjudicating authority initially rejected the refund claim on the ground of limitation since the same was filed in 2010 for the payment made under protest. However, the Appellate Commissioner in the order set aside the said findings observing that the education cess was paid for the third time under protest, therefore, not barred by limitation under Section 11B of Central Excise Act, 1944. However, he concludes that since the Appellant failed to establish that the burden of duty has not been passed on to the customer, therefore, not eligible for refund. The documents referred to by the Commissioner (Appeals) have not been examined by the Adjudicating authority, while analysing the refund claim. He has passed the order only on the issue of limitation, without scrutiny of other issues. It is necessary to remand the matter to the Adjudicating authority to analyse the relevant documents relating to unjust enrichment, quantum of refund admissible, etc. Needless to say that a reasonable opportunity of hearing be given to the Appellant - appeal allowed by way of remand. Issues:Refund claim barred by limitation, unjust enrichment, quantum of refund, remand to Adjudicating authority.Analysis:The appeal was filed against an Order-in-Appeal passed by the CCE (Appeals), Belapur, regarding the payment of Education Cess for the third time by an 100% EOU during the period from July 2004 to August 2008. The Appellant paid the cess when making clearances to DTA, but later it was found that the levy for the third time was not applicable based on legal principles established by the Tribunal and upheld by the Supreme Court. The Appellant paid the amount under protest following a Show Cause Notice in 2008, and upon winning the case, filed a refund claim in 2010. The Adjudicating authority rejected the claim as barred by limitation, which was contested by the Appellant before the Commissioner (Appeals), who rejected the claim on grounds of unjust enrichment and other issues not considered by the Adjudicating authority.The Advocate for the Appellant argued that the Commissioner (Appeals) correctly ruled that the refund claim was not time-barred and that the burden of duty was not passed on to customers, thus unjust enrichment did not apply. However, the Commissioner (Appeals rejected the claim without detailed examination of the evidence presented. The Revenue did not appeal the ruling on limitation and agreed to remand the matter to the Adjudicating authority for further examination of unjust enrichment and other issues affecting the refund amount.Upon review, the Tribunal found that the refund claim was filed in compliance with the law and not time-barred. The Adjudicating authority's decision based on limitation was overturned by the Commissioner (Appeals). However, the Commissioner (Appeals) rejected the claim on the grounds of unjust enrichment without thorough examination of the evidence. Therefore, the Tribunal decided to remand the matter to the Adjudicating authority for a detailed analysis of relevant documents related to unjust enrichment, quantum of refund, and other issues. The Adjudicating authority was instructed to complete the proceedings within six months while ensuring a fair hearing for the Appellant. The appeal was allowed by way of remand to the Adjudicating authority for further review.