Excess excise duty on levy sugar must go to the consumer reimbursement fund, not back to the collecting mill.

Excess excise duty collected by a sugar mill on levy sugar was not refundable to the mill where the statutory scheme required transfer of the amount to the Levy Sugar Price Equalisation Fund for reimbursement to the actual consumers. The analysis relied on the Supreme Court's directions in Newabganj Sugar Mills and the later 1976 Fund mechanism, together with the view that refund claims for the differential duty could not be accepted in favour of the collecting mill. The operative effect was that the excess duty had to be credited to the Fund and could not be retained by the manufacturer.

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Issues: Whether the excess excise duty collected and retained by the sugar mill on levy sugar was refundable to the mill, or was required to be credited to the Levy Sugar Price Equalisation Fund for reimbursement to the actual consumers.

Analysis: The revision turned on the settled legal position that sugar mills which collected amounts in excess could not retain them. Reference was made to the Supreme Court's directions in Newabganj Sugar Mills and to the later statutory scheme under the Levy Sugar Price Equalisation Fund Act, 1976. The Government also relied on the view of the Allahabad High Court that refund applications for the portion representing differential excise duty could not be accepted and that such amounts were to be transferred to the Fund for the benefit of the consumers who had paid the excess.

Conclusion: The claim for refund to the petitioners was not admissible; the excess excise duty had to be deposited in the Levy Sugar Price Equalisation Fund.

Final Conclusion: The revision application failed because the excess duty could not be retained by the sugar mill and was required to be dealt with under the statutory fund mechanism for consumer reimbursement.

Ratio Decidendi: Excess duty collected from buyers cannot be refunded to the collecting dealer or manufacturer where the legal scheme requires transfer of such amount to a fund for restitution to the actual consumers.

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