High Court quashes denial of refund claim, shifts burden of proof, allows secondary evidence.

The High Court quashed the Assistant Collector's order denying a refund claim based on the non-production of certain documents, emphasizing the acceptance of secondary evidence when primary documents are unavailable. The burden of proof for refund claims under Section 11B shifted to the petitioner, with pending applications governed by the 1991 amendment. The Court directed the Assistant Collector to reconsider the claim within three months, allowing the writ petition with costs.

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Issues:
1. Quashing of Memorandum No. 114/90 dated 4th June, 1990
2. Refund of duty amounting to Rs. 1,54,865.56 paise
3. Denial of refund claim by Assistant Collector
4. Rejection of claim based on non-production of certain documents
5. Amendment under Section 11B of the Central Excises and Salt Act, 1944
6. Pending refund application and burden of proof
7. Show cause notice regarding unjust enrichment

Analysis:
The petitioner sought to quash Memorandum No. 114/90 dated 4th June, 1990, passed by the Assistant Collector of Central Excise Division III, Ghaziabad, and requested a refund of duty amounting to Rs. 1,54,865.56 paise. The petitioner manufactured cold rolled strips and claimed a reduction in duty under Notification No. C.E. 209/83. Initially granted, the concession was later withdrawn, leading to a series of appeals and refund claims. The Assistant Collector's order dated 4th June, 1990, denied a portion of the refund claim, citing the absence of specific documents like P.L.A. and R.G. 23 Pt. II as the reason for rejection.

The High Court noted that the rejection of the claim solely based on the non-production of certain documents was unsustainable. Despite the lack of primary documents due to riots and burning of records in October 1984, the petitioner submitted secondary evidence like gate passes and bank account details. The Court emphasized that in such cases, authorities should consider circumstantial or secondary evidence to substantiate claims when primary documents are unavailable. Refusal based solely on missing documents like P.L.A. and R.G. 23 Pt. II was deemed unjustified.

Regarding the amendment under Section 11B of the Central Excises and Salt Act, 1944, the Court clarified that the burden of proof to show non-collection of amounts from customers for refund claims shifts to the petitioner. The Court highlighted that the pending refund application, subject to verification by the Assistant Collector, would be governed by the 1991 amendment. The Court also addressed the issue of unjust enrichment raised in the show cause notice, emphasizing the need for parties to present submissions on this aspect before the Assistant Collector for a fresh decision.

Ultimately, the High Court quashed the impugned order dated 4th June, 1990, directing the Assistant Collector to reconsider the claim in light of the Court's observations within three months. The Court allowed the writ petition with costs on the parties involved.

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