2023 (4) TMI 870 - AT - Central Excise

Appellant wins appeal, no unjust enrichment found, Commissioner exceeded scope, impugned order set aside

Carrier Air Conditioning and Refrigeration Ltd. Versus Commissioner of Central Excise, Delhi-III

Carrier Air Conditioning and Refrigeration Ltd. Versus Commissioner of Central Excise, Delhi-III - TMI Issues Involved:1. Entitlement to refund of excess central excise duty paid.2. Examination of unjust enrichment.3. Compliance with Rule 7 of the Central Excise Valuation Rules, 2000.4. Consideration of previous refund orders and their finality.5. Scope of remand order and whether the Commissioner (Appeals) exceeded it.Summary:1. Entitlement to Refund of Excess Central Excise Duty Paid: The appellant, engaged in the manufacture of excisable goods, paid central excise duty on goods cleared to their depots. They filed refund claims for excess duty paid. The Assistant Commissioner sanctioned the refunds, allowing re-credit in the Cenvat credit account. However, the department appealed, and the Commissioner (Appeals) reversed the decision. The Tribunal remanded the matter back to the Commissioner (Appeals) to re-examine evidence related to unjust enrichment.2. Examination of Unjust Enrichment: The Tribunal directed the Commissioner (Appeals) to verify that the appellant did not unjustly enrich themselves by recovering the higher duty from buyers. The Commissioner (Appeals) held that the appellant failed to prove that the higher duty was not recovered from buyers. The appellant argued that they sold goods at a lower price from the depot, indicating no unjust enrichment. They relied on Chartered Accountant certificates and previous refund orders to support their claim.3. Compliance with Rule 7 of the Central Excise Valuation Rules, 2000: The Commissioner (Appeals) held that Rule 7 was not followed. However, the Tribunal found that the original authorities verified documents and found the appellant entitled to refunds. The Tribunal cited the Nahar Spg. & Wvg. Mills Ltd. case, emphasizing that the depot price at the time of removal from the factory is relevant for assessment and unjust enrichment.4. Consideration of Previous Refund Orders and Their Finality: The appellant highlighted that refunds for previous periods were granted and attained finality. The Tribunal agreed that the department cannot take a contrary stand in proceedings on the same issue for the same assessee.5. Scope of Remand Order and Whether the Commissioner (Appeals) Exceeded It: The Tribunal noted that the Commissioner (Appeals) exceeded the scope of the remand order by addressing Rule 7 compliance instead of focusing solely on unjust enrichment. The Tribunal cited the Kodak India Ltd. case, stating that lower authorities cannot travel beyond the remand order.Conclusion: The Tribunal found that the appellant proved no unjust enrichment and that the Commissioner (Appeals) exceeded the remand order's scope. Consequently, the impugned order was set aside, and the appeals were allowed with consequential relief.