2009 (8) TMI 542 - AT - Central Excise

High Court remands case to CESTAT for review of duty liability transfer and unjust enrichment

The High Court remanded the case back to the Appellate Tribunal CESTAT, New Delhi, emphasizing the consideration of whether the respondent transferred the ... Refund- The respondent paid duty as per annual production capacity but subsequently filed a refund claim on the ground that the length of galleries should not have been included while determining the annual production capacity. The refund claim was rejected by the original adjudicating authority but allowed by the Commissioner (Appeals) relying upon the decision of the Hon’ble Supreme Court in the case of CCE, Jaipur-II v. SPBL Ltd. Held that- we do not find substance in the contention on behalf of the Revenue, as far the merits of the case is concerned. However, the matter has to be remanded to the original adjudicating authority in view of the fact that Commissioner (Appeals) in his order did not consider whether the appellants have passed on the duty liability to their customers or not and whether the grant of refund would amount to unjust enrichment The Appellate Tribunal CESTAT, New Delhi, consisting of Justice R.M.S. Khandeparkar and Shri B.S.V. Murthy, addressed a case where the respondent disputed the determination of annual production capacity (APC) based on the Hot Air Stenter Textile Processors Annual Capacity Determination Rules. The respondent paid duty as per the APC but later filed a refund claim, arguing that the length of galleries should not have been included in the calculation. The Commissioner (Appeals) allowed the refund claim, citing a Supreme Court ruling. The Tribunal initially ruled in favor of the Revenue, prompting an appeal to the Allahabad High Court. The High Court remanded the case back to the Tribunal, highlighting the need to consider whether the respondent had passed on the duty liability to customers and the issue of unjust enrichment.