Can we get refund of Excise ?

[Asked by Guest]

Dear Sir,

We are a manufacturer and we have our another manufacturing unit at Haridwar which is Excise Exempted Unit.

We transfer SFG items from our unit to Haridwar Unit as per CAS-4 cost of production plus 10% additional.

In general when transfer the item first calculate the transfer price as per our record and periodically we take CAS-4 certificate and paid the difference excise duty if any liability arises as per CAS-4 compare to our self assessment transfer price.

In some items when we calculate the transfer price that is cost of production plus 10% at that time some excel calculation and formula error is happened by which the transfer price of our product is gone up so in that rate our invoice generated and excise also paid. after month end we found that our transfer price was wrong and also we paid excise duty excess. after that we immediately taken the CAS-4 certificate for these items and calculate the how much amount of sale and excise duty gone up due to this wrong transfer price. Immediately we reverse the sale by issuing debit note credit note and take declaration form Haridwar Unit for not availing the cenvat credit, and obtaining the CA certificate for the same.

SO my query is that shall we eligible for get refund of the excess paid Excise duty with appropriate interest.

Regards

Swapneswar Muduli

​

[ashish chaudhary]

You may claim refund under section 11B.

[Rajagopalan Ranganathan]

Sir,

Since your Hardwar unit is exempted from payment of excise duty, they cannot avail the duty paid by as credit. Therefore the doctrine of unjust enrichment will be applicable to your refund claim. Therefore you can file your refund claim under Section 11B of Central Excise Act, 1944.

The time limit for filing the refund claim is one year from date of payment of duty.

[Mahir S]

Sir,

You may file refund claim application as discussed above, however you shall not be entitled for any interest on such excess payment of excise duty; as discussed in your last para.

[Ganeshan Kalyani]

The excess paid excise duty can also be adjusted against excise duty liability arising from future removable of goods as like this one. Getting refund from department is tedious job. Adjustment can also be thought for.

AI Summary

Refund of excess excise duty: claim under Section 11B due to unjust enrichment; file within one year or seek adjustment.
Excess excise duty paid on internal transfers to an excise exempt unit may be recovered by filing a refund claim under Section 11B based on unjust enrichment, since the exempt transferee cannot take cenvat credit. The claim must be filed within one year of payment; interest may not be payable. As alternatives or supporting measures, reverse entries (debit/credit notes), a non credit declaration from the exempt unit, a CA certificate, or adjustment against future excise liabilities can be employed.