excise refund on rate cut

[MEHUL ASHAR]

Respected Sir,

As regarding above subject, one of my clients is a govt. contractor as he is a pole supplier in GEB,some time ago govt. gave him price rise on the previous supply on which he had paid duty now the govt. came to know that the price rise which was given was more than to give due to the mistake of calculation now govt. has pulled the rate hike & told him to pay the money of the added price now the query is that can he claim the refund from excise department of the duty which he has paid on the supply & if he can claim what is the procedure for that & what documents we will need.Please reply

[YAGAY and SUN]

Under Section 11B refund can be applied for, in this matter.

[Rajagopalan Ranganathan]

Sir,

You can apply for refund provided if you return back the duty charged from your customer when you invoiced the differential price. You inform your Range Officer and jurisdictional Assistant/Deputy Commissioner regarding this.

[KASTURI SETHI]

Procedure for refund claim Form R has been prescribed for claiming refund of Central Excise duty/ST under Rule 173 S of Central Excise Rules, 1944. It is to be addressed to the Assistant or Deputy Commissioner of Central Excise with a copy to Range Officer. The assessee should prove that the incidence of duty/ST has not been passed on to the buyer/receiver of service or any other person. This principles of ‘unjust enrichment’ are applicable to Central Excise duty as well as Service Tax. The following requirements are to be fulfilled:- (a) Claim for refund in Form-R is to be filed in duplicate. (b) It should be signed and pre-receipted with a revenue stamp. (c) It should be filed within the limitation period of one year from the date of payment of duty/ST (d) Documentary proof should be submitted that refund would not be hit by the principles of unjust enrichment. The refund claim should be supported by documentary evidence(s) of Service Tax/Central Excise duty paid in excess.The onus of proof that incidence of duty/ST has not been not passed to any other person lies on the claimant of refund. . The claimant has an option to file refund claim electronically through ACES online and submit the hard copies along with necessary documents to the Department for verification.

[MEHUL ASHAR]

THANK U SIR U GUIDED ME WELL IN THIS MATTER

[Mahir S]

Yes, the procedure of refund as discussed in above replies is to be followed.

However, in your case, the excise payment was correctly made, it was only after GEB pointed it out regarding wrong price hike , that the correctly made payment has not been transformed into excess payment.

It would be advisable that instead of filing refund claim, it would be better to rather seek some sort of compensation or adjustment of the excess differential duty payment from GEB while making adjustment of the pulling down of the price rise. The reason being that it shall be difficult to convince the department regarding excess duty payment, not receipt of such excess excise duty portion , non utilization of cenvat credit for such duty payment by GEB , clause of unjust enrichment , reason for sudden downward change in price and that too after supply of goods , unjust enrichment clause etc.

[Mahir S]

the second para line may be read as under :-

However, in your case, the excise payment was correctly made, it was only after GEB pointed it out regarding wrong price hike , that the correctly made payment has NOW been transformed into excess payment.

AI Summary

Refund of excise duty: claim allowed if duty was returned to buyer and unjust enrichment is avoided via prescribed procedure.
A refund of excise duty may be claimed under Section 11B where the incidence of duty was returned to the buyer and not passed on; claimants must file duplicate claims in Form R addressed to the Assistant/Deputy Commissioner with a copy to the Range Officer, signed and pre receipted, within the one year limitation, prove absence of unjust enrichment with documentary evidence of duty payment and repayment, and may file electronically via ACES while submitting hard copies for verification.