2010 (7) TMI 361

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....availing CENVAT credit on their inputs. During the course of audit in the month of August, 2006 it was pointed out that the appellant has reversed the short duty of Rs. 9,01,143/- on the molasses consumed for the production of exempted products namely Rectified spirit and extra natural alcohol during the month of March 2005 and April 2005. It was also noted that the appellants have reversed the short duty of Rs. 11,630/- on evaporation losses during the month of March, 2005 and April 05. As the duty on molasses was raised from Rs. 500/- to Rs. 1,000/- per M.T with effect from  1-3-2005, the appellants were required to reverse the duty on enhanced rate. On pointing out by the audit party, the appellant reversed the amount of Rs. 9,12,77....

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....eceipt in March and April, 2005. This fact is verified and confirmed by Range Supdt, in his report dated 14-11-2007" rejected the refund claim holding that "Excise Duty on molasses was enhanced w.e.f.  1-3-05, from Rs. 500 PMT to 1000 PMT and the same is used in the month of March & April 05 and as such credit was required to be reversed at Rs. 1000 PMT only and there is no excess reversal." 3.2 He further submitted that, in this case it is apparent on the record that the appellants have not procured any input during March 05 to April 05. Hence, the enhanced rate of duty on molasses is not required to be reversed by the appellant. With regard to the unjust enrichment he contended that the audit took place in August 2006 and th....

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....below have not considered the bar of unjust enrichment hence, the matter required to be remanded to the lower authorities for reconsideration. He further relied on the decision in the case of Metlex (I) Pvt. Ltd. v. CCE, New Delhi - 2004 (02) LCX0114 wherein the Hon'ble apex court held that the appellant had initially proceeded on the footing (of course mistakenly) that there was manufacture, they will not be entitled to claim any refund on the basis of this Judgment. 5. Heard both sides. 6. On careful consideration of the submissions made by both the sides, I find that in this case the appellants have reversed the CENVAT credit under protest on pointing out by the audit party during the course of audit in the month of July 2006....